New Tax on Nonprofits with $1 Million Plus Pay Packages
Thanks to the new tax law passed in December 2017, nonprofits that pay their top officials compensation in excess of $1 million a year must now pay a tax to the federal government. The 21% excise tax applies to the top five highest paid covered employees at a nonprofit and is calculated on the amount of each covered employee’s annual compensation over the $1 million threshold. CharityWatch rates a number of nonprofits that compensated at least one employee more than $1 million in 2016 or 2017. Check out CharityWatch’s list of Top Compensation Packages.
'Sham' Disabled Police Charity Agrees to Shut Down in Settlement with Missouri AG and FTC
"Cheating citizens out of money and personally profiting under the guise of helping disabled law enforcement is despicable," said the Attorney General of Missouri in a March 28th, 2019 press release announcing a settlement with "sham charity" Disabled Police and Sheriffs Foundation (DPSF) and its founder, David Kenik. DPSF and Kenik were facing allegations of engaging in "deceptive acts or practices by making false or misleading claims in charitable solicitations." DPSF has agreed to permanently cease operations as part of the settlement, which also included a $9.9 million monetary judgment.
Cyclone Idai Relief
Cyclone Idai slammed into the Mozambique port of Beira on March 14th. United Nations chief Antonio Guterres reportedly described Idai as “an uncommonly fierce and prolonged storm.” The cyclone devastated the African countries of Mozambique, Malawi and Zimbabwe. The death toll has risen to 750 people, and hundreds of thousands more are displaced. Tens of thousands of homes were destroyed. Some reports put the costs of the lost infrastructure at $1 billion. It is estimated that at least one million children need urgent assistance, and there is growing concern about outbreaks of malaria and cholera.
Millions collected, Tampa charity for veterans goes MIA; Charity watchdog turns Tampa veterans charity in to Department of Defense
Updated on March 07, 2019
VetMade Industries has been shuttered by Florida's Attorney General following the series of reports by NBC News Tampa. For more, see: Florida Attorney General sacks bogus veterans charity following 8 On Your Side investigation.
Posted on September 06, 2018
"We think this [displaying the insignias of the U.S. military on their car donation website page] is pretty serious so we [CharityWatch] wrote the Department of Defense warning of this," explained Borochoff. Watch part two of the NBC News Tampa segment on how Tampa-based VetMade Industries is using the official insignias of the U.S. military on its car donation page.
Posted on September 04, 2018
"This is outrageous," Daniel Borochoff, president of CharityWatch, stated. Watch the NBC News Tampa segment on how Tampa-based VetMade Industries raised millions of dollars but has never helped provide training for any veterans.
Popular Fundraising Pages Could Be Frauds, Experts Warn
Watch CharityWatch president, Daniel Borochoff, on NBC Chicago discussing the potential pitfalls when donating to a GoFundMe campaign. Also, check out the CharityWatch article, Crowdfunding Popularity Continues to Soar Despite Risks to Donors.
The Cost of Doing Good: CBS Minnesota Investigates Salvation Army Spending
Watch CharityWatch president, Daniel Borochoff, on CBS Minnesota commenting on the compensation and benefits practices of Salvation Army officers. [Note: CharityWatch rates the Salvation Army-Central Territory and its other three Territories, based on their audited financial statements and other factors.]
For the 11th year in a row no house awarded in the San Diego Ronald McDonald House dream house raffle
(Update, February 2019: After dropping for-profit raffle consultant, Ronald McDonald House Charities of San Diego finally offers the highly advertised dream house to its raffle winner. See The San Diego Union-Tribune's Dream House Raffle is back...and this time it is giving away the house.)
Posted on June 20, 2018
"It should be called 'The Castle in the Sky Raffle' with a disclaimer that it is constructed with pipe dreams," CharityWatch's president said in The San Diego Union-Tribune's Charity parts ways with Dream House raffle consultant.
Posted on May 18, 2018
"The raffle ought to give away the prize that’s most heavily advertised and promoted. It’s misleading, clearly, unless someone has pored over the fine print, and obviously, people aren’t doing that," according to CharityWatch's president, Daniel Borochoff, on CBS SF Bay Area talking about the San Francisco Dream House Raffle to benefit the Yerba Buena Center for the Arts.
‘National’ Illness Prevention Charity Agrees to Dissolve in Settlement with Michigan AG
"This group has been scamming people for years, preying on the generosity of Michigan’s donors and inflating the numbers on their financial statements," said the Attorney General of Michigan (OAG) in a September 25th, 2018 press release announcing allegations against the National Emergency Medicine Association (NEMA) for "operating a fundraising scheme to defraud the public." In response to the OAG’s allegations of deceptive solicitations, NEMA has agreed to cease operations and dissolve as part of a settlement announced by the OAG on December 13th, 2018.
