It's not just about those whose money is at stake. The whole point of having non-profits as an option for corporations in the first place is to encourage things

It's not just about those whose money is at stake. The whole point of having non-profits as an option for corporations in the first place is to encourage things that broadly benefit society. Effectively turning a non-profit into a for-profit company is directly counter to that, and it means that society as a whole was defrauded when non-profit status was originally claimed with its associated perks.