While altruism is wonderful and charities are (in most cases) worthy causes for those with big hearts, not all nonprofits live up to their name.
The truth is, depending on the charity, portions of donated money do not exclusively or even mostly benefit the cause – sometimes, profits go right into the pockets of nonprofit CEOs in the form of enormous salaries, into excessive fundraising spending, or questionable business tactics.
Charity Navigator pinpoints specific organizations that take extremely high salaries at the expense of spending dollars for their programs, leaving only 60% or less of donations for actual funding.
- Young America’s Foundation – CEO makes $525,960
- The American College of Obstetricians and Gynecologists – CEO makes $455,587
- Catholic League for Religious and Civil Rights – CEO makes $374,500
They also warn against the top charities that drastically over-pay for fundraising, which include
- The Cancer Survivor’s Fund, spends 89% of expenses on fundraising
- The Firefighters Charitable Foundation, spends 87% on fundraising
- The Committee for Missing Children, spends 84% on fundraising
Business Pundit also singles out a number of greedy charities that have questionable spending habits concerning donation money. These charities include the following:
1. Salvation Army
Despite being a nonprofit and charity, the SA is very much a business as well, and because it’s technically a church it’s exempt from declaring its revenues. The SA also owns a largely tax-exempt local real estate portfolio worth about $75 million, with which it houses high-ranking officers rent-free.[contextly_auto_sidebar id=”XGz9rxt9jtcJBOb8ga2aMr1TwnqQSbkH”]
These officers are also given cars, health insurance, and most other living expenses, according to the Tampa Bay Times. Some officers live in lavish households outside of the communities they serve.
The SA has also attempted to evict tenants of property in order to sell the space for profit, according to the N.Y. Senate website – displacing the very people the SA is supposed to protect.
Salvation Army spokesperson Major George Hood has said of the former controversy that the officers separating themselves from the communities are not the norm, and that the funding housing provisions are not taken from regular donations.
2. Coalition Against Breast Cancer
Charity Navigator has little good to say about this supposed “nonprofit.” NY’s attorney general filed a lawsuit to shut the organization down, calling it a sham charity for funneling the millions it raises to to insiders and fundraisers, putting forth only 18% to the cause.
According to news reports, the two people behind the organization plead guilty to grand larceny, having spend half a million dollars raised on vacations, fancy dinners, and other personal expenses including their daughter’s sorority dues.
Luckily, the charity was dissolved in 2013.
3. The Nature Conservancy
As one of the oldest and richest charities in America (founded in 1951), the Nature Conservancy is dedicated to the preservation of 119 million acres of land and is by most standards – even the Charity Navigator’s – doing a lot of good in the world.
Even so, it has not escaped the notice of critics that the environmental organization has close ties with big business corporations such as Dow Chemical, General Electric, and BP. It has also drawn criticism for drilling on protected land in Texas at the cost of the region’s endangered birds’ safety, while profiting off of the oil.
The Conservancy has also been known to buy property for preservation, only to sell it for less and accept the difference as donation, allowing for limited construction on sensitive environment, as well as tax-breaks for the buyers, according to the Washington Post.
The Nature Conservancy has responded to criticisms of their special relationships with oil companies by stating that such partnerships are part of a conservation strategy that helps improve business practices in places the Conservancy cares about.
Wounded Warrior Project
In 2016 a CBS News investigation looked into the spending of Wounded Warriors Project, the charitable organization that raises hundreds of millions of dollars each year to help American veterans. The CBS report found that the organization engaged in wasteful spending, using between 40-50% of donations for operational expenses, including lavish parties.
After the findings were released, the charity’s board of directors fired the Wounded Warrior Project CEO, as well as the Chief operating officer.