CharityWatch REPORT
Issued September 2016

CharityWatch Articles & Donor Alerts

CharityWatch conducts research and publishes articles on charities. Current and archived articles we have written about this charity are posted here, as are select articles we have published with topics related to this charity or its cause. Visit our Articles page to view CharityWatch's entire library of posted articles.

CharityWatch Articles

 
The GuideStar Exchange Program: Sometimes Gold, Silver and Bronze Mean Less Than You Think

If we see a gold insignia associated with a charity, that charity must be a highly worthy one to which to donate, right? Unfortunately, this may not always be true, and in the case of the GuideStar Exchange program, even unworthy, financially inefficient charities can receive a gold, silver or bronze level designation.

CharityWatch Hall of Shame

The most important lesson to be learned from the following colorful stories of charity scoundrels is that regardless of how distinguished, well-connected and honored a charity leader is, he is only human and may be tempted to use the power and influence of his position to abuse the public's trust and thusly become the next member of the CharityWatch Hall of Shame.

Are Charity Boards Asleep at the Wheel? Nonprofit Governance Problems

Confidence in nonprofit organizations is at the lowest level in two decades and one-third of Americans who are 57 or older have less confidence in nonprofit organizations over the last 2 years, according to a September 2002 survey by Epsilon, a major fundraising company.

Feed the Children Execs Accused of Stealing Donated Supplies Intended for the Needy

After conducting a four-month investigation, WTVF, a Nashville television station, recently reported that it had secretly videotaped Feed the Children's (FTC) Nashville front office "from the executive director on down" regularly taking boxes of donated goods. WTVF reported that "even family members [of FTC staff] got in on the action." Warehouse workers, who tipped off WTVF about the alleged thefts, told that station that they saw staff takes boxes they believed were intended for Kosovar Refugees and Oklahoma Tornado Victims.

Charity Accused of Trying to Squelch Unflattering News About Itself

The Daily Oklahoman reported that the son of Larry Jones, founder and president of Feed The Children (FTC), AKA Larry Jones Ministries International, stated in a personal bankruptcy filing that he owed his father's charity $950,000. When the Oklahoma City newspaper pursued its story, FTC appeared to attempt to squelch the news. "These are disturbing and reprehensible tactics, of the kind you would expect from the worst elements in society, not from our religious leaders," commented Stan Tiner of the Oklahoman in an editor's note that accompanied the story.

Charity Circulated Forged Audits

When are audited financial statements unaudited? When the accompanying audit report is fake. The fiscal 1999 and 1998 financial statements of Feed the Children (FTC), formerly Larry Jones International Ministries, Inc., distributed to AIP and state regulators contain the forged signature of Arthur Andersen L.L.P., a major public accounting firm.

Food is Only a Small Portion of What Feed the Children Distributes

Feed the Children (FC), an AIP F-rated charity that spends only 18% of its cash budget on program services and spends 60% on direct mail and television and radio ads, has been enormously successful obtaining gifts in kind. In fiscal 2004 FC received $865 million in donated goods, a 79% increase from fiscal 2003. 64% of its in kind donations came from three corporations, according to FC's fiscal 2004 audit.

Charity Questions the Value of Donated Goods: How $118,000 Shipment May Be Worth Less Than $7,000 to Recipients

Feed the Children (FC) is practically a household name thanks to its celebrity endorsers and television infomercials featuring malnourished children in impoverished areas of the globe. The charity claims on its web site that it spends 83% of its budget on its programs. What some donors may not realize is that hundreds of millions of dollars worth of donated goods are included in this high program percentage, some of which are "worthless to most people" according to one Oklahoma based charity, Mission Shawnee (MS).

Charity Head Stages Failed Coup

Larry Jones, founder of the well-known hunger charity Feed the Children (FC), was recently mentioned in an ongoing court case in which the group's longstanding board of directors claim they were unlawfully ousted by Jones, board chariman Dwight Powers, and five improperly appointed directors. Court papers reveal that after learning of the board's plans to place him on "indefinite sabbatical," Jones packed the board in his favor with directors who would be friendly to him and then fired the longstanding directors.

