Top 10 Misleading Charities and their Scams

The Rich Ten

Typhoon Haiyan, one of the strongest tropical cyclones date, struck the Philippines in early November 2013, leaving behind a trail of mass destruction. With thousand dead, call for help has been raised by several NGOs and organizations worldwide. Donation requests have been posted on different social networks as well as some popular websites. Meanwhile, spammers have started taking advantage of the situation by sending email containing fake donation requests.  

Then, there are solicitors on the street and in the malls who offer you some heart-aching advise. They are paid to sign up people for a donation of $1-$2/month to the said salary. Your heart goes out to the people of the cause, but the whole thing makes you wonder: 1) who’s the third party involved; 2) how much of the money is actually going to the said charity; 3) how much of the money is going to solicitors.

We really have to be careful with how we spread our money. Not all charities are honest and pocket donations for themselves, before they disperse it to the charity in need.

10. Children’s Cancer Fund of America

Donations: $37.5 million / Solicitor Profits: $29.2 million

Children’s Cancer Fund of America is one of five Reynolds family charities that raises millions in the name of cancer, but spends most of that paying for-profit companies. Rose Perkins runs the charity. She was married twice to James T. Reynolds Sr., the 70-year-old patriarch who transformed Cancer Fund of America, a struggling charity, into a $35 million empire that pays executive salaries to at least a dozen of his family members.

In addition to the cash raised through fundraisers, the charity received a $50,000 cash grant from Reynolds’ Cancer Fund in 2010. Since it was formed, Children’s Cancer Fund has raised nearly $38 million and let professional fundraisers keep nearly 78 percent. The charity has given cash grants to patients of about $300,000 a year. It also reports shipping millions of dollars in donated medical supplies to developingnations each year through “gifts-in-kind” programs.

In 2011, Perkins was paid $227,442. Her charity reported giving about $265,000 in cash to nearly 1,500 children that year. The grants averaged less than $200 each and represented less than 5 cents of every dollar raised. The salaries and benefit packages for charity president James T. Reynolds, Sr. and his two sons and one son-in-law totaled  over $537,000.

9. American Association of State Troopers

Donations: $45.0 million / Solicitor Profits: $36.0 million

The nonprofit spent nearly $500,000 cash last year, most of it on members’ life insurance premiums. That means the police officers represented by the charity get only about 16 percent of the money raised. For nearly a decade, the average percentage of funds spent on direct aid to members has been much lower — only about 9 percent.

Since 2004, the organization has raised about $45 million and spent less than $4 million on member benefits. American Association of State Troopers has been disciplined by several regulators in various states for misrepresentations and fraud. Since 1994, it has paid more than $300,000 to settle these claims. Why they have not been shut down is above and beyond my head.

8. National Veterans Service Fund

Donations: $70.2 million / Solicitor Profits: $36.9 million

National Veterans Service Fund notes on its website that “war does not end on the battlefield.” Instead, the site goes on to say, American veterans and their families have been left without the help they need to overcome critical health and psychological problems at home.

National Veterans Service Fund says it offers guidance to veterans to help them qualify for aid they otherwise would go without. It also touts the “limited medical assistance” the charity hands out to needy veterans.

Those promises have helped persuade donors contacted over the phone and in mailers to give $70 million over the past decade. The for-profit solicitors paid to raise that money kept more than half. On average, the charity gave assistance it valued at about $500,000 a year to needy vets.

The percent going to professional solicitors has increased over time. In 2011, the charity raised about $9 million and solicitors kept nearly 82 percent of the total.

7. International Union of Police Associations, AFL-CIO

Donations: $57.2 million / Solicitor Profits: $41.4 million

This nonprofit charity organization employs professional solicitors to raise funds for its cause. Telemarketers call people across the country and tell them donations will be spent providing financial aid to the families of police officers who were union members. The group also gives scholarships to students seeking degrees in law enforcement.

But of the $57 million in donations given by the public over the past decade, over $0.72 of every dollar was spent paying the solicitors they hired. Less than half of one percent — about $28,000 a year — was spent on survivor benefits.

Recent campaign initiatives were far worse. In 2011, professional fundraisers kept about 92 percent of the $8.1 million raised. IUPA netted about $650,000.The group spent $25,000 on its cause that year, giving $15,000 in scholarships, $5,000 in death benefits and $5,000 to a handicapped children’s foundation outside Sarasota.

