Millions of Americans generously donate a portion of their paychecks each year, offering to help those in need while perhaps earning a chunk of good karma.
The US charity industry is worth well over $2 trillion, but many have no idea the sector is riddled with greed, and their good intentions could line the pockets of fat CEOs instead.
According to a study by the Tampa Bay Times and the Center for Investigative Reporting, America’s 50 worst charities passed on less than four percent of donations to their advertised recipients from 2003 to 2013.
In the same decade, six of them spent nothing at all on direct cash assistance.
From Black Lives Matter squandering their social media fortunes on a Los Angeles mansion to executives giving themselves lucrative bounty awards, these are reportedly the worst charities to give your hard-earned cash to.
Cancer Fund of America
The Cancer Fund of America achieved legendary status in the seedy fundraising business, giving less than 1 percent of the funds to its cause, according to the Times/CIR study.
In 2013, before its President James T. Reynolds was accused by the FEC of carrying out “one of the biggest charity frauds of all time,” the Cancer Fund of America was found to be among the worst offenders.
Reynolds, who also founded the now-defunct charities Cancer Support Services, Children’s Cancer Fund of America, and Breast Cancer Society, made no secret of the lucrative salaries he and his family received.
The Reynolds charity empire, in which James’ children ran several of the lucrative businesses, ensured that the family consistently took home six figures each.
James T. Reynolds, the president of the Cancer Fund of America, has been accused by the FEC of carrying out “one of the biggest charity scams of all time”.
However, like many generous charity directors, Reynolds’ charitable efforts were underpinned by for-profit fundraising, which built his empire at the expense of donations to his charities.
By hiring the services of fundraising attorneys, charities make huge sums of money through tactics like robocalling, with fundraisers then taking a huge cut, which can be as high as 80 percent.
This tactic enabled the Cancer Fund of America to raise over $7.7 million in its first year in 1984. Less than 10 percent went to actual cancer patients, while the rest was distributed to the Tampa Bay fundraisers and salaries of Reynolds’ family, according to the Times.
According to the Times/CIR study, from 2003 to 2013, the charity spent just 0.9 percent of its funds on direct cash assistance. To date, over $80 million has been paid out to for-profit fundraisers.
During the same period, the Reynolds family earned nearly $5 million in salaries and bonuses, compared to just $890,000 spent on cancer patients.
The shocking numbers earned the charity a spot on the list of the country’s worst charities of 2013, beaten only by the infamous Kids Wish Network.
Children’s Wishes Network
While the famed children’s charity Make a Wish has garnered fans through its star-studded efforts over the years, its eponymous rival has been criticized for chasing after it.
From 2003 to 2013, just 2.5 percent of funds were spent on cash assistance, earning her a zero out of four-star rating from tracking website Charity Navigator.
The organization spent a staggering $109 million on fundraising attorneys over the same period, according to the Times/CIR study. These funds are used for services including extensive cold calling operations. An additional $4.8 million went towards paying the charity’s founder and his affiliated companies.
Last year, over $499 billion was donated to charities across America — meaning if every organization were run the same way Kids Wish Network was run, just over $12 billion in donations would be allocated to their intended causes.
Former Kids Wish Network employees have criticized it as “more of a money, money, money business than a children’s organization.”
Former employees have spoken out against the company, claiming it takes advantage of sick and dying children for profit and then misleads people about what their money is being spent on.
They said about 70 “wishes” are granted to sick children every year, but the millions donated by the public are far from necessary to meet their needs.
Former employee Rhonda Erlo told the Tampa Bay Times she wasn’t surprised the company ended up at the top of the list of worst charities in America, and said people should look elsewhere for donations.
“I realized this was more of a money, money, money business than a children’s organization,” she said.
“There are better organizations that people can give their money to.”
Black Lives Matter
As of October 2020, Black Lives Matter was still struggling with the national attention it received following the killing of George Floyd.
Millions flocked from around the world as protests and demonstrations brought issues surrounding racism to the fore. But what happened to those millions has infuriated fans and the flow of money into BLM’s coffers has dropped dramatically. Donations fell 88 percent between 2021 and 2022, from $77 million to just $9.3 million last fiscal year.
Patrisse Cullors co-founded the movement in 2013 before stepping down in 2021. The organization is also at risk of bankruptcy after its finances plunged $8.5 million into the red last year while paying seven-figure salaries to several employees.
Financial disclosures obtained by The Washington Free Beacon reveal the perilous state of the BLM’s Global Network Foundation, which was formally established in November 2020 as a more formal way of structuring the civil rights movement.
But despite the financial controversy and scrutiny, BLM GNF continued to hire relatives of Cullors and several board members.
Cullors, 39, was expected to produce shows across the company’s various revenue streams, including animated films, children’s films, and scripted and unscripted shows.
Black Lives Matter sparked backlash after it was revealed the organization had used donations to fund a $6 million Southern California mansion (pictured).
