Wednesday, April 16, 2014

An Unregistered Sandy Relief Fund Raised Hundreds of Thousands of Dollars...Got Caught

by Gary Snyder

An unregistered Hurricane Sandy charity ended up actually donating a good chunk of the money that it raised—due to the intervention of the state government. 

A couple in Sparta, New Jersey adopted a great name for a disaster relief charity—the Hurricane Sandy Relief Foundation—and raised $334,000, but their organization was never a 501(c)(3). All the donor-education information produced by nonprofits doesn’t necessarily seem to have worked when it comes to preventing unregistered nonprofits from raising huge amounts of money under the guise of disaster relief.

One of the two founders, John Sandberg, told the Star-Ledger by e-mail that the organization distributed over $500,000 in goods throughout the tri-state area affected by the Hurricane. An AG’s court-appointed administrator, however, just recently awarded four grants totaling $225,000 of the Foundation’s money to O.C.E.A.N. in Toms River (which is building single-family homes), a food bank in Neptune to assist in rebuilding its food pantries, the Alliance Center for Independence in Edison for post-Sandy projects to help people with disabilities, and a fourth group in Rockaway, N.Y., called Graybeards. The court administrator plans to award another $100,000 soon.

According to the complaint filed by the Division of Consumer Affairs, Sandberg and Terraccino were no slouches. One day before the state’s emergency order and three days before Hurricane Sandy actually hit, Sandberg registered 110 Sandy/Relief domain names including words like “Sandy,” “Relief,” “New Jersey,” and “Fund.” (This wasn’t his first time; he did it 2011, too, registering domain names in Hawaii after a tsunami hit the islands.) In setting up his Hurricane Sandy website, Sandberg coded the site so that it would outrank other similar organizations in Google searches.

This shows how easy to convince donors to donate generously during times of emergency and disaster even if the charity isn’t on the level. In this case, the state government was on top of this situation within months, but that didn’t stop the group from raising more than half a million under the guise of disaster relief. (source)







Nonprofit Imperative gathers its information principally from public documents...some of which are directly quoted. Virtually all cited are in some phase of criminal proceedings; some have not been charged, however. Cites in various media: Featured in print, broadcast, and online media outlets, including: Charity Navigator, Vermont Public Radio, Miami Herald, National Public Radio (NPR), Huffington Post, The Sun News, Atlanta Journal Constitution, Wall Street Journal (Profile, News and Photos), “Betrayal”, (a movie), NBC (on Charity Fraud…TBD), FOX2, ABC Spotlight on the News, WWJ Radio, Marie Claire, Ethics World, Aspen Philanthropy Newsletter, Harvard Business Review, Current Affairs, Charity Navigator, The Chronicle of Philanthropy, St. Petersburg Times, Board Room Insider, USA Today Topics, Accountants News, Newsweek.com, Responsive Philanthropy Magazine, New York Times, Portfolio Magazine, The Virgin Islands Daily News, NANKAI (China) BUSINESS REVIEW, National Religious Broadcasters newsletter, The Charity Governance Blog, American Chronicle, Palm Beach Post, Detroit Free Press, Oakland Press, Nonprofit World, Socially Responsible Business Forum, PNNOnline, Ohio Nonprofit Resources, Nonprofit Good Practice Guide, Nonprofit Startup Guide, Nonprofit Blog, National Coalition of Homeless Newsletter, Finance and Administration Roundtable Newsletter, MichiganNonprofit.com, CORP! Magazine, Crain’s Michigan Nonprofit, ncrp.org, PhilanTopic, Nashville Free Press, Nonprofit Law Blog, Seniors World Chronicle, Carnegie Reporter, Assoc. of Certified Fraud Examiners Examiner, msnbc.com, Worchester (MA) Telegram and Gazette, Carnegie Corporation of America, EO Tax Journal, Wikipedia: Non-profit Organizations; Parent: Wise Austin, Accountants News, Veterans Today, Answers.com, Far-roundtable, #Nonprofit Report, nonprofithelpnews, nonprofit news; National Enquirer, Northwest Herald, The HelpWise Daily, The #Nonprofit Report, Wikipedia (Nonprofit Organization), Answers.com, Nonprofits: On the Brink (2006) Silence: The Impending Threat to the Charitable Sector (2011)
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