6. Breast Cancer Relief Foundation

Donations: $63.9 million /  Solicitor Profits: $44.8 million

When Donald G. Tarver formed the charity that would become Breast Cancer Relief Foundation, it was a chance to start over. He had been president of another cancer charity. It was accused by the IRS of paying too much money to its for-profit fundraiser.

But when Tarver started over in 1987, he hired the same fundraising company at Breast Cancer Relief Foundation and continued paying the corporation the vast majority of donations raised in his charity’s name. Breast Cancer Relief continued diverting millions away from cancer patients after Tarver’s death in 2002, when his brother and sister-in-law took over.

For the past decade, it has been one of the nation’s most wasteful charities, IRS records show. Over that time, it has raised nearly $64 million through professional fundraisers and allowed those companies to keep 70 percent of donations. Just more than 2 percent of donations raised were given directly to hospitals or to women in need of breast cancer screenings. The charity has also reported shipping medical supplies worth millions of dollars to Africa and Central America over the past four years.

5. Firefighters Charitable Foundation

Donations: $63.8 million /  Solicitor Profits: $54.7 million

Firefighters Charitable Foundation was created to provide financial assistance to people who have been affected by a fire or disaster. In the past 10 years, its professional solicitors have gotten the biggest pay days.  From 2002 to 2011, it raised $64 million in donations and paid $55 million of that to its solicitors. The charity spent less than 10 cents of every dollar raised on direct financial assistance to those in need. The charity’s founder, Louis Pelico, left the organization in 2006 because he said he couldn’t reduce fundraising costs and he just had enough. Enough of what? Scamming people?

4. American Breast Cancer Foundation

Donations: $80.8 million /  Solicitor Profits: $59.8 million

Phyllis Wolf began the charity American Breast Cancer Foundation in 1997 and presided over one of the most nonsense charities in the nation for 13 years. The charity lured donors by promising to pay for breast cancer screenings. Under Wolf, almost nothing made it to sick and dying women. Instead, she signed contracts with more than six professional fundraisers and paid them nearly 75 cents of every dollar raised. I wonder what her cut was in all this?

3. Children’s Wish Foundation International

Donations: $96.8 million /  Solicitor Profits: $63.6 million

Children’s Wish Foundation International is one of  many scam charities that try to copy the name and the mission of the well-established Make-A-Wish Foundation. Children’s Wish reported that it granted $600,000 in wishes to terminally ill children in 2010 and gave them donated goods valued at $3 million. It paid professional fundraisers nearly $6 million for their services that year. Yikes! People should know this as soon as possible!

2. Cancer Fund of America

Donations: $98 million /  Solicitor Profits: $80 million

Cancer Fund of America, which was established in 1984, claims in pledge letters that it is the main charity for fighting cancer. But its main activity has nothing to do with funding research or paying for cancer treatment. Instead, the charity collects donated goods such as Shampoos, toys, and tooth paste— and ships them across the nation to dying patients and the families who have no money left. What’s wrong with this? While gift baskets are made up of trinkets and toiletries for cancer patients and their families, for-profit fundraisers take home millions of dollars every year. The waste has been going on for decades. Year after year, the CFA raises millions and sends 82 percent to its for-profit fundraisers.

1. Kids Wish Network

Donations: $127.8 million /  Solicitor Profits: $109.8 million

Every year, Kids Wish Network gets millions of dollars in donations to help dying children and their families cope with the process. Every year, it steals almost every penny that comes their way. The money that is raised gets diverted to pay the charity’s executives and the telemarketing companies Kids Wish hires to drum up donations. Sick children wind up with less than $0.03 of every dollar raised. The phony charity has hired Melissa Schwartz, a crisis management specialist in New York City, who has experience working for the federal government after the 2010 BP oil spill. Schwartz said the charity has hired outside companies to do fundraising so that its staff can focus on wish-granting. Not much to report in changes, yet.

Others:

Youth Development Fund

Donations: $29.7 million /  Solicitor Profits: $24.5 million

Rick Bowen started Youth Development Fund 30 years ago. Youth Development Fund, Inc (YDF). is a non-profit general assistance fund for educational program and services for children. It claims to support an educational program concerning drug abuse, health and fitness and presents festival events for children and the general public, so that they will be more educated on the subject. It also purports a goal to have every school that has access to computers and the Internet to be able to access those educational programs. Everything about it is a LIE! Over the past decade, donors contacted by professional solicitors have given the Tennessee charity nearly $30 million. Youth Development paid those solictors 83 percent of the money raised. So what’s left for the programs its supposed to be funding? NOTHING!

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