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.
The charity's counterclaim alleged that Jones failed "to disclose that he entered into an improper and unauthorized 3-year contract with Affiliated Media Group... [and] that he was in business with a top executive of Affiliated Media Group in another business venture…" In a 12/30/09 article, Jones told The Oklahoman that he was paid $10,000 a month in sales commissions by Affiliated Media Group (Affiliated) because he "recruited preachers to use the company for their own fundraising spots…" and that he helped his son get a job with Affiliated. FC paid Affiliated $110 million from fiscal 2005 through fiscal 2007 according to August 22, 2008 board minutes filed with a prior lawsuit, FC v. Osteen.
Since Jones was fired from FC, he has gone from being a defender to a critic of the charity. Last summer Jones defended the Oklahoma City based charity's purchase of a $1.2 million house in the Los Angeles area "to reach out to celebrities" and told the Oklahoman that his daughter "lived and worked out of the house as intended." Yet in legal papers filed 1/19/09 against FC, he accused his daughter of "treating a business residence in California as her personal residence." In the same lawsuit he criticized other employees who worked for him for many years when he was head of the charity, including accusing FC's chief financial officer, Christy Tharp, of being incompetent even though she had worked for him as FC's CFO since 2002.
Just a month after the catastrophic earthquake struck Haiti, a CBS News investigation exposed that FC was greatly exaggerating the amount of aid it was providing to victims. The 2/18/10 story, which included an interview with AIP's president, showed that while FC's web site claimed that it was "providing medical relief for 12,000 people," the three doctors that FC employed in Haiti could realistically only treat about 100 people a day. FC's web site also said that United Nations agencies "are partnering with us to provide food and milk for the entire camp," but when CBS investigators visited the camp, they were told by FC's field manager in Haiti, who has since resigned from FC, that this was not true. CBS reported that more than two weeks after the quake struck FC had not fed anyone. When CBS reporter Sharyl Attkisson during an on-camera interview told FC Director of Communications Tony Sellars that no food had been handed out, his response was, "That does surprise me at this time, yes."
In response to the CBS piece, FC issued a press release stating: "We were advised that World Food Programme already had rations for one million people for one month as part of their ongoing programs before the quake. Accordingly, our priority was tents, blankets, medical supplies and bottled water." FC later indicated on its ftcfacts.com site that it disputes its ex-field manager's claim in the CBS report that FC had not provided food at the camp, claiming that it had distributed a significant amount of food on January 20th. FC characterizes the CBS report as inaccurate.
While AIP has been giving FC an F grade since we began reviewing the charity over a decade ago, other charity monitoring agencies that previously gave top honors to FC have only recently lowered FC's standing.
The BBB Wise Giving Alliance (WGA) had been granting FC its Wise Giving Seal, for which it paid WGA $15,000 annually, up until about the middle of last year. There is another connection between WGA and FC. Larry Jones v. FC court papers filed by the charity in 12/28/2009, state that WGA's Treasurer, Marcus Owens, Esq. had been hired by Larry Jones to help him with a failed scheme to fire FC's board "and replace them with his hand picked Pastor Board, so Larry Jones would have unfettered control over FTC [Feed the Children] and he could continue his free wheeling dominance of its affairs." Owens is also a former director of the IRS's Exempt Organizations Division and is presently an attorney with the law firm of Caplin & Drysdale. Owens told AIP that he could not comment on the lawsuit due to his professional obligations.
Be careful to not let a four star rating by Charity Navigator (CN) become a green light to give without checking further. In a November 2009 article in the Daily Oklahoman CN spokeswoman Sandra Miniutti said FC has CN's highest possible rating and "is one of those charities that has their financial health in order." CN continued to give its top rating of four stars to FC, which it heavily promoted on its web site and in press releases until February 19, 2010, the day after the CBS news story on FC was released.