12 Worst Charities to Donate Money To

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charity-scams

There are many charities that do awesome work in their communities. Then there are charities which are just a funnel of money to administrators or board members and very little goes to the people who are in need. Many charities are actually a scam, but it can be difficult to recognize this because of the good work that they promote themselves performing.

If you’re thinking about donating money to a charity, stop right now. Here are the worst charities to donate to so you can avoid sending your donation into a money pit that doesn’t really help people who are in need.

#1. Kid’s Wish Network

Everyone wants to ease the pain of a child who is suffering. Many charities have been established to help collect donations to send these kids on the trip of a lifetime or to have specific wishes granted to meet someone. This charity was created to help children create memories with their families that they could cherish as they struggle with a serious illness. The only problem is that 97% of general donations don’t go to these kids.

If you look at their website, they specifically state that “100% of contributions directed to Kid’s Wish  Network’s Guardian Angel fund will go directly to supporting our kids through our services or programs.” This means your donation, which must be specifically directed to this program for it to apply, could be used for anything from teddy bears to funeral expenses.

The bottom line is this: when just $0.03 of general donations go to the kids and the rest goes to everyone else, then this is an organization that is taking advantage of sick kids and distraught families for their own benefit. Maybe that’s why they operate out of a warehouse instead of actual administrative offices.

$110 million has been given to corporate solicitors through Kid’s Wish Network. Another $4.8 million has gone to the founder of the charity. You decide for yourself if this is a scam.

#2. Cancer Fund of America

Here’s another charity that has solicited more than $100 million in donations over the last decade. When you donate to a charity that states it is funding cancer research, then you’re expecting your cash to go toward finding a cure for this terrible disease. That isn’t really happening with this charity.

More than $75 million has been given to corporate solicitors from donations that were meant to go to cancer research. Because the donations aren’t generally directed to a specific component of the charity, however, this gives the organization leeway to spend that cash in whatever way they wish.

Salaries alone for the Cancer Fund of America topped $8 million in 2011. The ownership group gets paid over $1 million alone. That’s up to 13x more than what the people who are suffering from cancer are actually receiving.

At one point, this charity even advertised an urgent need for pain medication to be given to critically ill patients. What did this charity purchase for these suffering people? Ibuprofen. You can get 400 tablets of 200mg ibuprofen at Walmart today for just $4. They also claimed to have shipped over $35 million in medical supplies overseas, but their distributors have no records of such shipments. They’ve paid over $500,000 in fines for these activities, but that isn’t stopping them.

Less than 1% of general donations goes to the people who need it. Is this a charity scam? You decide.

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#3. International Union of Police Associations

Unions are often pictured in a negative light these days, especially in conservative circles in the United States. Whether you’re for them or against them, there is no denying the potential scam that the AFL-CIO is pulling on people with this particular charity.

How bad is it? A class action lawsuit was filed in November 2013 against this organization for not using donations as intended – to help safety officers protect their interests. Nearly $60 million has been raised through the AFL-CIO and other sources for this charity, but allegedly only 0.5% of the donations are actually going to the public safety officers the charity was founded to support.

What’s worse than this? The fact that the International Union of Police Associations is using donations to pay private for-profit companies to raise even more money.

Membership with the IUPA is supposed to provide retirement benefits, health and well-being assistance, and even help finding mortgages, better insurance, or travel assistance. Do you think members realize that administrators are pocketing or distributing to others outside the membership more than 99% of the funds that come their way?

#4. The Red Cross

How could an internationally recognized charity founded by well-respected folks like Clara Barton be a scam? Easy. When the Haitian earthquake hit, the Red Cross sprang into action. They raised money, often $10 at a time through mobile donations, to the tune of $500 million. In return, they built just 6 homes in this ravaged country?

So what went wrong? It could be a colossal lack of oversight in the spending chain. The Red Cross admits that they sent funds for Haitian relief to many people who didn’t speak the native languages of the country. There are also claims that the money went to repairing homes, providing temporary food assistance, and constructing temporary shelters.

Even at the highest of cost estimates, this accounts for about $100 million of the $500 million that was raised to help Haiti. Where did that other $400 million of your money, asked for on national sports broadcasts and advertised constantly through Google AdWords and other providers, end up going? Nobody knows.

Would you trust a charity that somehow lost $400 million? Would you question if the Red Cross is participating in a charity scam?

#5. Youth Development Fund

Here’s another charity that is seemingly acting above the law – for more than 3 decades. That’s right – more than $30 million has been received from donors who are hoping to have an impact on the lives of at-risk youth. Instead 80% of the general donations that are received by this charity goes straight back to solicitors.