Indonesia Tsunami Relief
On December 22nd a massive tsunami hit the coastal areas along the Sunda Strait between the Indonesian islands of Sumatra and Java. Over 400 people are reported dead. Additionally, more than 150 people are missing, about 1,500 are injured, and an estimated 22,000 have been displaced in the aftermath. No warning alert was issued for this tsunami since it was triggered by the Anak Krakatau volcano, not an earthquake. Coastal residents reported not seeing or feeling any warning signs before huge waves of up to ten feet pummeled the shore.
With so much need, what's the best way to donate time, necessities or money?
Listen to CharityWatch's founder, Daniel Borochoff, and NPR host, Rose Aguilar, field calls from the San Francisco Bay Area on people's favorite ways of helping others this holiday season.
Why Doesn't CharityWatch Rate the Trump Foundation?
Updated on June 15, 2018 and December 19, 2018
The Donald J. Trump Foundation is not eligible to be rated by CharityWatch because it is structured as a private foundation. CharityWatch primarily rates public charities, as well as some social welfare and veterans organizations that broadly solicit the public for donations.
On December 18th, 2018, the Attorney General of New York announced that the Trump Foundation has signed a stipulation agreeing to dissolve under judicial supervision. Per the stipulation terms, the Foundation can only distribute its remaining charitable assets to organizations approved by the NY AG's office (OAG). According to its press release, the OAG's lawsuit (noted below) will continue to move forward "to ensure that the Trump Foundation and its directors are held to account for their clear and repeated violations of state and federal law."
On June 14th, 2018, the Attorney General of New York announced a lawsuit against the Donald J. Trump Foundation, and its directors, Donald J. Trump, Donald J. Trump, Jr., Ivanka Trump, and Eric Trump. According to the NY AG's press release, the suit alleges "a pattern of persistent illegal conduct...that includes extensive unlawful political coordination with the Trump presidential campaign, repeated and willful self-dealing transactions to benefit Mr. Trump's personal and business interests, and violations of basic legal obligations for non-profit foundations."
Updated on November 14, 2018
Three major wildfires in California have displaced hundreds of thousands of people and have destroyed thousands of homes and buildings. The Camp Fire in Northern California’s Sierra Nevada foothills has become the state’s most destructive wildfire on record, as well as the state’s deadliest wildfire since the 1933 Griffith Park wildfire. The town of Paradise was virtually obliterated with nearly 7,000 structures ravaged. Statewide, at least 50 people have died, and over 200 people may still be missing.
Hurricane Michael Relief
Updated on October 12, 2018
Hurricane Michael will go down in history as the third strongest hurricane to hit the United States. Michael made landfall on October 10th with winds of 155 mph. High winds, rains and flash floods ravaged several states, as far north as Virginia. The violent storm devastated the Southeast, causing death and destruction from Florida to Virginia. Some coastal Florida cities were destroyed beyond recognition.
Indonesia Earthquake and Tsunami Relief
Twin disasters rocked the Indonesian island of Sulawesi on September 28th. A 7.5-magnitude earthquake set off the massive tsunami that slammed into the beaches of Palu and Donggala. As of Monday night, the death toll reached over 1,200 people and is expected to continue to climb as rescuers dig through rubble and reach inaccessible areas.
Yemen Humanitarian Crisis
Since 2014 war has ravaged the country of Yemen. Yemen has historically been the Middle East’s most poverty-stricken country. According to the United Nations, the country continues to face the world’s worst and largest humanitarian crisis. It is estimated that more than 8 million people in Yemen are on the verge of famine, and about 22 of its 29 million people need assistance.
Hurricane Florence Relief
Updated on September 18, 2018
Hurricane Florence, one of the strongest storms to hit the Eastern Seaboard in decades, made landfall in North Carolina in the early hours of September 14th as a Category 1 storm. Florence caused catastrophic and historic flooding in some parts of North Carolina, South Carolina, and Virginia. Some areas were hit with over 30 inches of rainfall. As of September 18th, 32 storm-related deaths were reported, and about 500,000 homes and businesses were without power in North and South Carolina. Tens of thousands of homes were damaged.
Typhoon Mangkhut Relief
Typhoon Mangkhut is the world’s strongest storm so far in 2018, at one point measuring 550 miles wide. The powerful super typhoon brought heavy rains, strong winds, storm surges, and landslides, leaving a trail of destruction across Southeast Asia. Mangkhut pummeled Hong Kong and caused more than 2.45 million people to be evacuated in China’s Guangdong province. The hardest hit was the Philippines where the storm destroyed homes, flooded large areas of the countryside, and devastated the rice fields of farmers.
