In one of the largest charity fraud accusations in US history, four cancer charities allegedly used $187m of donations to buy concert tickets, cars, luxury cruises and even dating website memberships (it’s easy to see how they would struggle to settle down when they’re that morally bankrupt).
Law enforcement from all 50 states alongside the Federal Trade Commission are charging Cancer Support Services, Cancer Fund of America, Children’s Cancer Fund of America, and the Breast Cancer Society for using donations for personal gain. A number of high ranking executives are also facing charges.
The charities employed for-profit fundraisers who “typically” received 80 percent or more of every dollar raised, providing little oversight. Between 2008 and 2012, the companies reportedly raised $187 million, and they reported $120 million in fundraising costs. The four charities spent between 2.4 percent and 3.4 percent of their money on actual aid. That’s just $6.4 million in the best case.
The so-called charities used a variety of methods to raise money, including direct mail, websites, telemarketing calls and even had a department meant to raise money from federal employees in an attempt to appear legitimate. As is usual in these cases, the companies used dodgy accounting tricks to make it appear they had given out more money than they actually had.
In a press release from the Federal Trade Commission, they explained the money was used on:
Cars, trips, luxury cruises, college tuition, gym memberships, jet ski outings, sporting event and concert tickets, and dating site memberships. They hired professional fundraisers who often received 85 percent or more of every donation
As a result three culprits — Rose Perkins, James Reynolds II and Kyle Effler – have agreed a settlement that prohibits them from participating in any future fundraising activity. Children’s Cancer Fund of America and the Breast Cancer Society will also be dissolved as part of the agreement. Cancer Fund of America and Cancer Support Services, are yet to reach a settlement.
Jessica Rich, director of the FTC’s Bureau of Consumer Protection said:
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
Surely there should be harsher punishments than just dissolving the company and banning the culprits from fundraising. They are effectively getting away with murder. Lives could have been saved with that money and they will walk away scot-free.
Disclaimer: Please do not use this as an excuse not to donate to cancer charities. I don’t want to dissuade people from donating to the fight against cancer. However, I feel it is equally important to expose fraudulent charities, and raise awareness. Please take your time to do some research before donating.