The property’s patio and courtyard features an in-ground pool and cabana
Cullors’ brother Paul Cullors founded two companies in 2022 that received $1.6 million to provide “professional security services” for Black Lives Matter.
Paul was also one of BLM’s only two paid employees during the year, earning $126,000 as a “head of security” in addition to his consulting fees. He is best known as a graffiti artist with no experience in the security field.
Cullors defended his stance, saying registered security firms that hire ex-police officers cannot be trusted given opposition from the movement against police brutality.
For the previous year, 2021, tax returns revealed that BLM paid a company owned by Damon Turner, the father of Cullors’ child, nearly $970,000 to help with “producing live events” and providing other “creative… Services” to help.
“While Patrisse Cullors was forced to resign amid allegations of using BLM funds for her personal use, it appears she is still keeping it all in the family,” said Paul Kamenar, a lawyer for the watchdog group of the National Legal and Policy Center.
A consulting firm led by BLM Board Member Shalomyah Bowers received $2.1 million to provide operational support to the organization. Bowers said the last BLM board approved the deal with his firm before he was a board member.
The filing also revealed that Cullors reimbursed BLM $73,000 for a charter flight and paid the foundation $390 for private use of their $6 million Los Angeles mansion.
Bowers, who succeeded Cullors after her retirement, also benefited significantly from the group: In 2022, his consulting firm received $1.7 million for management and consulting services, Free Beacon reported.
And the sister of former Black Lives Matter board member Raymond Howard has also been employed in a lucrative role as a consultant.
According to Free Beacon, the firm received $1.1 million in consulting services from Danielle Edwards, New Impact Partners, in 2022.
BLM GNF also agreed to pay an additional $600,000 to the consulting firm of an unidentified former board member “in connection with a contractual dispute.”
The nonprofit group posted an $8.5 million deficit and its investment accounts lost nearly $10 million in value last fiscal year, according to financial disclosures.
The group posted a loss of $961,000 on a $172,000 security sale, indicating the group suffered an 85 percent loss on the transaction. Further details on this security were not disclosed.
A year later, in May 2022, it was revealed that Black Lives Matter had spent more than $12 million on luxury properties in Los Angeles and Toronto – including a $6.3 million 10,000-square-foot mansion in Canada that was acquired under an $8 million program “Foreign Scholarship.”
The Toronto property was purchased with grant money earmarked for “activities to educate and support black communities, as well as property purchases and renovations for charity.”
The group had announced that it would use the property as its Canadian headquarters, and it was now called the Wilseed Center for Arts and Activism.
The leaders of the movement, with funds from benefactors, invested nearly $6 million in a luxury mansion near Los Angeles.
Set on a manicured three-quarter acre lot, the property features a pool, tree-lined garden, outdoor fireplace, “butler’s pantry,” own miniature film studio, 24 parking spaces, and two separate guest houses adjacent to the main house.
Earlier in the year, also revealed that the group squandered $12.7 million on “professional fees,” according to its August 2020 application for tax exemption and nonprofit status. However, none of those reports included a record of the $6 million home purchase made months earlier.
In pushing for the odd purchase, BLM chief Patrisse Cullors slammed her spending spree, which she described as “racist and sexist.”
In response to the backlash, the group said, “There have been many questions about recent reports of the purchase of Creator’s House in California.” “Despite previous efforts, BLMGNF recognizes there is still work to be done to increase and ensure transparency that transitions in leadership are clear.”
BLM then blamed the media for the uproar and the “inflammatory and speculative” reports in which journalists examined the group’s financials and said they “did damage”.
The reports “do not reflect the whole of the movement,” the organization claimed.
Firefighters Charity Foundation
The Firefighter’s Charitable Foundation was established in 1991 to help families affected by fires and natural disasters.
In the three decades since, however, the company has faced allegations of financial mismanagement.
According to the Times/CRI study, the charity also received a zero-star rating from Charity Navigator and invested more than $54 million in fundraising advocates over a decade, but only donated 8.4 percent of its funds to actual fire victims.
The reason charities use for-profit fundraising is to raise as much as possible from potential benefactors. However, this practice has been criticized for lining executives’ pockets while deceiving donors.
“Some charities assume that if they raise $1 million by hiring a professional fundraiser and only keep $250,000 of it after paying the fundraiser’s fees, that $250,000 is what they wouldn’t otherwise have collected.” But that logic is unfair to donors, who don’t see this waste in the same way,” CharityWatch chief executive Laurie Stryon told .
The Firefighters Charity Foundation
“Charities should respect the intentions of donors by keeping their overheads reasonable.” A charity may legitimately use a for-profit, professional fundraising firm to supplement its other fundraising efforts or to build its membership base when it’s just starting out .
“But some charities rely on these companies year after year and never develop other, more efficient ways to raise funds.”
“They continue to pay 80% of every dollar they raise to these companies. It’s such a waste. In some cases, a charity’s only programs consist of “educational” information that they include in their direct mail donation letters or telemarketing calls.
“Donors are basically just funding more fundraisers and nothing else when they donate.”