Wings of Rescue

CharityWatch has assigned Wings of Rescue a "?" rating for its fiscal year ended December 31, 2023 due to specific concerns we have about the charity's financial reporting, related-party transactions, and recent litigation activity. CharityWatch reached out to Wings of Rescue via U.S. mail and email on March 12th, 2025 with questions. As of April 2nd, 2025, CharityWatch has not received responses to these questions. A summary of the concerns CharityWatch outlined in our inquiry are listed below: 

Fundraising

Firstly, we want to inquire about your charity’s reported fundraising expenses of $0 for fiscal 2023 (IRS Form 990, Part IX, line 25, Column D; and audited Statement of Functional Expenses).

Wings of Rescue reports that it raised $2,679,221 in grants and contributions in fiscal 2023 (IRS Form 990, Part VIII, line 1h; and audited Statements of Activities and Change In Net Assets). Wings also reports that this amount did not include any “unusual grants” (IRS Form 990, Schedule A, Part II, Section A, line 1, Column (e)).

Questions:

(a)   Please explain how it was possible for Wings of Rescue to raise $2,679,221 in 2023 without spending any money to do so.

(b)  Please indicate if there were any fundraising expenses reported as a management expense in the line item “Advertising and Promotion.” If so, please indicate what portion of the $122,909 reported on this line should have been reported as a fundraising expense (IRS Form 990, Part IX, line 12).

(c)   Please indicate if any of Wings of Rescue’s other reported 2023 program expenses of $1,982,195 should have been reported as a “management and general” or fundraising expense in the IRS Form 990, Part IX, columns (C) and (D). If so, please provide  breakouts reflecting which line items contain incorrect reporting and in what amounts.

(d)  Did Wings of Rescue incur any Joint Costs in fiscal 2023 from a combined educational campaign and fundraising solicitation as defined by SOP 98-2 (ASC 958-720), (IRS Form 990, Part IX, line 26). If so, please indicate the total amount of Joint Costs Wings of Rescue incurred in 2023 and provide a functional allocation breakout.

Independent Contractors

Wings of Rescue reports that it paid $731,306 to Berry Aviation, Inc. for “Charter Services” in 2023 (IRS Form 990, Part VII, Section B).

Wings of Rescue reports total expenses of $843,173 for “chartered rescue flight” in 2023 (IRS Form 990, Part IX, line 24a; and audited Statement of Functional Expenses).

Wings of Rescue reports that in 2023 it generated $738,804 in “Animal Transportation,” or “Transportation service revenue” (IRS Form 990, Part VIII, line 2a; and audited Statements of Activities and Change in Net Assets).

Questions:

(a)   Please explain what accounts for the difference of $111,867 between total $843,173 in “chartered rescue flight” and the $731,306 paid to Berry Aviation, Inc. in 2023. For example, was this $111,867 paid to an additional vendor(s)?

(b)  Are any of the Officers, Directors, Trustees, or Key Employees reported in Wings of Rescue’s 2023 IRS Form 990, Part VII, pilots who are paid to perform animal transportation, flight services, or any related services? If so, is such compensation already included in Reportable Compensation in IRS Form 990, Part VII, Section A, columns (D), (E), and (F)? Was Wings of Rescue required to file an IRS Form 990, Schedule L, for its fiscal year 2023?

(c)   Do any of the Officers, Directors, Trustees, or Key Employees reported in Wings of Rescue’s 2023 IRS Form 990, Part VII have a financial interest in Berry Aviation, Inc.? For example, do any have an ownership interest in this vendor and/or do any receive payments of any kind from this vendor?

(d)  Wings of Rescue, according to its 2023 IRS Form 990, is located in San Diego, California. The independent contractor to which it reports paying $731,306 in 2023 for “charter services,” Berry Aviation, Inc., is reported to be located in San Marcos, Texas. This $731,306 amounts to approximately 37% of Wings of Rescue’s total reported 2023 program spending and approximately 32% of its reported 2023 total spending.  Please explain the process Wings of Rescue used to identify, vet, and select Berry Aviation as its primary vendor for charter services.

(e)   With respect to the $738,804 in “Animal Transportation” program service revenue Wings of Rescue reports generating in 2023, please generally describe the nature of these services and to whom they are provided. For example, does Wings of Rescue provide these services to other charities as an aspect of its programmatic activities, or is this purely a revenue-generating activity (IRS Form 990, Part VIII, line 2a).

