Monday, June 06, 2011

Doomsday Has Been Rescheduled, But What About The Donations Raised for It?

We all now know that Harold Camping, leader of Family Radio, the doomsday prophecy group that predicted that on May 21, 2011 the wold would end, got that date wrong.  Here we still all are.  Camping has since stated that he made and error.  The prophecy is extended through October 21.

According to CNN Money's article (found on Yahoo Finance's June 1), Doomsday believer donates entire inheritance to Family Radio, Doris Schmitt, an elderly American lady, left in her will $25,000 to Family Radio.  Eileen Heuwetter, the executrix of the will, who is also Schmitt's niece, was saddened to hear of the large sum of her aunt's money going to the group.  As her aunt's estate is now closing, Heuwetter was so upset that she contacted several lawyers to see what could be done, if anything, to recover the sum of money.  To quote the article, "...they brought the case to several lawyers, who sympathized with the family, but agreed they had no case. Family Radio did not respond to [CNN Money's]  requests for comment."

In a timely fashion, Rick Cohen, for The Nonprofit Quarterly, on May 23 wrote, Nonprofit Raises Big Bucks For Doomsday - What Now? and he prompts us to consider what the recent increase in fundraising capabilities of doomsday groups has to do with charity.  He wonders if asking for donations and not delivering on the rapture is ripping people off.  It is a fair question, I argue, and I think that Doris Schmitt would, too. 

In CNN Money's article it states, "While other family members insisted it was crazy to let her aunt give all that money to a radio station, Heuwetter didn't initially contest the conditions of the will. She knew little about the Christian radio station, but knew her aunt, Doris Schmitt, found comfort in it."

According to American law, once a donor gives a donation and it is accepted by the nonprofit recipient of that donation it is a legal and binding charity-related fiscal transaction.  In other words, it was Schmitt's money to give to whomever or whatever she wished to bequeath her money to.  Is this sad?  It is if you consider, as her niece does, that relatives who are currently in financial need, or other nonprofit organizations that perhaps deliver programs and services (and deliver them well, ethically, and provide something that is needed but not gotten elsewhere) would have used the money for better ends.  But, again, it was her aunt's decision to make, as the $25,000 was her aunt's money.

I am not saying that her aunt couldn't have perhaps learned about philanthropy and how to leave an estate or bequest that winds up effectively, efficiently, but also ethically delivering something to the community at large, along the donor's values, interests, and wishes, but that also enables a nonprofit to do something (for someone or something in need).  I'm also not saying that her aunt couldn't have gotten council from trusted friends and family on who would be a good recipient of her estate, given Schmitt's values, dreams, and wants for the community at large.  But, having said this, I don't know that these weren't Schmitt's experience.  The fact is, she may have done each of these proactive and self-informing steps and still chosen to give $25,000 to Family Radio.

Cohen, in The Nonprofit Quarterly article, does ask whether (as is required by law) did Family Radio (as it expected the end of the world was nigh on May 21) spend down all of its assets.  This is a more interesting question for those of us who give donations to nonprofits, but also for those of us who work with nonprofits.  Why?  The question is in step with contemporary, American, nonprofit, best practices which happen to be backed, now, by federal law.  Charities can have their nonprofit status revoked by the IRS (thus no longer making it legal for them to raise donations as a charity) if certain fiscal and operational reporting requirements are not met or not met in full disclosure.  Between you and I, I'm guessing there is a certain three letter federal agency that is looking into Family Radio, its reporting in recent years, and its charity status.  But, this is just a guess.  You see, it is not enough to simply create a nonprofit, create a cause (such as the rapture), and then go fundraising for charity donations.  A legal nonprofit, in the United States, (one that is recognized by all of the governments that require it to report to them, including the federal government) a charity must do, report, and disclose certain specific accomplishments, receipts, processes, and bookkeeping each year.  If it doesn't add up -there is a further (deeper) investigation which, depending on findings, can result in a nonprofit losing its official charity status.

As stated again and again in this blog, if an organization is legitimately operating in order to achieve successes in the community at whatever work is involved in its mission statement, it is not enough to start the nonprofit and begin fundraising and expect that just by virtue of the organization being a charity (which most people presume is doing "good" (whatever that is)) the nonprofit will raise enough money in order for the organization to do whatever it is that the charity is doing.  The fact is, a nonprofit has to not just work in a cause or issue (i.e. the rapture) that people care about - in order for a nonprofit to have longevity enough to grow and achieve successes - it must demonstrate that it's providing a real solution to a real , but as yet, unmet need in the community - and meet that need ethically, professionally, efficiently, and effectively, over and over again (even as the need changes into a new one).  Donors are like investors and as such, they give repeatedly to the same organization only when they see that their investment (or donation) was spent as expected, provided some real and needed result, and that they have the potential to do similarly again.

Update 10/21/2011: Radio prophet gone from airwaves on new Judgement Day eve

2 comments:

CDSGlobalNP said...

Interesting topic. Is it really ripping someone off if this is the cause they freely choose to give to?

The fact is that donations to nonprofits are just that…donations. They are gifts that are given… and not in order to receive anything in return.

One of our bloggers, Brett Ridge shared his thoughts on this topic here: http://www.cdsglobalnp.com/fundraising/be-careful-precedent-in-suing-camping-is-dangerous/

Arlene M. Spencer said...

CDSGlobalNP,
I think if you read my post you'll see that actually, I say that its the donor's prerogative to give as he or she sees fit.

If you look it over one more time, you'll see that what I actually am considering, in this post, is the legality of the operations of a federally recognized charity (and by virtue of it being such, gets the benefit of raising tax free dollars). Arlene