The Most Outrageous Charity in America: Larry Jones' Feed the Children

From forged audits and alleged employee theft in the late '90s to alleged burglary and board coup staging within the past year, no other major charity can match Feed the Children's (FC) record of outrageous behavior over the past ten years. The madcap antics of Feed the Children and Larry Jones, its founder and president for 30 years, may be coming to an end.

Feed the Children Controversies Continue: Charity Accused of Overstating Its Work in Haiti

More bad behavior has come to light after AIP handed Feed the Children (FC) its "Most Outrageous Charity Award" in our last edition of the Charity Rating Guide. After having worked three decades at the charity, FC founder Larry Jones was finally fired by its board last November after admitting to authorizing the bugging of three FC officials' offices. Jones filed a wrongful termination suit later that month and the charity countered 12/28/09 with a claim against Jones, including allegations that he took kickbacks from vendors, did not tell the truth to FC's board about giving himself and his wife unauthorized raises, and had a large stash of porn magazines hidden in his office and his private area at this Christian charity.

All-in-the-Family Charities Receive F's

While not all charities that have family members running them receive poor grades from the American Institute of Philanthropy, many of them do. The Chronicle of Philanthropy last September published "Family Ties: a Sampling of Charities With Relatives in Top Spots." Five of the six family-run charities mentioned in the article receive F grades from AIP.

"Not So" GreatNonprofits

On its web site, GreatNonprofits bills itself as "a place to find trustworthy nonprofits." The site allows people - from donors to clients, volunteers to employees - to submit reviews of nonprofits. These reviews are prominently featured on web sites like Guidestar, Charity Navigator, and JustGive. At first, this may seem like a good idea. After all, consumers commonly use reviews on sites like Yelp and Trip Advisor to help them choose restaurants and hotels. What is wrong with using crowdsourced reviews to help donors pick nonprofits?

The Alice in Wonderland World of Charity Valuation

In the wonderful world of charitable gifts-in-kind (GIK) where lives are saved and suffering is lessened, nonprofit executives can fully utilize their creative abilities when measuring the value of the donated goods they receive such as medicine, food, clothing, books, and other materials that flow through a charity's financial statements. Charities that place high values on GIK donations can falsely appear to be spending a higher percentage of their funds on programs than other groups that receive mostly cash contributions. Donors who rely on these charities' claimed program percentages when making giving decisions might think they are giving to highly efficient organizations when in fact most of their cash donations are being spent on overhead.

Inefficient, Tax-Delinquent, and Even Fake Charities Pass CFC Screens

For many donors, an easy, convenient way to donate to charity is through the United Way, the Combined Federal Campaign (CFC), or other workplace giving campaign that allows employees to have money deducted directly from their paychecks for charity. For U.S. federal employees, including civil servants, postal workers, and military personnel, the CFC is the only charity solicitation campaign permitted by law in the workplace. The money raised is later distributed to the more than 22,000 CFC charities and charity federations participating in the program based on causes of the donor's choosing.

Hot Topics & Donor Alerts

 
Feed the Children Facing Official Inquiry & Lawsuit from Former CEO

Updated on April 19, 2017

The Oklahoma City based Feed the Children (FTC), which has long received poor ratings from CharityWatch and was named “The Most Outrageous Charity in America” by us in 2009, is now facing new turmoil, according to a March 2017 report by The Oklahoman. Based on complaints by FTC’s former CEO and President, J.C. Watts, the Oklahoma State Attorney General’s Office initiated an official inquiry into FTC in the fall of 2016, focusing on the “management and operation” of the charity. The Oklahoma County District Attorney will act as a special prosecutor and will determine whether there is any wrongdoing at FTC.

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