What is perhaps the most important take away from the recent breakup of the Reynolds family scam nonprofit ring?

Vetting organizations before donating.

The Tennessee-based ring of cancer nonprofits swindled donors of $187 million, spending as little as 3 percent on the cancer patients purportedly assisted through the groups’ services. With sizable executive salaries for friends and families and the steep cost of third-party fundraising contractors taking up to $0.85 for each fundraising dollar, the rings’ actual services were superficial at best.

The organizations in the network, however, had atrocious ratings long before they were shut down. The recent lawsuit alleging illegal and deceitful practices was simply the final straw that led to their dissolution. The use of high-fee solicitors is legal, and is practiced across the nonprofit world, essentially diluting charitable dollars.

This point may seem like 20-20 hindsight for the those whose generosity was abused by the Reynolds family and their associates, but being aware of nonprofit ratings in the future can be invaluable for making sure charitable gifts make the greatest possible impact.

There are multiple rating services that provide insight into how well nonprofits pursue their mission and how transparently they manage their finances.  Charity Navigator is easy to use and generates starred ratings for nonprofits that provide a sense of security for the giving public.

This memorial day, as the nation prepares to honor veterans, taking some time to look up and index several legitimate nonprofits will go a long way toward making sure that your charitable gift will make a real difference in veterans’ lives

Be sure to avoid groups mentioned on the worst charities list – a jointly compiled rundown by the Tampa Bay Times and Center for Investigative Reporting. A number of veterans groups are featured, including some that employ third-party solicitors that take up to 90 percent of a funds raised.

The following organizations are highly rated, and promise a positive return on your gift this Memorial Day:

DAV (Disabled American Veterans) Charitable Service Trust

Iraq and Afghanistan Veterans of America

Operation Support Our Troops – America

Thanks USA

Wounded Warriors Family Support


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