CharityWatch Hall of Shame UPDATE
We have inducted the newest member into the CharityWatch Hall of Shame, Lola Jean Amorin, formerly of The Arc in Hawaii. Read about the shameful and criminal acts that landed her in our Hall of Shame.
‘Operation Donate with Honor’ – the FTC, 54 Attorneys General and 16 State Agencies Join Forces to Target Deceptive Fundraising for Veterans Causes
In an effort to "crackdown on fraudulent charities that con consumers by falsely promising their donations will help veterans and servicemembers," the Federal Trade Commission (FTC), along with law enforcement officials and charity regulators from 70 offices in all 50 states, the District of Columbia, American Samoa, Guam and Puerto Rico, announced more than 100 actions and a consumer education initiative called "Operation Donate with Honor." The July 19th, 2018 announcement by the FTC describes that "[o]ne striking feature of the more than 100 actions … is the breadth of the alleged illegality."
A number of Veterans & Military charities that have received “F” ratings from CharityWatch are included in the “Operation Donate with Honor” enforcement actions, including Foundation for American Veterans, Healing Heroes Network, Help the Vets, and VietNow National Headquarters.
RAICES Facebook Fundraiser Goes Viral: Tops $20 Million, Tripling Group’s Annual Budget In Two Weeks
As people across the U.S. and around the globe reacted to the media coverage of immigrant family separations at our southern border, a Facebook fundraiser for Refugee and Immigrant Center for Education and Legal Services, or RAICES, went viral. At one point, the campaign reportedly was bringing in donations of over $10,000 per minute, and within about 17 days, almost $20.6 million had been raised. For RAICES, the success of the Facebook fundraiser, created on June 16th by a Silicon Valley couple, Charlotte and Dave Willner, has been shocking. To put the $20.6 million in context, it represents about 3.7 times RAICES’ annual expense budget and about 3.2 times its total contributions raised in all of 2016.
Immigrant shelter's CEO among highest paid charity leaders
Watch CharityWatch's president on CNN discuss the nearly $1.5 million salary of the CEO of Southwest Key Programs, the non-profit that is now providing one-half of the housing for migrant children who were recently separated from their parents.
Rohingya Refugee Crisis
Updated on July 9, 2018
As of May 2018, more than 900,000 Rohingya refugees have fled from Myanmar’s Rakhine State to Cox’s Bazar, Bangladesh for safety, and the violence inflicted by the military in Myanmar continues to escalate. The mass exodus of refugees in the region since August of 2017 has made this the fastest growing refugee crisis in the world.
The U.N. has called this crisis a "clear case of ethnic cleansing" as the Myanmar military has launched brutal attacks on Rohingya villages in Rakhine. As a mostly Muslim minority in the Buddhist-majority Rakhine, the Rohingya are not welcome in the country they called home, Myanmar, and are unwanted by neighboring countries.
Puerto Rico Relief – Hurricane Maria Aftermath
Hurricane Maria directly hit the U.S. territory of Puerto Rico in September of 2017 as an extremely dangerous Category 4 storm. It was the first and strongest Category 4 or higher to hit the island in nearly 80 years. The official government death toll in Puerto Rico is listed at 64, but a recent study from the New England Journal of Medicine estimates that more than 4,600 “excess deaths” occurred in the aftermath of the storm. Even today, the effects of Maria are still being felt. The damage from the hurricane will likely plague the island and its residents for years to come.
Syrian Humanitarian Relief
Syria’s raging civil war headed into its eighth year in March 2018. Currently, as many as 13.1 million Syrian people are in need of emergency aid. According to the United Nations High Commissioner for Refugees, 5.6 million Syrians are registered as refugees seeking assistance in neighboring countries, and the total number of people fleeing Syria may be much higher than that. The violence has also displaced 6.1 million people within Syria where the distribution of aid is difficult. The Syrian conflict has created the world’s worst refugee crisis since World War II.
(Image: © UNICEF/NYHQ2015-0153/Tiku)
'False Financial Reporting Scheme' Leads to Shut Down of Cancer Charity
According to a Final Judgment and Permanent Injunction, dated March 8, 2018, in the matter of The People of the State of California v. The National Cancer Coalition, The National Cancer Coalition (NCC) has been shut down.
In a complaint filed on March 6, 2018, the California Attorney General alleged that NCC made "false and deceptive representations" related to its "vastly overvalued" in-kind pharmaceutical donations, and that NCC made misrepresentations in its fundraising solicitations about its Breast Cancer Relief Foundation "special project."
