Charity Goes from Zero to 60 (Million, That Is) in a Year

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November 16, 2011; Source: The StarWhen Charity Intelligence, a watchdog group in Canada, looked at the top hundred grossing charities for 2008, they found Help Eliminate disease and Addiction Canada or HEDAC, a group that had grown from proceeds of $0 in 2007 to $60.7 million a year later. Furthermore, HEDAC had accomplished this neat feat with no staff people whatever, according to financials eventually obtained from the Canada Revenue agency. “Something strange is happening there,” commented Greg Thompson of Charity Intelligence. “You’ve got big players bringing in a lot less than that with hundreds of staff.”

What may be occurring is a continuation of a scam that has been operating for years in Canada. A man listed as a co-director of HEDAC was asked about the funding surge and revealed that the money had flowed from the Relief Lending Group, formerly the Canadian Institute of International Philanthropy, which, according to this article, is a scheme that allows donors to minimize tax payments by giving to charity. I wrote about this operation here in 2010.

According to the article, Charity Intelligence found an even more dramatic situation at Malvern Rouge Valley Youth Services, which grew from “thousands one year to $120 million the next . . . [and] was stripped of its charitable status on Friday after auditors found that it participated in a $112 million donation scheme.”—Ruth McCambridge