Aid Charity’s 95% Program Claim Is ‘Unfair and Deceptive’
Posted on July 13, 2018
The California Attorney General has accused Food For The Poor of using an "unfair and deceptive" program percentage statement in its fundraising solicitations. In that "95% Statement," which per the AG, "created a likelihood of confusion or misunderstanding in the minds of potential donors," FFP touted: "Fundraising and other administrative costs comprise less than 5% of our expenses; more than 95% of all donations go directly to programs that help the poor." The AG's allegations against FFP cover two issues of continued concern to CharityWatch: the valuation of donated gifts-in-kind, and the use of joint solicitation costs.
Don’t Be Fooled By Name Rip-off Charity Scams
Posted on June 15, 2018
How much harm could there really be in confusing the names of two charities? Confusing a poorly-run charity for a well-run charity is one thing, but imagine how disheartening it would be if the entire amount of what you thought was a legitimate charitable donation essentially ended up being stolen because of name confusion. Two recent phony charity scams give CharityWatch the opportunity to remind donors how easy it can be to fall victim to charity name confusion, and to reinforce the importance of checking the legitimacy of a charity before giving. The scams basically relied on ripping-off the names of two large, nationally-recognized charities.
WonderWork Co-Founder is No Mr. Wonderful
Posted on March 08, 2018
Brian Mullaney, the man who for charities like Smile Train and WonderWork, popularized the dubious fundraising advertising claim of "100% to Program," may face legal action and tax penalties, potentially for unjust enrichment, self-dealing, tax avoidance, and other claims related to his tenure as WonderWork co-founder, president, and CEO from 2011 to 2017. As part of WonderWork's bankruptcy proceedings, a Final Report of Examiner, filed in November 2017 by the court-appointed Examiner, detailed Mullaney's history of employing questionable fundraising practices to play on the emotions of empathetic donors, using most of the funds raised to pay for more fundraising while also enriching himself.
Conflicts of Interest Are a Red Flag for Donors: Some Charity Insiders May Take Unfair Advantage of Their Position
Posted on February 20, 2018
The recent media attention given to conflicts of interest may have a political lean, but managing conflicts of interest has always been a critical part of good governance for charities and other nonprofits. The existence of conflicts of interest at a charity, or even the appearance thereof, should raise a serious red flag for donors. Therefore, it is important for donors to understand the concept of conflicts of interest, and to be able to recognize when a charity may be troubled by such conflicts.
The Senate Singles Out WWP For Bad Practices That Also Occur At Other Charities
Posted on August 14, 2017
Multiple media outlets, including CBS News and The New York Times, accused WWP of wasting donations on "lavish" spending, such as pricey travel, food and drink, and conferences for WWP employees. The U.S. Senate Judiciary Committee took notice of the news reports from early 2016 and as a result, questioned WWP concerning its alleged "questionable spending practices." After WWP's responses to the Senate Judiciary Committee were analyzed, a report issued by Chairman Charles E. Grassley, Senate Judiciary Committee Member, Senate Finance Committee, dated May 24, 2017, ("the Senate Report") has rained some harsh criticism down on WWP. CharityWatch has reviewed the Senate Report, and donors should take note because the criticisms are not necessarily unique to WWP.
Reported Charity Salaries May Not Tell the Full Story
Posted on April 04, 2017
Donors often seek out information on charity executive salaries when considering whether or not to donate to a particular nonprofit. Such information is widely available online from aggregator websites that use software to pull and republish data from public tax forms. Unfortunately, the presentation of such salary data often causes donors to incorrectly conflate low salaries with financial efficiency. In addition, donors are prone to inferring that the salary data they are viewing represents the total payments received by a particular executive from the charity that employs them, when this is not always the case. To identify a worthy charity, donors must look beyond the face value of the salary data they encounter online and dig deeper.
Costly and Continuous Kars4Kids Ads Disguise Charity's Real Purpose
Posted on March 10, 2017
Described by many as annoying and by SFGate.com as the subject of "widespread, ubiquitous hate," the catchy advertising jingle for the charity known as Kars4Kids can now be heard not only on radio stations nationwide, but also on major TV networks. ...The TV spot has aired on popular networks such as ESPN and Fox News and has been viewed over 880,000 times on YouTube, with each play of its earworm jingle lightheartedly encouraging people to "donate your car today." By now, you are probably (begrudgingly) familiar with the Kars4Kids jingle, but just how familiar are you with how Kars4Kids spends the money it makes from all those "kars" that get donated "4" kids?
Crowdfunding Popularity Continues to Soar Despite Risks to Donors
Posted on January 20, 2017
Several years ago most people probably had never heard the word "crowdfunding." Defined as the process of funding a project or cause by raising money from a large number of people, typically through a website, crowdfunding has become so popular that over $34 billion in funds were raised via crowdfunding platforms in 2015. The extraordinary amount of money that is being raised through crowdfunding is astonishing considering how relatively easy it is for those with questionable intentions to try to take advantage of crowdfunding donors.
