Donate

Local Nonprofits on List of Organizations Hit by Theft, Fraud

| October 28, 2013
  • Share:
  • Facebook
  • Pinterest
  • Reddit
  • Email
Fort Mason Center in San Francisco (Simon Collison / Flickr)

Fort Mason Center in San Francisco. In 2009, according to its federal Form 990 filing, the center “discovered that a long-time employee had diverted funds from the organization over a period of years for his personal use, in the amount of $677,596.” (Simon Collison / Flickr)

Correction: At the end of the original post, we ran the Washington Post’s list of local nonprofits reporting misappropriation of funds to the IRS. The Northern California Chapter of the U.S. Green Building Council appeared on the list. The group says it had no misappropriation of funds, and it did not report a misappropriation of funds. It reported the theft of some checks, but it says no money was lost. Its name has been removed from our list below.

Original post: An Oct. 26 investigation in the Washington Post on theft, fraud and embezzlement at nonprofits revealed huge losses by big and small nonprofits alike, across a range of services and missions. It also turned up nearly 50 local nonprofits that reported misappropriated funds, including Marin General Hospital, the Tides Foundation, Fort Mason Center and San Francisco Ballet. (See full list below.)

The diversions drained hundreds of millions of dollars from institutions that are underwritten by public donations and government funds.

Since 2008, nonprofits have been required to report on federal Form 990 a “significant diversion” of assets totaling more than $250,000. The Post identified more than 1,000 nonprofits that reported diversions from 2008-2012, and while some involve legal exchanges, most are due to theft or embezzlement. Nonprofits are told to explain what happened on the form, but according to the Post, many provided few or no details, and many of these diversions have not been reported by the news media.

The amount of money involved is enormous. Said the Post:

The diversions drained hundreds of millions of dollars from institutions that are underwritten by public donations and government funds. Just 10 of the largest disclosures identified by The Post cited combined losses to nonprofit groups and their affiliates that potentially totaled more than a half-billion dollars.

The Tides Foundation, which makes grants to nonprofits working toward social change in the U.S. and abroad, explained what happened in March 2008 in its filing:

… Tides Foundation discovered that a long-time employee had diverted funds from Tides for personal use – approximately $45,000 per year for three years. This was accomplished through falsified documentation including falsified e-mails, invoices and progress reports from non-existent projects.

Marin General Hospital described in its filing how it fell victim in 2010:

…  the Board of Directors of Marin General Hospital determined that the prior member of the organization, through its representatives, violated its fiduciary duty to Marin General Hospital by using its position of control to inappropriately divert assets totaling in excess of $100 million to its own accounts without the formal consent of the organization and without adequate consideration.

Joe Stephens, co-author of the Post story, was interviewed on “PBS News Hour” and talked about the Post’s database of nonprofits that reported diversions. He said that just because a nonprofit has been victimized “doesn’t mean it’s a bad organization or they did anything wrong. But the experts say this should be a sign to donors, to supporters, to volunteers, if you see this on the form, go your group and say what happened, give us details and what have you done to make sure there is not a reoccurrence?”

The San Francisco Business Times went through the Post’s database and published this list of Bay Area nonprofits that reported misappropriated funds since 2008:

  • Fort Mason Center, San Francisco
  • Equal Access International, San Francisco
  • W Haywood Burns Institute, San Francisco
  • Acro-Sports Gymnastics and Sports Acrobatics Center, San Francisco
  • Plan of Action for Challenging Times, San Francisco
  • Youth Tennis Advantage, San Francisco
  • BlueEnergy, San Francisco
  • Psychoanalytic Institute of Northern California, San Francisco
  • Tides Foundation, San Francisco
  • San Francisco Ballet Association, San Francisco
  • Equal Access International, San Francisco
  • Chinese American Citizens Alliance, San Francisco
  • The North Beach Chamber of Commerce, San Francisco
  • American Musical Theater, San Jose
  • National Popular Vote, Lafayette
  • Positive Coaching Alliance, Mountain View
  • Great Valley Academy, Modesto
  • Laborers International Union of North America, Pleasanton
  • Housing for Independent People, Milpitas
  • Stride Center, Oakland
  • Deaf Counseling Advocacy & Referral Agency, San Leandro
  • Seacology, Berkeley
  • Pacific Boychoir Academy, Oakland
  • San Ramon Soccer Club, San Ramon
  • Asian Pacific Environmental Network, Oakland
  • Helios New School, Palo Alto
  • Discovery Counseling Center of the San Ramon Valley Inc., San Ramon
  • Common Counsel Foundation, Oakland
  • Partners for Adoption, Walnut Creek
  • Carr Educational Foundation, San Rafael
  • Richmond Art Center, Richmond
  • Peninsula Symphony of Northern California, Los Altos
  • Machine Intelligence Research Institute, Berkeley
  • Greenmeadow Community Association Inc., Palo Alto
  • University of Sciences and Technology of China Alumni Foundation, San Jose
  • Small World Christian School, Modesto
  • Alameda Education Foundation, Alameda
  • American Association of Russian Business Professionals AMBAR Inc, Palo Alto
  • SEIU UHW Local, Oakland
  • Amalgamated Transit Union, Fresno
  • Concerned Neighbors Against Illegal Billboards, San Rafael
  • Golden State Warriors Foundation, Oakland
  • California Congress of Parents Teachers & Students, Mill Valley
Related

Explore: ,

Category: Law and Justice, News

  • Share:
  • Facebook
  • Pinterest
  • Reddit
  • Email
  • YoloanR

    I too discovered major fraud dealing with a non-profit known as CaliforniaALL.

    Some of the finding were published by The Leslie Brodie Report.

    See:

    http://lesliebrodie.blog.co.uk/