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Wednesday, June 19, 2013

Beware: Not All Charities are Charitable

By Heather Millar

exchanging money

This isn’t exactly a post about being a cancer patient. It’s a post about organizations that say they want to help cancer patients but really may not be.

Last week, the Tampa Bay Times and the San Francisco Bay Area-based Center for Investigative Reporting (CIR) released an outstanding report of America’s 50 worst charities. These “charities” spend most of their money on staff salaries, expenses and attorneys’ fees, while using only a few percent of their funds to the causes they say they work to support. Of these 50 worst on the report’s list, 10 are cancer charities.

I can’t tell you how angry this makes me. There are so many cancer patients who need actual help, who don’t have health insurance, who can’t afford to travel for treatment, who fall into a financial abyss when they get so sick that they cannot work, who need comfort and help running a household and help dealing with all the miserable side effects of cancer treatment. And then there are these charities who say they’re helping cancer patients but are spending little of the money they raise doing so.

Here are the 10 worst cancer charities, as listed in the report, with the amounts they  spent on helping cancer patients, based on tax returns from the last 10 years. The links connect to the investigation’s full profile on each one:

Cancer Fund of America: $98 million raised, 0.9% spent on direct cash aid.

American Breast Cancer Foundation: $80.8 million raised, 5.3% spent on aid.

Breast Cancer Relief Foundation: $63.9 million raised, 2.2% spent on aid.

Children’s Cancer Fund of America: $37.5 million raised, 5.3% spent on aid.

Children’s Cancer Recovery Foundation: $34.7 million raised, 0.6% spent on aid.

National Cancer Coalition: $41.5 million raised, 1.1% spent on aid.

Woman to Woman Breast Cancer Foundation: $14.5 million raised, 0.4% spent on aid.

Children’s Leukemia Research Association: $9.8 million raised, 11.1% spent on aid.

United Breast Cancer Foundation: $11.6 million raised, 6.3% spent on aid.

Hope Cancer Fund: $1.9 million raised, 0.5% spent on aid.

As the project says, watchdog groups generally agree that a charity should spend no more than 35 percent of its monies on fundraising costs. Apparently, there is little regulation of charities, and no legal standard on what charities should spend on aid.

The investigation also included links that will help you figure out how to donate to charities that do spend more of their money on the cause they say they’re helping, such as ProPublica’s non-profit researcher and Charity Navigator.

When considering making a donation to a charity, here are some questions to ask:

• Are there at least five members of the board that governs the charity?

• Are some of the board members compensated by the charity? A good rule of thumb is that no more than one person on the board, or 10 percent, whichever is greater, should make money from the charity.

• Does the organization have a policy of analyzing how effective it is? It should do so at least every other year.

• Does the charity spend at least 65 percent of its funds on program activities?

• Does the charity release public financial statements and annual reports each year? Do these reports include a breakdown that shows what percentage of funds are being used for administration, fundraising and program activities?

If you’re not sure about a charity that’s asking you for money, you can also check out the Better Business Bureau (BBB) Wise Giving Alliance. They analyze 1,200 national charities according to “Standards for Charity Accountability” (upon which the questions above are based). In addition, 54 of the 113 BBB offices in the United States and Canada produce approximately 10,000 reports on local charities. The national findings are collected three times a year in the BBB’s Wise Giving Guide.

How do you feel about this investigation’s findings? Have you given to any of the cancer charities spotlighted?

Posted by: Heather Millar at 2:55 pm

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