Donation Misdirection

It has always been difficult for donors to determine how effective and efficient the charities they support are, though over the past several years the online capability of investigation from many groups like Give Well, Charity Watch, Guidestar and Charity Navigator has helped considerably.

This article in the New York Times examines some donations that might be misdirected.

An excerpt.

“This holiday season, Americans will dig into their pockets for good causes. But these gifts will sometimes benefit charlatans or extremists, or simply be wasted.

“Partly that’s because religious giving — and a good deal of casual secular giving — isn’t vetted as carefully as it should be. Researchers find that religious people on average donate more of their incomes than the nonreligious, and Christians, Jews and Muslims alike write checks to charities that they assume share their values. Dangerous assumption.

“Some well-meaning Christians will support Feed the Children, a major Oklahoma-based Christian charity that describes its mission as providing food and medicine to needy children at home and abroad. By some accounts it is the seventh-largest charity in America.

“But the American Institute of Philanthropy, a watchdog group that also runs Charitywatch.org, lists Feed the Children as “the most outrageous charity in America.” The institute says that Feed the Children spends just 21 percent of its cash budget on programs for the needy — but spends about $55 to raise each $100 in cash contributions.

“Feed the Children also has been the subject of troubling litigation and investigations. The Oklahoman newspaper says that in 2007 the charity spent $1.2 million on a house used by the founder’s daughter, a charity executive until she was fired this year. It also said that Feed the Children once lent $950,000 to a framing business headed by the founder’s son, and that the charity has sued the son for allegedly helping strip a warehouse of $5 million in materials. The son has denied the allegations in the suit.

“In addition, the institute says that Feed the Children inflates the value of food and medicine to make it seem as if it does far more than it actually does.

“Tony Sellars, a spokesman for Feed the Children, shrugged off the accusations as a disagreement about methodology and said that the lawsuits were being resolved. “We’ve helped 200,000 families in America this year alone,” he said. “The opinions we value are those of the people we’re helping.”

“Meanwhile, American Jews sometimes support nonprofits that actually make peace for Israel less likely. A few days ago, the Hebron Fund had a gala fund- raiser in Manhattan, and some of those who attended probably thought that they were supporting Jews trying to live peacefully. In fact, the Hebron settlement is notorious for extremism and violence against Palestinians. (The settlers disagree, saying that the problems arise because Palestinians want to kill them.)”