Rick Bowen is listed as the operator of this charity. He runs it out of his own condo. His charity also pays his own for-profit company, a production company that creates diving videos, an average of $200,000 every year. What does that income get you? A video channel that reaches about 3,600 viewers per week – but Bowen seems to think that equals 1.3 million people.

Bowen told CNN that there was nothing wrong with paying his own company to solicit for more donations. “We were the lowest bidder.”

If that doesn’t scream poor ethics and a scam, nothing will.

#6. The Wounded Warrior Project

Compared to some of these other examples, the Wounded Warrior Project sounds like a saint. After all, they do use more than half of the donations received to help wounded US veterans be able to get back on their feet. That’s pretty good, right?
Sure – until you look at their tax records. On their 2012 tax return, this charity reported receiving donations in excess of $234 million – in just one year. That means $115 million every year is being spent on other costs.

So what are those other costs? There’s the $6 million which was spent for charity employees to travel. Another $6 million was spent on “occupation costs.” They spent $5 million on IT needs. $15 million was spent for “office space.” They spent $17 million on meetings and events, not for the veterans they serve, but for themselves. More than $30 million was sent to consultants and an almost equal amount was paid out for employee salaries.

We’re talking about soldiers and their families who have literally sacrificed life and limb to protect the people who are running this charity. Soldiers who faced down terrorists, insurgents, and radicals who tried to blow them up with IEDs. So sure – they spend over $100 million per year on veterans. They’re also spending that much on themselves.

Does that make this charity a scam? If you have to look at the tax documents to see what money is being spent on because the organization isn’t fully forthright, then the definition may certainly fit.

#7. Children’s Wish Foundation International

Here’s another charity clone of the popular Make-A-Wish Foundation. It’s a common trick you’ll find amongst many of the world’s worst charities – make your charity sound just enough like another charity so people will connect the dots on their own and make a donation.

To be fair, this charity actually spends more on direct cash aid than any other charity in the Top 25 worst charities that are ranked by the Tampa Bay Times. Being the best of the worst, however, is not an award plaque that should be posted at your home offices. Just a little more than 10% of direct cash aid goes to the children this charity promotes itself as supporting.

So if it has the highest percentage of aid, why is it ranked so highly here? Simple. This charity raises over $90 million per year in donations. Out of that amount, more than $60 million goes to solicitors. This means $2 out of a $3 donation goes to the outside solicitors. Just $0.30 out of that donation actually goes to kids who are in need. You do that math.

#8. Project Cure

Here’s another clone that’s based out of Florida. The international charity Project C.U.R.E. has a consistent 4 or 5 star rating when it comes to how donations are handled. Go to Lena Road in Bradenton, Florida and your experience is likely to be a little different. Operated by Michael Evers, there’s a good chance that you won’t even see any furniture in the offices of this charity, much less an employee actually at the office doing the work they say is being done.

In fact, you won’t find any money going to research Alzheimer’s Disease, diabetes, or lung cancer. It simply “educates” people about these diseases even though there isn’t a laboratory, a research center, or virtually anything else to help develop new treatments.

And then there’s the fact that they lobby Congress about these issues.

There is some good news about this charity: people are wising up. In 2005, more than $6 million was received. In 2011, only $560,000 was received. In that 2011 figure, Evers received a $200,000 salary. 90% of the money being raised by this charity today is going back to pay the solicitors who are raising money for it. If this figure is above 35%, then it’s too high.

If you go into the alternative business names that this charity also operates under, you’ll find it to be part of a $2.1 million lawsuit settlement over misleading practices. Forget promoting alternative health therapies. Find a different charity.

#8. Woman to Woman Cancer Foundation

Here are some figures taken from this charity’s lifetime financials as of the 2013 reporting period. They speak for themselves.

Woman to Woman Breast Cancer Foundation has paid: $13.7 million to solicitors, $763,278 cash to the charity, $58,708 to direct cash aid.

That’s right. Out of over $14 million raised, less than $60,000 in direct aid to women needing mammograms and other breast cancer screening tools or medical visits has been paid. Considering the founder, Jacqueline Gray, is a breast cancer survivor, one wonders how this money-making machine is paying themselves 10x more than the women they are supposed to serve.

Gray founded the charity in 2007 and it couldn’t raise any donations. Along comes a telemarketing company who says they’ll promote the charity, but only if they pay 90 cents on the dollar for every amount raised. Gray agrees, but then ends up paying out 95% of incoming donations back to the solicitor.