Poorly Performing Veterans Charities
Florida AG Seeking Shut Down of Charity Exploiting Causes for Breast Cancer, Fallen Firefighters and Fire Victims
"It is absolutely abhorrent to exploit families of fallen firefighters and breast cancer patients to steal from generous Floridians. …[E]very dollar given to a deceptive charity is a dollar that does not go to those in need. This is an outrageous ploy and those responsible will be held accountable," said Florida’s Attorney General in a December 18th, 2017 news release announcing a complaint filed against Community Charity Advancement, Inc. (CCAI).
CCAI raises funds under the names: Breast Cancer Research & Support Fund, U.S. Firefighters Association, and U.S. Volunteer Firefighter Association. Over the 2013-2016 period, CCAI reports raising about $22.8 million in cash donations, of which 86% went into the pockets of CCAI’s for-profit professional fundraisers. CCAI has consistently received “F” grades from CharityWatch.
WonderWork CEO Resigns; Independent Bankruptcy Trustee to Take Over Management of the Charity
About 11 months after WonderWork filed for bankruptcy in the wake of an arbitrator’s decision that it pay HelpMeSee a $16 million award (see Donor Alert posted on 2/2/2017), WonderWork’s co-founder and CEO, Brian Mullaney, has resigned from the charity amid “allegations of fraud and misdeeds,” according to a November 9, 2017 report by The Wall Street Journal. The news of Mullaney’s resignation came on the same day that a judge tasked a U.S. bankruptcy trustee with finding an independent trustee to take over management of WonderWork.
Veterans Charity Shut Down: 'Did Virtually Nothing for Veterans'
"For years VietNow has scammed donations from people who thought their money would be used to support necessary services for our military veterans. Instead, VietNow pocketed donations and did virtually nothing for veterans. Today’s settlement finally will put an end to VietNow’s egregious fraud," said the Attorney General of Illinois in a November 6th, 2017 press release. The Illinois AG’s release announced a settlement led by Illinois, California, Michigan and Ohio, and joined by 20 other states, to dissolve VietNow National Headquarters (VietNow).
Hurricane Maria Relief
Updated on September 25, 2017
On the heels of Hurricane Irma's path of destruction through the eastern Caribbean, these same islands faced a new threat: Hurricane Maria. Maria made landfall as a Category 5 storm on the island of Dominica where 27 deaths have been confirmed. The hurricane then continued on to directly hit the U.S. territory of Puerto Rico as a Category 4. The full extent of the devastation in Puerto Rico is still being assessed, but most buildings are damaged or destroyed, and millions are without power or communications.
Mexico Earthquake Relief
Updated on September 20, 2017
Less than two weeks after a devastating 8.1 magnitude earthquake hit Mexico’s southern Pacific coast, a second earthquake ripped through central Mexico on September 19th, collapsing buildings and killing over 300 people nationwide. The 7.1 magnitude quake was felt most strongly in and around the country’s capital of Mexico City.
The earlier 8.1 magnitude earthquake, the most powerful to hit Mexico in 85 years, has left at least 96 people dead. Thousands of homes in Chiapas and Oaxaca were damaged or completely destroyed. Relief efforts are underway for the 2.5 million people affected by the first quake.
Hurricane Irma Relief
Updated on September 11, 2017
Hurricane Irma will go down in history as the most potent Atlantic Ocean hurricane ever recorded. It left at least 26 people dead and thousands homeless across the Caribbean. The U.S. Virgin Islands suffered catastrophic damage. As a Category 4 storm, Irma also made landfall in the Florida Keys. It dumped rain across the entirety of Florida causing massive destruction and leaving millions without power.
Hurricane Harvey Relief
Updated on September 8, 2017
Hurricane Harvey is the state of Texas's worst storm in more than 50 years. The death toll related to the storm is relatively low at 70 people. However, Harvey and its record-setting rains caused severe damage in many parts of Texas and Louisiana. The recovery and rebuilding efforts in Harvey's aftermath are expected to take years.
South Asia Flood Relief
An estimated 41 million people throughout Bangladesh, India, and Nepal have been affected by unusually severe monsoon rains that have swept through the region this summer. The flooding – the worst South Asia has experienced in over a decade – has submerged vast areas of land and destroyed homes, schools, health centers, crops and livestock. Millions are displaced, and the death toll has reached over 1,400, with many people still missing.
Yemen's Cholera Crisis: Donor Alert
Over the past two and a half years, war has occupied the country of Yemen. Malnutrition and poor sanitation have made Yemen susceptible to many diseases that are no longer considered threats to populations in other parts of the world. Cholera has killed more than 2,000 people and has infected more than a half million people in the past few months of 2017.
