On May 19, the Federal Trade Commission charged one organization with one of the largest acts of charity fraud in history. This organization split up into 4 separate "charities" so it could fly under the radar unnoticed for years. Since there are over 1 million charities registered in the U.S., it was easy. (The IRS approved over 94,000 new charities last year alone.) And the names of the 4 sham charities sounded very real: Cancer Fund of America, Cancer Support Services, the Children's Cancer Fund of America, and the Breast Cancer Society. Maybe you or someone you know gave to them.
This sham was run by James Reynolds Sr., his ex-wife, Rose Perkins, and his son, James Reynolds Jr. Nearly $200 million was raked in from donors who thought they gave to cancer research and/or patients. Less than 3% of the money actually went towards cancer causes! Some went towards running the sham, but the vast majority went to the three criminals and other key fraudsters. They bought fancy cars, houses... pretty much whatever they wanted, they got. They ate out in the best restaurants and went on grand vacations. They spent over $150 million in just a few years!
Experts agree that there are many worthy charities that are doing a lot of good, but they also warn that there are plenty of shams out there, ready to take your money. Many telemarketers can solicit donations on behalf of well-known charities and keep up to 85% for themselves legally! You have heard of the saying "buyer beware"... well now it's "donor beware"!