August 14, 2006

The imprudent charity.

Jim Lindgren finds a glaring question in the tax return of Black Box Voting.

8 comments:

SippicanCottage said...
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sparky said...

glaring? from what i gather they didn't put their cash in an interest bearing account. so i am puzzled at how exactly that would be glaring, unless you count failure to maximize as a sin. investigate? sure. but let's audit those churches campaigning for politicians first.

as an org, BBV is a bit too-conspiracy minded for me, but they have done some good work exposing software glitches in voting machines.

btw is it just me or does it seem like the whole Volokh site seems to have tilted significantly rightward lately?

Jonathan said...

Failure to maximize = throwing other people's money away. And in this case it's not even failure to maximize, it's failure to take the obvious and easy step of specifying an interest-bearing account for the organization's assets. $600k invested at 4% returns a couple of grand a month. What this organization appears to have done is no different than if the staff had spent $2k each month on dog grooming services or other frivolous purposes.

Kathy said...

In my experience, it's almost impossible to find a charity whose books will stand close inspection, or any.

That's a little extreme. Many charities, at least the ones I give to, belong to standards organizations that set guidelines and audit the member organizations. Reputable charities make their audits public. You do have to be careful, but that doesn't mean there aren't any good one.

sparky said...

jonathan--
don't think i agree with your characterization. i am not defending what they [apparently] did. but not earning interest is not the same thing as spending money on dog grooming. a non-act is not the same thing as an act.

sparky said...

to clarify: the headline was well-chosen--i think "imprudent" in the sense of ill-advised is a good term for this kind of goof. whether it is or should be actionable is another question, and i am happy to say i have no knowledge on that point.

SippicanCottage said...
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Kathy said...

Sippican-

Oh, I certainly agree about this charity and many other silly ones out there. Why people give to them without checking them out is beyond me. But I take exception to the characterization that there are almost no worthwhile charities in existence. I give to 5 or 6 every month that I *know* get the money where it's supposed to go, and I like where it's going. That was the only point of my comment. I certainly wasn't defending this charity!

I think these charities get by because people *don't* do their research before donating. And lots of people seem to give money to "charities" that are just political orgs in disguise. I don't know why. . .