Donor Alert: 'ACLJ' Is Two Charities Dominated by One Family
Christian Advocates Serving Evangelism (CASE), which according to its mission “is specifically dedicated to the ideal that religious freedom and freedom of speech are inalienable, God given rights,” raised over $51 million in total cash contributions in 2015. More than 70% of that $51 million came via direct mail and telemarketing services provided by professional fundraisers. Perhaps you have been solicited through the mail or over the phone to give to CASE. That name, however, may not be ringing a bell since CASE goes by “American Center for Law and Justice” or “ACLJ” to raise funds (not to be confused with the “ACLU,” American Civil Liberties Union, a distinctly different organization).
It is not at all strange for a charity to use a “doing business as” name that differs from its official name, as CASE does by using ACLJ. What is odd – and quite confusing – in CASE’s case is that there is another charity that has the official name American Center for Law and Justice.
Heavily Advertised Charity Comes Under Fire From CharityWatch and Minnesota Attorney General
Before you respond to the Kars4Kids infectious jingle, read CharityWatch's article, Costly and Continuous Kars4Kids Ads Disguise Charity's Real Purpose, check out our rating for Kars4Kids, and watch the CBS News segment featuring CharityWatch president, Daniel Borochoff.
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.
Famine Relief Efforts in South Sudan, Yemen, Nigeria and Somalia
Famine was declared in two areas of South Sudan in February 2017. This is the first famine to be declared in the world in over 6 years. Yemen, Nigeria and Somalia are also at risk for famine. A famine is declared by the United Nations when extreme criteria are met. These criteria include: at least 20% of households face extreme food shortages; acute malnutrition rates exceed 33%; and a death rate that is more than two persons per every 100,000 each day. Tens of millions of people are in need of food, but unfortunately are at the mercy of overwhelmed aid systems, continuing wars and widespread conflict.
In Yemen, over 7 million people need emergency food aid. Northeastern Nigeria faces severe acute malnutrition as at least 5 million people face the risk of famine. Somalia is currently in its second year of drought causing crops to fail. In South Sudan, the country's government and the United Nations have warned that over 100,000 people are facing starvation with an additional one million more at risk for famine. Currently, more than 40% of South Sudan's population (4.9 million people) has been described as severly food insecure, according to IPC, an international multi-agency initiative. Funding for aid is urgently needed in all of these countries.
Donor Alert: $16 Million Award Against WonderWork May Force It to Cease Operations
Two charities, HelpMeSee and WonderWork, remain embattled in a lengthy legal dispute over a services agreement that has resulted in a $16 million arbitration award against WonderWork that includes compensatory damages, attorneys’ fees, and arbitration costs.
While the dispute may be ongoing, what may not be ongoing for much longer is WonderWork, which filed for Chapter 11 bankruptcy protection on December 29, 2016. This protects the charity, at least temporarily, from paying creditors, including HelpMeSee. “Enforcement of the Arbitration Award would, for all intents and purposes, put [WonderWork] out of business,” WonderWork’s CEO, Brian Mullaney, stated in court filings.
Ghost Ship Fire Victims and Donors Ask: Where's The Money?
The San Francisco based nonprofit Gray Area Foundation for the Arts has raised over $900,000 through a YouCaring crowdfunding campaign to benefit the victims of the December 2, 2016 Oakland warehouse fire. In a report by NBC Bay Area that aired January 26th, Gray Area's founder admitted that the group has yet to disburse even a single dollar of those funds raised. Watch CharityWatch's President, Daniel Borochoff, question Gray Area's decision to undertake the administration of the donations.
Many charities across the US giving up your money to the marketers they hire
Watch CharityWatch President, Daniel Borochoff, talking on Fox News about what portion of your donation given in response to a telemarketing call goes to benefit a charity and what portion goes to a marketing company. Learn that even some highly regarded charities overspend on expensive telemarketing.
Vietnam Veterans Charity Shuttered; Millions in Donations 'Squandered'
National Vietnam Veterans Foundation (NVVF) is to permanently close and its former President & Founder will pay damages, return his severance, and be banned nationwide from handling charitable assets as a result of settlements reached with the New York Office of the Attorney General (OAG), according to a November 10th, 2016 OAG press release.
The OAG's investigation found that NVVF spent the majority of its millions in contributions on paying professional fundraisers and insider expenses. The former President & Founder, John Thomas Burch, Jr., admitted that NVVF had paid 90% of its donations to its fundraisers. Burch also admitted to deceptively marketing how money solicited for NVVF would be spent towards helping veterans.
NVVF had been consistently F-rated by CharityWatch. Watch CharityWatch analyst, Stephanie Kalivas, contribute to CNYCentral's report on NVVF: Veterans charity is under scrutiny: Know how to protect your charity donations.
