The Federal Trade Commission (FTC) along with the Attorneys General for all fifty states just settled fraud claims against two bogus charities, the Cancer Fund of America and the Cancer Support Services as well as the man behind these phony charities, James Reynolds Sr.. According to Jessica Rich of the FTC, “The FTC and our state enforcement partners have ended a pernicious charity fraud that siphoned hundreds of millions of hundreds of millions of dollars away from well-meaning consumers, legitimate charities and people with cancer who needed the services the defendants falsely promised.” According to New Mexico Attorney General Hector Balderas, Reynolds and members of his family also involved in the phony charities used the funds collected primarily to fund “luxurious lifestyles and for their own personal gain.”
The settlement, which has been incorporated into a court judgment requires the charities to be liquidated and the funds received, after reimbursing the costs of the investigation and legal costs incurred by the FTC and the states, will be donated to legitimate cancer charities. Also pursuant to the settlement, Reynolds is banned from any involvement with charity affairs. However, no criminal charges were brought against him. Here is a link to the settlement as incorporated into the court’s judgment. https://www.ftc.gov/system/files/documents/cases/160330cfaorder_reynolds.pdf
There are many lessons for all of us as individuals interested in making charitable donations. The first lesson is that merely because a charity’s name sounds legitimate does not make it so. Second, when you are considering making a donation to a charity, it is important to investigate the charity to find out whether it is an outright scam or whether it is one where very little of the money donated goes toward the announced charitable purposes of the charity. You can find the answers to both of those questions by going to http://www.charitynavigator.org, which, by the way rated these charities extremely low.