Why? Because the solicitor also loaned them some start-up money and provided some help with their marketing. This is why charities are a scam. If you make a donation to this one, just 3/10 of a cent is going to help women in need. Is that really how you want to spend your charitable donation?

#9. American Breast Cancer Foundation

With $4.2 million spent on services for women suffering from breast cancer, at first glance this charity seems to be pretty good. Then you realize that the charity has raised over $85 million in total donations since its founding in 1997. Now consider the fact that 75% of incoming donations go right back to the solicitors who generated the funds or that out of the $85 million, nearly $20 million went back into the charity for various expenses.

Not only does this make the $4.2 million almost meaningless, this charity just doesn’t care what people think about it. From its founding until 2013, it was named one of the most wasteful charities in the US 13 times. That means it has been named one of the nation’s worst charities 13 out of 16 years in this time period.

If your charity was named as a “bad” charity, wouldn’t you try to change your ways? Wouldn’t you look for new ways to provide services, cut expenses, or reduce the percentage of cash that goes back to your solicitors? Not this one. Apparently they like the cash flow.

The more you know… the more you realize that charity scams are more common than you might have ever realized before.

#10. The Committee For Missing Children

If exploiting dying children and cancer survivors wasn’t bad enough for you, then here’s a lovely charity for your consideration. They raise money to help find missing children. Or at least that’s what they’d like you to believe.

This husband and wife team pulled down a reported $110,000 in salary through their August 2014 financials. They’d raised $16 million, but sent more than $13 million back to the solicitors who had generated some cash for them. Out of that total amount, just $202,000 had been spent on program services. Do the math.

Now sure – if you check their website, you’ll find some pictures with reported success stories where kids have been found. It touches the heart. It also creates an urge in the average person to donate money to help find more kids.

Except when you look at what they actually do, they’re not working to find missing kids. They are a “parent advocacy group” which works to make sure parents “have their rights protected.” The state of Georgia is not amused. The Attorney General in that state has given this charity a red flag warning, indicating that they believe it is a scam.

If they can send out billions of pictures of missing kids with just $202,000, imagine what they could do if they spent $6.5 million on program services – just 50% of incoming donations. Makes you think twice about who is getting your next charitable donation, doesn’t it?

#11. Heart Support of America

Cardiovascular disease is one of the leading killers of people around the world. It often challenges cancer for the #1 spot in the United States. Numerous charitable causes exist to help find a way to defeat this deadly disease. Maybe just not this charity.

Here’s why: according to their most recently available IRS 990 form, this charity raised $2.3 million in donations over the course of the reporting year. Out of that amount, $1.9 million was listed as being paid out in “fundraising costs.”

So that leaves $4 million still for program services, right? Wrong. In the filing, Heart Support of America provided just $200,000 to program services. They spent $517,000, however, on administrative expenses. 10% of those admin expenses go to pay the salary of Laura Boyd, who is listed as the President of the charity.

Now we should give this charity at least a little credit. They came close to doubling the amount of money sent to program services in 2014 compared to 2013 numbers with less incoming revenue. Considering it was founded by Jim Halliburton after he’d had a massive heart attack, you’d think there might be a little more sympathy [and money] going to those in need.

But hey – at least there’s an online application form for aid. That’s better than most of the other charities on this list.

#12. VietNow National Headquarters

Veterans helping veterans… sounds like a wonderful concept. Should veterans receive just 3% of the donations that are brought in as direct cash aid? In the last decade, this charity has raised a total of $18 million and paid their telemarketers $16 million in return. The average amount that veterans receive from this charity is just $32,000 per year.

Maybe their publication, This Is VietNow, can help to make up for some of that lack of donation sharing. They’ll even ask you to contribute to their 24 page publication. It’s just not clear if they’ll pay you anything for the materials you provide.

Getting paid in exposure is the same as getting paid in cash, right?

The State of Illinois thought this all seemed a little non-ethical, so they filed suit against the contract the charity signed with their telemarketer in 2003. The courts ultimately decided that setting a specific percentage of fundraising donations was a protected First Amendment right.

In other words, charities who solicit donations from you for a good cause, but then spend that money on their solicitors, are just practicing their free speech.

So in conclusion, here’s some more free speech to think about. Research a charity before giving them a donation. Make sure they aren’t sending a ton of cash to telemarketers. Your goal in providing a donation is to help people in need – not to fund somebody’s huge salary so they can live well while you’re struggling to get by.

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Marc is the founder of Vision Launch Development Group. Vision Launch was created to inspire, empower, and promote social entrepreneurs – and be a vehicle for positive change in the world. Marc is strong proponent of individual freedom, economic empowerment and decentralized peer to peer solutions.