UPDATE: On March 26th, 2018, the Attorney General of New York announced that his office reached a settlement that shuts down Menacola Marketing, Inc., a telemarketing company that solicited donations on behalf of NVVF and “other shell charities that exploited popular causes in order to line fundraisers’ pockets.” For more, please see the NY AG’s press release: Operation Bottomfeeder: A.G. Schneiderman Shuts Down Brooklyn Telemarketing Operation That Solicited Funds For Sham Veterans Charity.
CharityWatch gives Clinton Foundation an 'A' rating
Listen to CharityWatch President, Daniel Borochoff, discuss the Clinton Foundation on NPR's On Point.
Watch Daniel Borochoff discuss the Clinton Foundation and why it receives an "A" rating from CharityWatch in this CNN interview.
Also read Mr. Borochoff's comments in this CNN article: What is the Clinton Foundation and why is it controversial?
[Note: Feed the Children (FTC) has a long history of being rated an "F" by CharityWatch, as referenced in the CNN interview, but its grade improved to a "D" based on its fiscal year 2014 operations. It is correct, as referenced, that FTC spent 42% of its cash budget on programs in fiscal 2014, according to CharityWatch's analysis. FTC's grade has since improved to a "C+" based on its fiscal year 2017 operations, having spent 58% of its cash budget on programs.]
How Does CharityWatch Rate the Veterans Charities on Trump's Fundraiser List?
After much prodding from the media, presumptive Republican presidential nominee Donald Trump released a list of the veterans groups that received donations in connection with a fundraiser Trump held in late January 2016. While many groups were excellent choices, others were questionable or even outright poor choices based on CharityWatch's ratings.
Can You Spot Nonprofit Accounting Tricks?
Barron’s is urging donors “to be as rigorous in vetting nonprofits for accounting chicanery as you are with public companies trading on the stock exchanges.” Since nonprofits have the room to use "some fast accounting moves," it's up to donors "to ferret out such bad accounting practices.” CharityWatch helps donors see through nonprofit “accounting tricks.”
(Illustration credit: Brad Yeo for Barron's)
Charity Uses Kids' Pictures Without Permission
Charity that purports to rescue missing children does very little of it. Of its total spending 66% went to its professional fundraisers, 1% went to investigations, and none went to provide cash or other assistance to victims or their families. See CharityWatch president, Daniel Borochoff, point out red flags at Crisis Relief Network's family of charities on NBC News.
Fake Pledge Reminders Lead to Suit Against Veterans Charity Fundraisers
“Donors need accurate information to make informed decisions. It’s too bad this company resorted to sending fake pledge reminders and other deception,” said the Attorney General of Minnesota (OAG) in a May 2016 press release. The OAG’s release announced its filing of a lawsuit that accuses for-profit fundraiser, Associated Community Services, Inc. (ACS), of sending false “pledge reminders” to donors and making other deceptive statements in its fundraising solicitation campaigns on behalf of Foundation for American Veterans.
Michigan AG Alleges Firefighters Charity Is a Scam
Firefighters Support Services (FSS) is “another example of a sympathetic cause – firefighters and those losing their homes from fire – being exploited by scammers,” according to the Michigan Attorney General (OAG). The OAG has filed a Notice of Intended Action and Cease and Desist Order against FSS, accusing the charity of using misleading, deceptive, or false statements in its solicitations. FSS raised almost $4.2 million in funds from December 2013 - January 2016 based on telemarketing scripts that told call recipients that donations would be used to help firefighters get better equipment and help “families that have been burned out of their homes by providing them with food, shelter, and clothing” or “financial support,” according to the OAG.
Top Executives Fired at WWP: CNBC
Watch CharityWatch President, Daniel Borochoff, discuss Wounded Warrior Project in the wake of the firing of its two top executives on CNBC's Power Lunch.
Making Sense of WWP's Program Spending: Which Ratio Should You Believe?
Ever since the popular veterans charity Wounded Warrior Project (WWP) was accused of wasting donations on lavish spending in reports by CBS News and The New York Times in early 2016, WWP’s program percentage (i.e., the portion of WWP’s expenses used for its veterans programs) has drawn particular attention from many. Even Senator Charles Grassley of Iowa, Chairman of the Committee on the Judiciary, is questioning the level of WWP’s program spending. CharityWatch’s “C” rating of WWP is based in part on our calculation that WWP spends 54% of its cash budget on programs. Some of the other program ratios we have seen being bandied about range from about 60% to the 80.6% that WWP has vehemently defended.
Wounded Warrior Project: CBS News Investigation
Watch CharityWatch president, Daniel Borochoff, in Part 3 of a CBS News investigation that questions how much money Wounded Warrior Project is actually spending on veterans.
