Beware False Profits
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The Tampa Bay Times has recently come up with a list of America's worst
charities. It was compiled using tax records to determine how much was
spent on fundraising in comparison to percentage of revenue spent on direct
cash aid. The results are incredibly shocking: while watchdog groups say that
NO MORE THAN 35% should be doled out to fundraisers, some have paid as much as
And most of them list themselves as aids to
children, cancer or AIDS victims.
From the Tampa Bay Times expose:
The worst charity in America operates from a metal warehouse
behind a gas station in Holiday.[FLA]
Every year, Kids Wish Network raises millions of dollars in donations in the name of dying children and their families.
Every year, it spends less than 3 cents on the dollar helping kids.
Most of the rest gets diverted to enrich the charity's operators and the for-profit companies Kids Wish hires to drum up donations. In the past decade alone, Kids Wish has channeled nearly $110 million donated for sick children to its corporate solicitors. An additional $4.8 million has gone to pay the charity's founder and his own consulting firms.
Of the worst 50 charities, 13 were ostensibly to help children. (NOTE: the Tampa article did not include links, but I have, so you can see that these organizations look quite professional). The numbers after the links denote the actual percent of funds spent on direct cash aid.
A merican Foundation for Children With Aids - 0
American Foundation For Disabled Children - 0.8
Caring for Our Children Foundation - 1.6
Children's Cancer Fund of America - 5.3
Children's Cancer Recovery Foundation 0.6
Children's Charity Fund 2.3
Children's Leukemia Research Association 11.1
Children's Wish Foundation International 10.8
Committee For Missing Children 0.8
Find the Children 5.7
Kids Wish Network 2.5
Operation Lookout National Center For Missing Youth 0
Youth Development Fund 0.8
...and to further tug at the purse strings, don't forget all those service people - policemen, veterans, and firefighters:
American Association of State Troopers 8.6
Association for Firefighters and Paramedics 3.1
Circle of Friends For American Veterans 6.5
Disabled Police and Sheriffs Foundation 1.0
Disabled Police Officers Counseling Center 0.1
Disabled Police Officers of America Inc. 2.5
Firefighters Assistance Fund 3.2
Firefighters Burn Fund 1.5
Firefighters Charitable Foundation 8.1
International Union of Police Associations, AFL-CIO 0.5
National Narcotic Officers Associations Coalition 0
National Police Defense Foundation 5.8
National Veterans Service Fund 7.8
Our American Veterans 2.3
Police Protective Fund 0.8
Reserve Police Officers Association 1.1
The Veterans Fund 2.3
United States Deputy Sheriffs' Association 0.6
Veterans Assistance Foundation 10.5
Vietnow National Headquarters 2.9
NOTE: In some instances, investigations like the Tampa Bay expose has actually caused some organizations to remove websites (as in Our American Veterans), while others are limply protesting. And some government organizations are taking a closer look at those organizations as well.
Poor Management or Just Plain Scam?
The Tampa article points out one particularly salient point: all these organizations are considered legitimate charities because of poor regulation. There is no set limit on expenditures for fundraising, executive salaries or perks.* Kids Wish Network, for example, actually admitted to paying enormous sums to for-profit fundraisers.
But others ...
"All In The Family"
James T. Reynolds of the American Cancer Fund has turned the Fund into a veritable cash cow - for his own family. The pdf put out by the Tampa Bay Times shows an incredible network of sons, daughters, in-laws who are syphoning off millions each year. Reynolds himself pockets more than $230k per year while Junior grabs $280k. The charities involved: Cancer Support Services, Breast Cancer Society, Cancer Fund of America, Children's Cancer Fund of America, and American Association for Cancer Support. Tracking $250 million, the Bay Times found out that $156,766,511 was paid to solicitors. Cancer has served the Reynolds family well.
What a donor doesn't know may not hurt him as much as it will hurt the cause he's giving to: scams and ill-run charities are the biggest cause of the wane in charitable donations.Therefore, before giving a penny to any organization, (especially solicited by phone), check with this national database of disciplinary actions, or any number of watchdog organizations.
An excellent source for intelligent giving, for example, is Charity Navigator. Note that most of the aforementioned charities are also on watch at CN and have very low ratings. Youth Development Fund, for example, shows program expenses at a whopping 52% and fundraising expenses at 45%. What goes into "youth development, only the CEO knows.
Oh, and for Christian "ministries" claiming to perform works of social justice, check out MinistryWatch.com to find out about "transparency" - some of the biggest organizations (e.g. Trinity Broadcasting Network) rate an "F".
Being aware of charity scams kinda makes giving a dollar to that homeless person on the street a lot easier.
... at least you know where it's going.
*Even celebrities are in on the charity game: check out Sean Hannity's Freedom Concert controversy.