Hoaxes & Rumors

True or False: “Think Before You Donate” Charity Claims

waffles

November 24, 2014

Today we look at a graphic entitled “Think Before You Donate” which claims to compare the annual salaries of multiple charity executives.

Analysis of “Think Before You Donate” Graphic

A graphic called “Think Before You Donate” allegedly compares the earnings of several charities’ executives. It encourages readers to only donate to those with lower-paid administrators.

The first part of the claim presents five charities in a negative light. We’ll take a look at all of these claims first. To make it an even playing field among all the claims below, we’ll list executive compensation and program expense percentage for all charities below, even if they aren’t mentioned for a specific charity in the claims. Program expense is the amount spent on the cause for which they exist.

Note: The figures below are as of November 2014.

Charities Presented Negatively by the Graphic

American Red Cross

Graphic Claim: President and CEO Marsha J. Evans’ salary for the year was $651,957 plus expenses
Facts: Marsha J. Evans was CEO of the American Red Cross from 2002-2005. In December 2005 she received a severance package of $780,000. This included 18 months of salary plus $36,495 in an unpaid bonus. Based on this figure, this would work out to about $495,000 per year. The current CEO and President, Gail J. McGovern, actually earned more than claimed above, at $1,032,022 in 2009. Nonetheless, the Charity Navigator link below lists her compensation for 2013 at $564,864.
Program Expenses: 90.4%

March of Dimes

Graphic Claim: It is called March of Dimes because only a dime for every 1 dollar is given to the needy.
Facts: The National Foundation for Infantile Paralysis was founded in 1938 and was nicknamed the “March of Dimes” after fundraisers which requested that each child donate a dime (the name was officially changed years later). It should be noted that in 2012 President Jennifer Howse received a salary of $526,679.
Program Expenses: 66%–76%

The United Way

Graphic Claim: President Brian Gallagher receives a $375,000 base salary along with numerous expense benefits.
Facts: As of 2012, President and CEO Brian Gallagher actually made more than claimed, at $1,220,305.
Program Expenses: 90%–90.6%

Unicef

Graphic Claim: CEO Caryl M Stern receives $1,200,000 per year ($100k per month) plus all expenses including a Rolls Royce. Less than 5 cents of your donated dollar goes to the cause.
Facts: President and CEO Caryl M. Stern’s compensation is currently listed at $476,001 for 2013. There is no source or evidence to support the Rolls Royce claim.
Program Expenses: 90%–91.1%

Charities Presented Positively by the Graphic

The next set of charities are presented in the graphic in a positive light, shown in contrast to those listed above. It should be noted that some of these veterans organizations have fundraising foundations, which are not the same as the parent organization.

It should also be noted that, despite the claims below, none of the charities here give 100% of all donations to their causes.

The Salvation Army

Graphic Claim: Commissioner Todd Bassett receives a small salary of only $13,000 per year (plus housing) for managing this $2 billion dollar organization. 96 percent of donated dollars go to the cause.
Facts: A November 2011 BBB report showed that National Commander William A. Roberts actually received $126,920 in compensation.
Program Expenses: 84%

The American Legion

Graphic Claim: National Commander receives a $0.00 zero salary. Your donations go to help Veterans and their families and youth!
Facts: In 2009, the three officers listed on form 990 were compensated $201,611, $152,618, and $162,787.
Program Expenses: Did not disclose.

The Veterans of Foreign Wars

Graphic Claim: National Commander receives a $0.00 zero salary. Your donations go to help Veterans and their families and youth!
Facts: A 2010 report showed the top compensation for the VFW to be $238,211. The Veterans of Foreign Wars Foundation is the official charity for the VFW. The director of the Foundation is John G. Lowe, who is not compensated directly, but received $89,250 in compensation from affiliates in 2013.
Program Expenses: 86%

The Disabled American Veterans

Graphic Claim: National Commander receives a $0.00 zero salary. Your donations go to help Veterans and their families and youth!
Facts: The current National Commander of the Disabled American Veterans is Larry A. Polzin. Chairman of the DAV Charitable Service Trust is Richard E. Marbes. As of 2012, no compensation has been reported for leadership.
Program Expenses: 76%–93.5% (We are still looking into the reason for the discrepancy between figures as reported by give.org and charitynavigator.org)

The Military Order of Purple Hearts

Graphic Claim: National Commander receives a $0.00 zero salary. Your donations go to help Veterans and their families and youth!
Facts: According to 2009 financial statements, Former Executive Director Gregory A. Bresser received a $40,000 severance payment. CFO Stephen L. Ruckman received $150,626.
Program Expenses: Did not disclose.

The Vietnam Veterans Association

Graphic Claim: National Commander receives a $0.00 zero salary. Your donations go to help Veterans and their families and youth!
Facts: There is no known “Vietnam Veterans Association.” The Vietnam Veterans of America Foundation, AKA Veterans for America, paid President John Rowan $69,874 and CFO/Staff Director Joseph Sternburg $137,902 in 2009.
Program Expenses: Did not disclose.

Make a Wish

Graphic Claim: For children’s last wishes. 100% goes to funding trips or special wishes for a dying child.
Facts: In 2013, David A. Williams, CEO and President, was compensated $479,676 .
Program Expenses: 73.3%–81%

St. Jude’s Research Hospital

Graphic Claim: 100% goes towards funding and helping Children with Cancer who have no insurance and cannot afford to pay.
Facts: The 100% claim is not even supported by St. Jude, which stated on their on their website in 2013, “During the past five years, 81 cents of every dollar received has supported the research and treatment at St. Jude.” However, this quote no longer appears on the website when revisited in November of 2014. CEO William E. Evans received compensation of $824,000 according to a 2011 form 990. Charity Navigator reports that CEO William E. Evans was compensated $941,143 in 2013.
Program Expenses: 69.3%–73%

Ronald McDonald Houses

Graphic Claim: All monies go to running the houses for parents who have critical Children in the hospital. 100% goes to housing and feeding the families.
Facts: President and CEO J. C. Gonzalez-Mendez is not compensated.
Program Expenses: 79%–89%

Lions Club International

100% of donations go to help the blind buy hearing aides, support medical missions around the world. Their latest undertaking is measles vaccinations (only $1.00 per shot).
Facts: Executive Director Peter Lynch received no direct compensation, but did receive $226,049 in affiliate compensations for 2013. The organization does have a measles prevention campaign.
Program Expenses: 83.7%

“Think Before You Donate” on Google Trends

Google Trends shows a graph revealing search interests in “Think Before You Donate”. As one can see, searches for this phrase peaked in February of 2013 when this post was originally published, and surged again in November of 2013 before dropping off.

Bottom Line

The “Think Before You Donate” graphic claim attempts to categorize good and bad charities, however there aren’t as many differences between them as we are led to believe. Most charities have high-paid executives, and all the charities listed above incur expense costs that prevent them from using 100% of all monies collected toward their causes.

You should definitely research a charity before you donate, just as you should research online warnings such as these before you believe them.

Revised November 24, 2014
Originally published February 2013

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Hoaxes & Rumors

November 24, 2014

waffles @wafflesatnoon

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