Yemen: Humanitarian Relief
Yemen has been added to the United Nations list of severe humanitarian emergencies, with twenty one million citizens in need of urgent help. Approximately 13 million Yemeni people are hungry and 15 million have no access to health care. An ongoing bombing campaign by Saudi Arabia began in March 2015. The armed conflict has claimed an estimated 3,000 lives, and is the biggest obstacle for relief groups attempting to reach the Yemeni people most in need of aid.
CharityWatch announces a list of highly efficient charities involved in efforts to provide emergency relief and humanitarian assistance to the people of Yemen.
Police Charity Scheme Is a Rip-Off
See CharityWatch's president, Daniel Borochoff question the worthiness of a Wisconsin police charity on NBC Milwaukee news.
Giving Pitfalls and Traps
Listen to CharityWatch's president discuss on Iowa Public Radio pitfalls and traps that donors may unwittingly succumb to.
F Rated Planet Aid the Subject of a New Investigation
"Alleged cult leader plays shell game with US foreign aid" is the title of the Center for Investigative Reporting's (CIR) in-depth investigation into Planet Aid, broadcast in March 2016. For years CharityWatch has warned donors about Planet Aid's financial reporting and has consistently assigned the charity low ratings for its low program spending and high fundraising costs. The CIR investigation asserts that "money from USDA grants, over $130 million, up to 70% was allegedly taken from the projects it was meant for and stripped from employees salaries," and attempts to answer the question, "for what?" Planet Aid's ties to an alleged overseas cult and millions in clothing sales to fund projects in Africa with few visible results are just some of the concerns raised by CIR as it traverses continents to follow the charity's cash.
FTC, D.C. and all 50 States Take Action Against F Rated Cancer Charities
Four charities which have consistently earned F ratings from CharityWatch, Cancer Fund of America (CFA), Cancer Support Services (CSS) (an affiliate of CFA), Children’s Cancer Fund of America (CCFOA), and Breast Cancer Society (BCS), have been charged with bilking $187 million from donors in four years. Charges are being pressed by the Federal Trade Commission (FTC) and 58 law enforcement partners from every state and the District of Columbia, in one of the largest legal actions to date against charity fraud.
Update: By order of a settlement announced March 30, 2016, CFA and CSS will be permanently dissolved. CCFOA and BCS settled in May 2015 and are in the process of being dissolved. Additionally, the individual defendants named in the May 2015 action have been banned from charity work for life under the respective settlement orders. The March 2016 settlement concludes the largest joint enforcement action ever undertaken by the FTC and state charity regulators.
The CharityWatch Hall of Shame now features defendant James Reynolds, Sr. and 24 of his family members for their web of deceitful charities. Our article Long Running Family Charity Scheme Exposed goes into more detail.
Many Congressionally Chartered Veterans Charities receive D's and F's from CharityWatch
Where do your donations go? Watch video that features CharityWatch's take on how some veterans charities are failing.
Dark Cloud Over Red Cross Blood Services Has Finally Been Lifted
After about 22 years, the U.S. Food and Drug Administration (FDA) has lifted its Consent Decree pertaining to the safety of the blood services operations of the American Red Cross, the nation’s largest supplier of blood products. A consent decree, in general, is a legal arrangement in which the government agrees to drop charges against an accused party who, without admitting guilt, agrees to refrain from certain activities.
Newsviews: Charity Donations
In these two videos CharityWatch president, Daniel Borochoff, offers advice on what donors should consider before giving money to charity.
Financial Sense Podcast featuring Daniel Borochoff on Wise Giving
Listen to a 30 minute podcast about how you can accomplish more with your charitable donations and also how to avoid getting ripped off.
Donors Should Research Veterans Charities Before Giving
Follow this link for a video and article featuring advice from CharityWatch president Daniel Borochoff. Donors should do their homework before donating to veterans charities to find out which ones are spending money efficiently on programs to benefit donors, and which ones have programs that don't duplicate benefits already provided by the Veterans Administration.
New York Attorney General Sues Children's Leukemia Charity For Deceiving Donors
From 2009 to 2013 National Children’s Leukemia Foundation (NCLF) raised nearly $10 million in charitable donations from generous donors throughout the United States. New York Attorney General Eric T. Schneiderman’s office has filed a lawsuit against NCLF, alleging that the group has used the vast majority of the donations they've raised for non-charitable purposes.
New Charity Failing to Help Kids with Cancer
CharityWatch president and NBC 7 San Diego investigate WishWarriors' alleged failure to provide any financial assistance to the kids they claim to help.
CharityWatch offers these tips when donating to a new charity:
- You need to be able to trust the people running it.
- Research the organizers online.
- Ask for the qualifications of the organizers and management. They should have relevant past experience.
Veterans Support Organization consistently rated F
CharityWatch criticizes Veterans Support Organization (VSO) for doing very little to help veterans.
