Sue M. of Boca Raton recently wrote in to ask: “I feel guilty every time someone calls for a donation to some cancer charity, but how can I know which charity is real and which is a scam?”
Just last week, the Federal Trade Commission (FTC) along with regulators from 50 states and the District of Columbia charged four US cancer charities with fraud, accusing them of diverting almost all of more than $187 million in charitable donations.
The four charities named for running scams are: Cancer Fund of America (CFA), Cancer Support Services (CSS), Children’s Cancer Fund of America (CCFOA), and the Breast Cancer Society (BCS).
Telemarketers led consumers to believe that money they donated to these organizations would help cancer patients by taking them to their chemotherapy appointments, defraying costs for pain medication and supporting hospice care. In fact, less than 3 percent of any of the donations went to any direct cancer care.
According to the complaint in a lawsuit filed in federal court, the charities spent the bulk of the millions of dollars raised on huge salaries and bonuses to the CEO, his friends and family, as well as such luxuries as cars, cruises, gym memberships, jet ski outings, sporting event and concert tickets, and dating site memberships. Professional fundraisers often received 85 percent or more of every donation.
CSS, CCFOA and BCS were spin-offs from CFA which was founded in 1987 by James Reynolds Sr. who is still President. These three charities employed a number of family members, friends, and members of Reynolds’ church in Knoxville, Tenn. Reynolds’ son, James Reynolds II led BCS while his ex-wife, Rose Perkins, was President of CCFOA.
Because this is a civil and not a criminal action, the penalty can only be monetary. The plaintiffs are seeking over $100 million in fines against the charities and their executives. Sadly, most of the donated money is gone and so far no criminal charges have been made.
At best then, this should serve as a cautionary tale for Floridians like Sue M. who are solicited for charitable donations by phone, on the web, or in person.
As this column pointed out in the past, not all charities get an A – even those that are not scams.
One of the best ways to support cancer related organizations is to take time to research specific research entities and cancer foundations before being asked for donations. Charity Navigator has a databases of over 8000 nonprofits. Guidestar has a similar site.