Celebrity Charity Finances Are Hidden Behind Closed Doors
Posted on November 01, 2016
In addition to giving back to the community or supporting a cause with a personal connection, there are a variety of reasons (public image and tax relief among them) why it is fairly common for celebrities and professional athletes to start a charity. Perhaps you are familiar with some of them, such as the Andre Agassi Foundation for Education, Gary Sinise Foundation, or Michael J. Fox Foundation for Parkinson's Research, each of which are rated by CharityWatch. Such celebrities can use their star power to raise funds with relative ease. Before you become a star-struck donor, though, CharityWatch wants to warn you about a certain type of celebrity charity that may be ducking the transparency standards for which all public charities should be accountable.
Multiple Names + Exaggerated Programs = Two Related Charities, But Little Help for Vets or Cancer Relief
Posted on September 20, 2016
Veterans and cancer are two of the most popular charitable causes to which Americans direct significant donations. While these two causes seemingly have little to do with one another, one set of charities proves otherwise. Help the Vets (HTV) and Breast Cancer Outreach Foundation (BCOF) are two relatively new charities that share the same address and phone number, as well as the same family members in leadership positions, including president. But of more concern to donors should be another shared trait between HTV and BCOF -- the likelihood that most donations will go towards paying for-profit, professional fundraisers rather than for helping veterans or cancer sufferers.
Follow the Money: Beware of Groups that Pass Your Donations to Inefficient Charities
Posted on June 03, 2016
Say that you hear on a news report that a veterans charity has a ninety-six percent program services ratio. You think, "Wow, I'm going to donate $50 because almost all of it will be used for the needs of veterans," and so without further thought, you go ahead and make a $50 donation that day. It turns out, though, that instead of about $48 of your $50 going to veterans services, only about $25 was used for such programs. If the charity really spends 96% on programs, how is that possible?
Update: The IRS Has Made It Too 'E-Z' to Start Charities
Posted on March 08, 2016
Less than a year ago CharityWatch warned donors to get ready for a stampede of solicitations thanks to the IRS's July 2014 introduction of a new "streamlined" application process for certain eligible organizations to apply for 501(c)(3) public charity tax-exempt status by submitting IRS "Form 1023-EZ."
Charity Finishes Last at Car Donation Charities: Micro-Mini Share of Proceeds Go to Charity
Posted on December 18, 2015
Its "Wheels for Wishes" ads that mention "Make-A-Wish" have attracted tens of thousands of car donations, but it appears that many more of these "wheels" are for profits than for charitable wishes. Car Donation Foundation (CDF), the nation's largest car donation charity, publicly uses the "Wheels for Wishes" name to solicit vehicle donations across the U.S. for the benefit of local chapters of the Make-A-Wish Foundation (MAW). The promotional-partner MAW chapters receive funds from CDF after the donated vehicles have been sold or scrapped.
Long Running Family Charity Scheme Exposed
Posted on July 27, 2015
Unfortunately for most of us, we have been touched personally by cancer in some way. That makes it all the more shameful when bad actors in the charity world mislead good-intentioned donors under the ruse of helping cancer patients, only to turn the misfortune of others into a great fortune for themselves and for-profit fundraisers. Four such cancer charities with a history of "F" grades from CharityWatch finally have been sued in a nationwide regulatory action. Cancer Fund of America (CFA), Cancer Support Services (CSS), Children's Cancer Fund of America (CCFOA), and The Breast Cancer Society (BCS), as well as certain of their leaders, now have the dubious honor of being defendants in the first jointly filed lawsuit by the Federal Trade Commission (FTC), all 50 states, and the District of Columbia alleging deceptive solicitations by charities.
Help Hospitalized Veterans Is Banned from VA Hospitals
Posted on January 30, 2015
Another startling fact concerning the "F" rated Help Hospitalized Veterans (HHV) has come to the attention of CharityWatch.
A Donor's Guide to Serving the Needs of Veterans and the Military
Posted on January 26, 2015
Over 3.8 million war veterans were receiving disability compensation from the U.S. Veterans Affairs Department (VA) as of March 2014, according to the National Center for Veterans Analysis and Statistics (NCVAS). This is out of over 21.6 million U.S. veterans in 2014, based on NCVAS projections. Even though the government, tens of thousands of nonprofit organizations, and millions of caring Americans try to provide support for veterans and military families, many are not receiving the help they need.
Donors' Intentions Violated at For-profit Thrift Stores
Posted on January 22, 2015
When you donate unwanted clothes or household goods to a charity for resale at thrift stores, just how much of the dollar value of those items actually goes to the charity you've intended to support? In some cases, the answer to that question can be more complicated than you might think.
Huge Amounts of Donations Squandered by 'F' Rated Charity Before Settlement Is Reached
Posted on September 24, 2014
Believed to be the largest amount of financial relief ever obtained in the U.S. for deceptive charitable fundraising, a $24.6 million settlement will be paid by the for-profit direct mail vendors of what has become one of the largest veterans charities in the U.S., Disabled Veterans National Foundation (DVNF). The settlement, announced in July 2014, was secured by New York's Office of the Attorney General (OAG) as a result of its investigation into the alleged direct mail fundraising abuses by Quadriga Art (and its affiliates, including Brick Mill Studios ) and Convergence Direct Marketing in connection with their services on behalf of DVNF.
The GuideStar Exchange Program: Sometimes Gold, Silver and Bronze Mean Less Than You Think
Posted on April 09, 2014
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.