So Sad...the Red Cross Saga Continues

by Gary Snyder

Rep. Bennie Thompson said it is “critical” for the Red Cross to act quickly in response to problems reported by ProPublica. 

The key congressman who sits on a committee that oversees the American Red Cross is pressing the group’s chief executive for information about how layoffs and other cuts have affected its ability to respond to disasters. In a six-page letter sent Wednesday, Rep. Bennie Thompson, D-Miss, cites ProPublica’s recent reporting on Red Cross Chief Executive Gail McGovern as well as previous coverage by us and NPR on the charity’s responses to Superstorm Sandy and the 2010 Haiti earthquake. 

“Given the Red Cross’ important role in responding to both domestic and international disasters, it is critical that it acts quickly to address the serious problems ProPublica, NPR, and the GAO uncovered this year,” Thompson wrote, referring to a Government Accountability Office report that found the charity would benefit from more scrutiny from the federal government. Thompson has requested copies of any internal Red Cross after-action reports assessing the group’s responses to the recent Valley Fire in Northern California and disasters in West Virginia, which have been the subject of local criticism. 

For major disasters, the Red Cross typically produces after-action reports but does not release them to the public. 

On the international front, Thompson is requesting more information about what the Red Cross has done in Nepal following the April earthquake. McGovern recently wrote a blog post stating that the charity “played a leading role in supporting relief operations in Nepal.”Thompson has asked for details on how much money the Red Cross raised for Nepal and what it has been spent on. “How did the lessons learned from the Red Cross’ response to Haiti inform its activities in Nepal?” it continues.
(ProPublica)


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)

Child Leukemia Charity Closed After Millions Lost

by Gary Snyder

New York State attorney general reached a settlement to permanently close a child leukemia charity accused of fraud.

The attorney general will also recover $380,000 dollars from the foundation, most of which will be directed to charities helping children with leukemia. The founder forfeited claims to an additional $612,844 in back pay, in addition to a claim to a lifetime pension and other benefits.

The foundation collected $9.7 million from 2009 to 2013. Some 80 percent of the money went to telemarketing and direct-mail fundraising campaigns, and only $57,451 was paid out in direct cash assistance to leukemia patients.

The foundation also fraudulently claimed to have a bone marrow registry and cancer research building in Israel.

The president of the foundation, until his resignation in 2010, had been convicted of bank fraud in 1999. The foundation’s accountant took over as president, but the original founder and president continued to run things. He established the foundation in 1991 after losing a son to leukemia. He paid himself $595,000 in salary and $600,000 in deferred compensation from 2009 to 2013, and a lifetime pension of more than $100,000 a year.

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)

Another Massive Vets Charity Fraud

by Gary Snyder

A former bookkeeper for the National Veterans Service Fund in Darien (CT) has pleaded guilty to charges related to her stealing about $800,000 from the organization.

She pleaded guilty to wire fraud and tax evasion offenses for her embezzlement.

The NVSF provides social services and medical assistance to veterans from the Vietnam and Persian Gulf wars, as well as their families.

Police said she started at NVSF in 2008 and was responsible for payroll and disbursement of funds to clients. She is accused of writing unauthorized checks to herself and family members for personal expenses, though she tried to cover it up by claiming the money was given to veterans in need.

The tax evasion charge is due to her not reporting the embezzled money on her federal tax returns, resulting in a federal tax loss of more than $270,000.

The theft spanned over five years, from January 2009 to June 2014.

Where was the Board; where were the audits?

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)

American Red Cross Implosion. Will it survive loss in revenues, staff, chapters, volunteers and confidence?

by Gary Snyder

Under Gail McGovern, the Red Cross has slashed its payroll by more than a third, eliminating thousands of jobs and closing hundreds of local chapters. Many veteran volunteers, who do the vital work of responding to local fires and floods have also left, alienated by what many perceive as an increasingly rigid, centralized management structure.

In 2013, losses were mounting. The organization ran a $70 million deficit that fiscal year and has been in the red ever since. Internal projections say the charity will not break even before 2017. But such projections have not served the organization well. All of this despite a projected billion-dollar jump in revenue, powered by expanded fundraising and growing profits from fees paid for CPR classes, swimming lessons and training materials.

Special government oversight of the charity’s blood-banking operation, which collects and sells blood to hospitals has cost the organization tens of millions of dollars in fines. A federal judge ended two decades of such oversight. The blood unit, which is the Red Cross’ largest division, is a $100 million drag on the charity’s bottom line, in part because changes in medicine have sharply reduced the demand for blood. In its statement, the Red Cross pointed to those changes as the reason for the charity’s recent deficits.

When McGovern was hired as CEO, there were over 700 Red Cross chapters across the country. Today, there around 250, though some former chapter offices stayed open even as they were folded into other chapters. The Red Cross declined to say how many offices it closed.

The number of paid employees fell from around 36,000 to around 23,000. Amid layoffs, bonuses given have raised eyebrows within the Red Cross, a former headquarters official said.

An internal survey obtained by ProPublica found volunteers around the country had a satisfaction rate of 32 percent this year — down 20 points from last year.

Between 2001 and 2008, the organization went through six interim or permanent leaders, several of whom departed amid allegations of mismanagement and misuse of donated funds.

In 2007, the Red Cross board, led by Bonnie McElveen-Hunter — a wealthy Republican donor appointed by President George W. Bush in 2004 — recruited Bush administration official Mark Everson as the CEO who would bring stability to the organization. Six months later, the board forced Everson out after the affair with his subordinate, touching off yet another round of embarrassing headlines.

(propublica)

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)

Oh No! Report: Another Priest In A Big Embezzlement

by Gary Snyder

Just last month, Nonprofit Imperative had a story about a priest in Michigan that admitted to stealing almost $600,000 and was sentenced to 27 months in prison.

Now another Catholic priest is in the news having swiped collection-plate donations to pay for drug-fueled sex romps, “illicit and prescription drugs” a $264,000 home in Brick, NJ, and paid $1,075.50 a month for a East Harlem apartment, court papers say. 

In addition to skimming $20 bills from the collection plate there, Rev. Peter Miqueli ripped off money raised to buy a new pipe organ at his former church.

He also put his sex friend in charge of the Cabrini thrift shop, where Miqueli “misappropriated and diverted money . . . for his own personal use” and destroyed financial records to cover up the theft, the suit says.

The best guess is that he took $2 million from two parishes.

The suit, which was filed in Manhattan Supreme Court also charges that the Archdiocese of New York and Cardinal Timothy Dolan knew about Miqueli’s “illegal scheme” and did nothing for a period of nine years. (nypost.com)

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)