The American Red Cross Won't Open Up To Public Scrutiny....what is it hiding?

By Gary Snyder

“The public deserves and needs to know that money is going for which it is intended;” citing the troubled Red Cross responses after Hurricane Katrina, the earthquake in Haiti, and Superstorm Sandy, said Rep. Bennie Thompson, D-Miss. in an interview.

Though the Red Cross has a government-mandated role responding to disasters, “no regular, independent evaluations are conducted of the impact or effectiveness of the Red Cross’s disaster services,” the Government Accountability Office report found.

The inquiry cites reporting by ProPublica and NPR about the Red Cross’ failures during Superstorm Sandy and misleading statements by CEO Gail McGovern about how the group has spent hundreds of millions of donated dollars.

The 18-month GAO examination was requested by Rep. Bennie Thompson, D-Miss. He authored the proposed legislation. The bill would require regular government audits of the Red Cross’ finances, its response to disasters in the United States, and its work abroad.

The audit was not easy. “When you get pushback from the very beginning it creates doubts and suspicion”, Representative Thompson said. The head of the GAO’s inquiry, Andrew Sherrill, said the Red Cross did not give “unfettered access” to investigators. Still, he said the GAO was able to get the information it needed. The report notes that while it reviewed Red Cross policies, it “did not assess the effectiveness or sufficiency” of the charity’s work.

In addition, American Red Cross CEO Gail McGovern tried unsuccessfully to get Thompson to shut down the inquiry by the GAO, which is the investigative arm of Congress.

The charity is also facing pressure from Sen. Charles Grassley, R-Iowa, to answer questions about its Haiti response.

In a written response, the Red Cross said it “believes there are several already existing mechanisms in place to evaluate our disaster response that provide considerable oversight.” The statement cited the group’s ombudsman office, its board of directors, and regular after-action reviews. (ProPublica)

The Red Cross was chartered over a century ago by Congress and operates as a public-private hybrid: While it is funded mostly by private donations, it has an official role in the United States’ disaster response plan. The Red Cross receives a variety of benefits from the government, including tens of millions of dollars in funding in recent years. It also enjoys a one-dollar, 99-year lease on government land in Washington the charity uses for its headquarters.

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)