Grants

Wings of Rescue reports giving out total grants of $868,167 in 2023 (IRS Form 990, Part IX, line 1; IRS Form 990, Schedule I; audited Statements of Functional Expenses).

Of this amount, Wings of Rescue reports that $735,562 was granted to an organization by the name of “Fetch, Inc.” of Bend, Oregon for “animal transportation.”

Other grantees are reported to have received grants in amounts ranging from $8,605 to $25,000 in 2023.

Questions:

(a)   Was this $735,562 grant paid to Fetch in one transaction or in multiple transactions throughout the year?

(b)  Did Wings of Rescue receive any goods or services in exchange for any portion of this $735,562 amount?

(c)   Wings of Rescue reports in its Form 990 Statement of Functional Expenses that it made total grants amounting to $868,167 in 2023. Whereas, in its IRS Form 990, Schedule I, total grants add to only $844,167. Please explain what accounts for the $24,000 discrepancy.

(d)  Grants to Fetch in 2023 account for nearly 85% of total reported grants for the year; 37% of its total reported program expenses for the year; and over 32% of its reported total expenses for the year, as reported by Wings of Rescue in its IRS Form 990 Statement of Functional Expenses. Please explain the process for how this grantee was identified, vetted, and selected to receive a grant or grants in 2023 that account for such a large portion of Wings of Rescue’s spending.

(e)   In its 2023 IRS Form 990 for its fiscal year ended 12/31/2023, Fetch reports total contributions and revenue for the year amounting to only $643,800, whereas Wings of Rescue reports granting Fetch $735,562 during this same financial period of 1/1/2023 – 12/31/2023. Please provide any information you have as to what accounts for the $91,762 discrepancy between these two amounts, if any. If the $735,562 amount is not accurate, please provide an accurate figure for the total amount Wings of Rescue granted to Fetch in fiscal 2023.

Governance & Related Policies

Wings of Rescue reports that it does not have or consistently monitor a written conflict of interest policy and that it also does not have a written whistleblower or document retention and destruction policies (IRS Form 990, Part VI, Section B, lines 12a-c, 13, and 14).

Questions:

(a)   Does Wings of Rescue intend to draft and adopt any or all of the above policies prior to filing its fiscal 2024 IRS tax Form 990 with the Internal Revenue Service (IRS)?

Financial Reporting

Questions:

(a)   In consideration of the preceding questions, does Wings of Rescue intend to file an amended IRS tax Form 990 and related schedules for its 2023 reporting year?

(b)  In consideration of the preceding questions, does Wings of Rescue intend to request a restatement of its audited financial statements for its 2023 reporting year?

(c)   Given that the $735,562 granted by Wings of Rescue to Fetch in 2023 accounts for 100% of Fetch’s total reported contributions and revenue for the year, was Wings of Rescue required to present its audited financial statements on a combined or consolidated basis for fiscal 2023 to comply with Generally Accepted Accounting Principles (GAAP) in the United States?

Commitments and Contingencies

According to the Wings of Rescue fiscal 2023 audited financial statements, Note 5, Commitments and Contingencies, Litigation, “…In June 2024, the Organization had a dispute with a key employee which resulted in a separation agreement with the employee releasing the Organization from any future claims and litigation and a benefits payout of $160,000.”

Questions:

(a)   CharityWatch is aware of separate legal disputes existing between Wings of Rescue and former officers of the organization Yehuda Netanel and Damian Cross. Was the benefits payout related to one of these former officers? If so, please indicate to whom this separation agreement and benefits payout relates. If not, please provide the name and job title of the person to whom this separation agreement and benefits payout relates.

(b)  As of the date of this inquiry, is the benefits payout fully paid? If not, please provide the amount of the remaining liability and the schedule for when Wings of Rescue anticipates fully satisfying the debt.  

(c)   Please provide information indicating how the debt was satisfied or will be satisfied. For example, will the $160,000 benefits payout required under the separation agreement consist of a cash payment(s) to the relevant party? Or, is all or a portion of this debt offset by a related liability from the relevant party? (NOTE: In the event Audit Notes 5 & 6 are related to financial transactions with the same former officer, we are trying to understand if the amounts owed by that officer to the organization have offset a portion of the $160,000 that Wings of Rescue owes to said individual for the benefits payout).

