Four charities that purported to raise funds for cancer research or cancer patients have been charged with misusing many of the millions they received in donations. Two of the charities are fighting the charges, but the other two are shutting their doors. This is one of the largest charity fraud cases in history.
The charges were brought by the U.S. Federal Trade Commission (FTC), and the attorneys general of all 50 states and the District of Columbia. The charities are Cancer Fund of America, Cancer Support Services Inc., the Children's Cancer Fund of America, and the Breast Cancer Society Inc. All four charities were created and controlled by the same group of individuals, led by James Reynolds, Sr., according to the FTC. The charities received $187 million in donations.
The two charities that have agreed to be dissolved are the Children's Cancer Fund of America and Breast Cancer Society Inc. Both the Cancer Fund of America and Cancer Support Services are choosing to fight the charges in court.
According to the Center for Investigative Reporting, Cancer Fund of America ranks as No. 2 on its America's Worst Charities list. The group raised $86.8 million for charity, but just 1% of that reached cancer patients. The ninth charity on the list was the Children's Cancer Fund of America.
These groups raised money from telemarketing calls and direct mail. In some cases, they hired professional fundraisers who would keep the vast majority of the funds that were collected, according to the FTC.
Some of the money raised was used for trips to vacation destinations such as Las Vegas, New York, and Disney World. Other purchases included cars, cruises, and gym memberships. The organizations would then inflate their revenue to hide the misused donations.
The FTC said it had proposed judgments of $65 million against the Breast Cancer Society and $30 million against the Children's Cancer Fund of America, which is what they collected from 2008 to 2012.
