Every day in Washington, D.C., many new coalitions, political action committees, and interest groups form. Many of them set up as charities or nonprofit organizations. Americans are very generous and vigorously support causes that help those in need. Donor resource Charity Navigator recently reported that Americans gave more than $373.25 billion to charitable organizations in 2015 alone.
As the U.S. celebrates National Military Appreciation Month this May, organizations dedicated to military and veterans’ causes are ramping up their appeals, raising money for worthwhile projects to benefit the heroes who bravely serve our country. Unfortunately, nefarious actors are simultaneously on the prowl, looking to take advantage of the American spirit of generosity and steal money intended for veterans and their families.
{mosads}While issues of abuses in charities are not limited to those focusing on the military, it is some of the most fertile ground to seed confusion and prey on the generosity and patriotism of others. Scammers who take advantage of the sense of pride and gratitude that comes from supporting military charities causing some donors to take on a “give at your own risk” attitude that jeopardizes legitimate operations.
Last week, financial records revealed that donations to the Wounded Warrior Project dropped more than $70 million in the second half of last year. While fully exonerated by forensic accountants, unfounded allegations at the charity last year (and the resulting shake of its leadership) caused a profoundly negative impact on the organization’s bottom line — in terms of reputation, fundraising, and impact.
One must ponder: had the perception of military charities been different at the outset of the perceived scandal, would confidence have been so quickly lost and difficult to earn back?
With the ample negative news about charity scams out there, there is no wonder that snap judgments are made without evidence.
In April, California Attorney General Xavier Becerra, acted quickly and filed civil lawsuits against the leaders of fake veteran charities that used hundreds of thousands of donations intended to help veterans for personal use, including shopping, paying off personal credit card debt, traveling, dining, and other luxuries. Becerra called this use of charity funds as a personal ATM as a “breach of the public trust” and described how these crimes are “worse when you do so at the expense of our veterans.”
Becerra’s actions are just one of the many illustrations of how things are getting tougher for the con artists out there. However, when combined with an existing skepticism, things are getting tougher for the legitimate organizations too.
Even a former member of Congress, Corrine Brown was convicted for stealing money from a fake charity.
Jason Lynch from the Charity Defense Council points out that scams (real or alleged) are headline generating, which gives the impression that they’re happening all the time. In reality, however, scams are rare and the clear majority of organizations are doing honest, important work.
Authorities are stepping up enforcement, Congress is getting more involved, and charity watchdogs are monitoring and reporting on nonprofits. Most importantly, honest charities are communicating more effectively than ever before and showing the benefits of their work.
While regulatory agencies and watchdogs are becoming more active, they must be careful not to stir up unnecessary outrage, such as in the Wounded Warrior Project situation. Lynch argues that “when the work of good charities is misconstrued, the charity suffers and those in need lose the most.”
“In the media’s push for clicks and ratings, we have seen good groups unfairly maligned by false and misleading claims. For example, overhead spending should not be conflated with fraud. Regulators and watchdogs should be asking about impact and results. The public deserves a more thoughtful approach to accountability than they’ve been given so far.”
Charities that make a big effort to illustrate their positive impact can blunt possible critics and mitigate risk. These proactive outreach efforts will simultaneously position their work apart from competitors, attract more donors, and ultimately create bigger social impact.
For example, Helping a Hero, which builds homes for wounded soldiers, has impressive credentials, high grades from watchdogs but, above all, a great story to tell. Meredith Iler, the chairman emeritus of the Houston-based organization, is a persistent advocate, sharing how the charity improves lives and communities.
“It helps our supporters to know that Helping a Hero is certified as a transparent charity by the Better Business Bureau, but what really makes a difference is when they see all of the homes we build,” Iler explained. “In the next 45 days, wounded warriors in Texas, North Carolina, Kentucky, and Oklahoma will have public welcome home ceremonies where their neighbors are invited to come see the homes and meet the veterans who have sacrificed so much for our freedom.”
No con artist can fake the events sponsored by Helping a Hero. They show existing donors and potential supporters exactly how their donations will be used and the real world benefits. In a culture of growing skepticism, charities must show donors tangible results.
Communicating benefits, progress, and success more than statistics or aspirations instills a sense of trust. Without that trust, even the most active and successful nonprofit will be met with skepticism and doubt.
Dan Rene is a senior vice president in the public affairs practice at the strategic communications firm, LEVICK.
The views expressed by contributors are their own and are not the views of The Hill.