Related Party Transactions

According to the Wings of Rescue fiscal 2023 audited financial statements, Note 6, Related Party Transactions, “…the Organization entered into an unsecured note receivable with a former member of the Board in the amount of $100,000…The former Board member defaulted on the loan and in May 2020, the Organization won a judgement from a legal action taken against the former Board member in the amount of $115,000…”

(a)   Did Wings of Rescue recover the full $115,000 that resulted from the legal action? If not, what was the total amount collected under this legal judgment? If a portion of the judgment was written off as uncollectible, please provide a dollar figure for this amount and indicate in what year(s) the bad debt was recognized in Wings of Rescue’s financial statements.

(b)  Above and beyond this $115,000 amount, did the individual in question owe Wings of Rescue for any personal expenses paid for with charity funds? If so, please cite the amount and indicate if it was fully paid off or if all or a portion of the amount was written off by the organization.

Additional Legal Matters

With respect to Case No. LC 105556 of the Superior Court of the State of California, County of Los Angeles, Northwest District, Wings of Rescue alleged that Yehuda Netanel was negligent as it pertains to his handling of his or the organization’s tax liability obligations under the California Use Tax related to the airplane that was purchased in August 2015 and later flown into California.

In addition, in a February 2021 settlement discussion, a court document states that “the parties have agreed in principle that it makes sense to sell the Pilatus [plane] on the open market…the details of the sale agreement are still being negotiated.”

Questions:

(a)   Please indicate if the referenced California Use Tax was successfully disputed by the organization or if it was required to pay it to the State and in what amount. If the latter, please provide the fiscal year(s) in which the tax was paid and where it is reported in the relevant audit(s) and Form(s) 990.

(b)  Please explain if the plane was ultimately sold and in what amount. If so, please indicate what amount was recovered by Wings of Rescue related to its sale of the plane.

(c)   Have all legal matters related to the case been fully settled?

General

Given the preceding questions related to Wings of Rescue’s financial reporting, lack of governance policies, and legal disputes, we would like to give you an opportunity to provide any additional information that you think may be relevant with respect to any changes that have occurred at the organization since its 12/31/2023 fiscal year.

(a)   For example, has Wings of Rescue since adopted conflict of interest, whistleblower, and document retention and destruction policies?

(b)  Has Wings of Rescue continued or severed ties with any major vendors or grantees, and/or has it adopted formal policies and procedures for determining which vendors to hire and for making decisions about grant recipients?

(c)   Has Wings of Rescue expanded its board of directors?

 Should Wings of Rescue provide adequate responses to CharityWatch's questions and concerns at some point in the future we may update our rating of Wings of Rescue at that time. 

According to the Wings of Rescue audited financial statements for the fiscal year ended December 31, 2023, Note 3, Concentrations: 

"Major Donors For the years ended December 31, 2023 and 2022, one donor represented approximately 49% and 12% of grants and contributions revenue, respectively."

Wings of Rescue reports total contributions and grants in 2023 of $2,679,221, according to its IRS Form 990 and audited financial statements of that year. 

"Major Customers For the years ended December 31, 2023 and 2022, one customer represented 84% and 94% of transportation service revenue. 

According to Wings of Rescue's 2023 IRS tax Form 990, Part VII, Section B, Independent Contractors, Wings of Rescue paid $731,306 to Berry Aviation, Inc. for "Charter Services" that reporting year. Wings of Rescue reports in its tax filing total "Chartered Rescue Flight" expenses of $843,173 during the same year. 

According to the Wings of Rescue audited financial statements for the fiscal year ended December 31, 2023, Note 6, Related Party Transactions: 

"On May 25, 2020, the Organization entered into an unsecured note receivable with a former member of the Board in the amount of $100,000 with a compounding interest rate of 3.5%. The note required scheduled payments of $2,500 due monthly over two years and a final balloon payment of $40,000 due in June 2020. The former Board member defaulted on the loan and in May 2020, the Organization won a judgement from a legal action taken against the former Board member in the amount of $115,000 that is secured by a deed of trust. The settlement agreement required monthly payments from April 2020 through January 2022. During 2022, the Organization received a final payment of $8,000, for amounts previously deemed uncollectible which is included in other income..."