Click here to watch CharityWatch president, Daniel Borochoff, and NBC West Palm Beach, FL investigators ask the founder of VSO tough questions about how it solicits and spends donations intended to help veterans.
Senator Calls for IRS Review of Veterans Charity
“[Wounded Wheels] talk a lot about helping veterans, but to date it doesn’t appear they’ve done anything to help a veteran,” Daniel Borochoff, president of the watchdog group CharityWatch, said last week after reviewing Wounded Wheels’ financial records. “It seems like a cool idea, but they really need to show some kind of benefit to veterans to justify this as a nonprofit.” – The Virginian-Pilot, 7/8/2015
Click here to read the whole story and see the letter written by Senator Mark Warner.
CharityWatch Takes a Tough Stand on Charities with High Assets
Navy Seal Foundation, aren't doing any favors for those who need help now. Charitable dollars are limited, having remained at about 2% of GDP for over four decades, while the needs of society are not. Charities that hoard the funds they raise and keep assets greater than three years worth of their budgets are making those donated funds unavailable to other groups with urgent needs.
CharityWatch President, Daniel Borochoff, spoke with the Virginia Pilot about downgrading charities that keep high assets. Click here to read the article.
Update: Greg Mortenson, Central Asia Institute
In April 2012, Montana Attorney General announced a settlement agreement requiring Greg Mortenson, author of Three Cups of Tea, to pay more than $1 million in restitution for financial wrongdoing at the charity he founded, Central Asia Institute. The very same three person board, which includes Greg Mortenson and is responsible for the mismanagement of CAI, is empowered with selecting its replacement board, according to the settlement reached with the Montana Attorney General. Read the CharityWatch article that sparked the investigation, and listen to Daniel Borochoff discuss the settlement agreement on NPR. For Borochoff's comments on how the nonprofit sector could be affected by shortcomings in the AG's settlement, read this AP article.
UPDATE: Click here to read about CharityWatch's additional concerns regarding Central Asia Institute.
Thrift Store Donations for Veterans Charity Investigated
Veterans benefit very little when clothes and household items are donated to Vietnam Veterans of America. Watch CharityWatch president talk with Portland, OR KATU TV investigators about CharityWatch's analysis of this F rated charity.
See our article Donors Intentions Violated at For-Profit Thrift Stores for more on the topic.
F rated Veterans Charity Busted: $24.6 Million Settlement with Attorney General
CharityWatch was the first to warn the public of a $8.4 million debt in 2008 and other serious problems with Disabled Veterans National Foundation (DVNF) in Millions in Future Donations to Vets Charity Will Pay Debt Owed to Vendors. The charity continued to dig itself into a huge debt to its professional fundraisers, reaching $16.5 million in 2012.
Only a tiny portion of DVNF's cash donations ever went to helping disabled veterans. CharityWatch applauds the New York AG Office for finally putting a stop to many of this group's bad practices.
Million Dollar Pay at Nonprofit Hospitals Is it acceptable for the head of a nonprofit to earn a seven-figure salary? Upon what criteria should a salary be based? A recent study in JAMA Internal Medicine reveals that a CEO at a nonprofit hospital earns, on average, about $600,000 a year and the median salary of a CEO at a large nonprofit urban hospital is over $1.66 million. Read more.
See the Top 25 Compensation Packages of charity officers, directors, trustees, and key employees. From the CharityWatch Rating Guide.
For details about one charity executive's unusual compensation package, read Eye-Popping Pay.
Lack of Disclosure Makes Giving to Televangelists a Risky Business
Large religious TV networks that repeatedly ask you for charitable donations are allowed to hide how they spend your dollars. If you want to know if your donation is used to fund TV broadcasting or charitable aid, a tax-exempt religious broadcaster does not have to tell you.
Know Your Options When Giving to the Red Cross
In the wake of any humanitarian disaster that hits the U.S., the American Red Cross (Red Cross) usually takes the lead in providing immediate and long-term disaster relief services. The Red Cross, though, has not been immune from criticism related to how it allocates the spending of donations contributed in response to disasters. Thanks to an October 23, 2013 agreement with New York's Attorney General, the Red Cross will give online donors clear options with respect to how their contributions will be used and provide transparency about such uses.
Leadership Booted at Dishonored Veterans Charity
Help Hospitalized Veterans (HHV), which earns an F rating from CharityWatch, has been sued by California's Attorney General. The AG shares CharityWatch's long held position that HHV's accounting gimmicks inflate the reported amount of contributions spent on program services to help veterans. As part of the settlement, officers and directors named in the suit must resign and pay restitution. CharityWatch has been critical of HHV for years, and puts the settlement agreement in context with our article Leadership Booted at Dishonored Veterans Charity. For more CharityWatch reporting on HHV, check out these past articles: