Donor-advised funds (DAFs) are tax-efficient ways to empower individuals to give money to causes they support — and they're charities in their own right that are responsible for all the donations they make.

Why it matters: That tension is causing real problems — including a new securities fraud accusation against Goldman Sachs. (Goldman denies any instance of securities fraud. More on that below.)

Driving the news: In a letter sent to the SEC, Goldman Sachs is being accused of securities fraud by the National Institute for Workers' Rights, asserting that an affiliated DAF, Goldman Sachs Gives, gave money to causes that work against Goldman's stated diversity goals.

The big picture: The DAF in question runs funds that come from Goldman employees, which means that one or more of those employees first gave money to Goldman Sachs Gives, and then asked GSG to donate some of that money to certain right-wing causes.

• An individual donation from the employee to the charity would be unproblematic. Coming from Goldman Sachs, however, it runs counter to the bank's stated positions.

Zoom in: In 2022, GSG donated $175,000 to Students for Fair Admissions, America First Legal, the Center for Renewing America, and the American Accountability Foundation.

• Those organizations, affiliated with conservatives Edward Blum and Stephen Miller, are opposed to the pro-diversity agenda that Goldman stands behind.

State of play: NIWR claims that Goldman Sachs Gives is effectively part of Goldman Sachs, and that by undermining its own diversity goals, Goldman was misleading investors when it proclaimed its commitment to those goals.

• Goldman "need to own the contributions they're making," Jason Solomon, the director of NIWR, tells Axios.

For the record: Goldman Sachs spokesperson Tony Fratto told Axios that when it comes to DAF donations, "we can't police the politics and ideology of our workforce," and that Goldman's corporate donations to initiatives like One Million Black Women dwarf all employee donations to the far-right funds.

• While Goldman can and does bar donations to some entities — The People's Forum, for instance, fell off the list after Oct. 7 — "you don't want us making broad ideological decisions," per Fratto.

The bottom line: Goldman has its own DAFs in large part to be able to make impressive claims about how much money the firm, along with its clients and employees, gives to charity.

• By taking control of the narrative (and the DAFs), however, it also ends up being held accountable for a very broad range of donations.

Collectively, DAFs boast assets of more than $200 billion and make more than $50 billion per year in grants. That's a lot of money to be sitting in a legal and conceptual gray area.

Why it matters: If DAFs aren't considered legitimate charities in their own right, then donors couldn't get the all-important upfront tax deduction for donating to them.

The big picture: DAFs skate a very fine line. With all other charities, for instance, you can't change your mind after giving them money, and ask for it to go somewhere else entirely. By contrast, it's very common to see money move from one DAF to another.

How it works: DAFs are a way of bunching gifts of money or appreciated stock so that a large tax deduction can be taken upfront, long before any decision is made as to when to give that money to charity or who it should go to.

Between the lines: There are two main ways of thinking about what DAFs are.

1. The bottom-up view of a DAF — the one you'll see in the way that DAFs communicate to the public — is that it's a group of individual accounts held at a firm like Fidelity or Vanguard, into which donors can contribute and from which they can make donations.
2. The top-down view of a DAF — the way it's structured for legal and IRS purposes — is that it's a single charity. The individuals with accounts can recommend donations, but the DAF itself is the entity responsible for giving away the money.

Zoom out: The tensions between the practical and legal views of DAFs can be seen across the news.

• Fidelity Charitable last month stopped allowing its clients to make donations to UNRWA, the main UN agency providing aid to Gaza. In identical statements to Rolling Stone and to Axios, Fidelity Charitable refused to say why (or even admit that) it had made the change. After Axios' inquiry, however, UNRWA reappeared on Fidelity's list of eligible nonprofits.
• The Tides Foundation is a clearinghouse for donations to and from progressive funders. Because it has funded causes affiliated with the pro-Palestinian protests, some reports claim that any and all of its funders can therefore be considered to be donors to the protests, even if they never directed any of their own funds to those causes.

The bottom line: Technically speaking, it's arguably true to say that anybody with an account at Fidelity Charitable is a funder of America First Legal, which received more than $5 million from the DAF in 2022. Similarly, Goldman Sachs is responsible for all donations made from its DAFs.

• In practice, however, the whole point of DAFs is to allow individuals to make their own decisions as to where their money is donated. If that wasn't the case, the DAFs would have no assets at all.

"I want you to bet on Argentina. Help me ... to make Argentina the new Rome of the 21st century."

That was one key part of Milei's keynote lunchtime address at the Milken conference — the annual gathering of billionaires, executives, CEOs (and anyone else with the financial means to pay for a badge) in Los Angeles.

Driving the news: Milei's speech — the first-ever address delivered completely in Spanish at Milken, with translation headsets provided to attendees — was part warning, part economic victory lap, and part investment pitch.

The economist-turned-president warned of what he describes as Western countries' embrace of socialist policies.

• The business sector's only social responsibility, Milei said yesterday, is to make money.

The extreme austerity measures he implemented have put Argentina on a more solid footing, he said. The troubled nation still faces double-digit inflation, but it has cooled in recent months.

• "The establishment said this was impossible," Milei said. Talk of improving economic conditions elicited applause from the audience.

The so-called transformation of Argentina will "place us alongside the great powers of the world," he said.

• "I am convinced, without the slightest doubt, that Argentina has all the conditions to be the new Mecca of the West," Milei said.
• Milei says now is the best time for Milken attendees—"heroes," as he called them—to invest. (And he seems to have convinced fellow Milken speaker, Elon Musk).