Most people who give to charities never question the true impact of their good deed. After all, charities are in place to help people, right?
Unfortunately, some companies run charities more like businesses than non-profit organizations, and the money they collect doesn’t always go to the right place…
In a shocking press release, four major cancer charities allegedly used more than $187 million in donations to buy luxuries for their families and friends.
According to the Federal Trade Commission (FTC), this is one of the largest charity fraud accusations ever brought to date by U.S. Law enforcement.
The accused charities are none other than Cancer Fund of America (CFA), Cancer Support Services (CSS), Children’s Cancer Fund of America (CCFOA) and The Breast Cancer Society (BCS).
“Cancer is a debilitating disease that impacts millions of Americans and their families every year. The defendants’ egregious scheme effectively deprived legitimate cancer charities and cancer patients of much-needed funds and support,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection.
“The defendants took in millions of dollars in donations meant to help cancer patients, but spent it on themselves and their fundraisers. I’m pleased that the FTC and our state partners are acting to end this appalling scheme.”
Not only did these charities hire professional fundraisers, who often received 85% or more of every donation, the complaint also alleges that, to hide their high administrative and fundraising costs from donors and regulators, the charities falsely inflated their revenues.
By reporting inflated “gift in kind” donations, they created the illusion that they were larger and more efficient with donors’ dollars than they actually were.
And instead of helping people have access to cancer treatment and facilitate their care, these charities spent donation money to on cars, trips, luxury cruises, college tuition, gym memberships, jet ski outings, sporting event and concert tickets, and dating site memberships.
Virginia Attorney General Mark Herring summarizes: “The allegations of fundraising for personal gain in the name of children with cancer and women battling breast cancer are simply shameful…I hope it serves as a strong warning for anyone trying to exploit the kindness and generosity of others.”
Giving to charities is important, but so is doing your research to find the right organizations to donate to. The Federal Trade Commision suggest these steps to recognize a reputable charity. You can also read this New York Times article. Happy giving!