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Wed Oct 29, 2014, 02:44 PM

Crossing Off the Red Cross --Stunning Report Shows Millions Wasted in Hurricane Sandy Aid

Crossing Off the Red Cross
17 Oct 29, 2014 8:27 AM EDT
By Barry Ritholtz

The American Red Cross has become a man-made disaster. It wasted millions of dollars in Hurricane Sandy aid through mismanagement and poor judgment. It compounded the problem by covering up its errors, hiring lawyers to prevent the public from finding out what happened to its donations.

Earlier this year, I expressed my disappointment in the Red Cross. It had raised $312 million for storm relief, but then stonewalled on how the money was spent.


This morning, we found out why. Thanks to the dogged investigation by Justin Elliott and Jesse Eisinger of ProPublica and Laura Sullivan of NPR, we learned how poorly the Red Cross responded to the Sandy disaster.

Their article "The Red Cross’ Secret Disaster" is must reading for anyone who contributes to philanthropies.

The details of how it botched the relief efforts are laid out in Red Cross documents and are simply stunning:



• Despite plenty of advance warning of Sandy, the Red Cross lacked basics such as food, blankets and batteries to distribute to victims after the storm.

• Red Cross workers weren't provided with the usual GPS devices. Many got lost driving around the New York area and were unable to deliver aid and supplies.

• As many as half of the emergency meals prepared for Sandy victims were wasted or never delivered.

• The Red Cross failed to deliver food, water, shelter, cleaning supplies, blankets to survivors of Sandy until weeks after the storm. Mormon and Amish volunteers, on the other hand, were delivering supplies just three days after the storm.

• Red Cross supervisors ordered dozens of empty trucks to be driven around, “just to be seen,” in lieu of delivering relief supplies.

• Emergency response vehicles and other assets were also diverted from disaster aid to be seen as backdrops at news conferences for PR purposes; the Red Cross did this after other storms too, including Hurricane Isaac.


Perhaps most damning is evidence that the Red Cross fabricated claims of how many people were actually served by the charity. The Red Cross said that “17 million meals and snacks were delivered, there were 74,000 overnight stays in shelters, more than 7 million relief items like blankets and flashlights.” Internal documents cast doubt on those numbers, saying the charity’s ability to actually count what was delivered was “crippled.”

[bThe Red Cross takes in more than $1 billion a year in donations, but seems to have lost the ability to manage that money.

http://www.bloombergview.com/articles/2014-10-29/crossing-off-the-red-cross
----------------------------------

ProPublica Documents: TRULY DISGUSTING READ....
http://s3.amazonaws.com/propublica/redcross/the-red-cross-secret-disaster.html

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Reply Crossing Off the Red Cross --Stunning Report Shows Millions Wasted in Hurricane Sandy Aid (Original post)
KoKo Oct 2014 OP
get the red out Oct 2014 #1
hlthe2b Oct 2014 #2
KoKo Oct 2014 #4
KoKo Oct 2014 #20
Warpy Oct 2014 #3
KoKo Oct 2014 #6
Warpy Oct 2014 #7
KamaAina Oct 2014 #5
yellowwoodII Oct 2014 #8
KoKo Oct 2014 #18
joeybee12 Oct 2014 #9
KoKo Oct 2014 #11
joeybee12 Oct 2014 #16
LawDeeDah Oct 2014 #10
KoKo Oct 2014 #12
Blue_Tires Oct 2014 #13
adirondacker Oct 2014 #14
Major Hogwash Oct 2014 #15
KoKo Oct 2014 #19
kelliekat44 Oct 2014 #17

Response to KoKo (Original post)

Wed Oct 29, 2014, 02:50 PM

1. This is terrible

So many people could be helped with waste like this. My husband has had his suspicions about the Red Cross since he volunteered with the local Red Cross many years ago. Consequently, we have usually sought out other charities for our contributions (not that we can ever give enough).

I really never imagined this though

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Response to KoKo (Original post)

Wed Oct 29, 2014, 02:56 PM

2. One would have thought after the Katrina debacle...

sigh...

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Response to hlthe2b (Reply #2)

Wed Oct 29, 2014, 03:22 PM

4. They appointed a new head after Katrina.. Here's her Background...(AT&T Executive)

(One wonders if she was just a bad match for a Disaster Relief Charity)

The modern-day Red Cross was created by congressional charter more than a century ago and plays a unique part in responding to disasters. The iconic charity has a government mandate to work alongside the Federal Emergency Management Agency in relief efforts.

The Red Cross has endured patches of trouble in the recent past. It faced allegations of financial mismanagement after Sept. 11 and Hurricane Katrina and a series of chief executives were forced to resign. Congress forced an overhaul. The Red Cross recruited McGovern to the top job in 2008.

McGovern had spent her career as an executive at AT&T and Fidelity and was teaching marketing at Harvard Business School. “This is a brand to die for,” she said in an early interview as the Red Cross’ chief executive.

Indeed, the Red Cross remains a magnet for wealthy and corporate contributors, drawing more than $1 billion in donations last year, including at least $1 million each from Lady Gaga, Nicolas Cage and the oilman T. Boone Pickens.

When McGovern took the reins, she inherited a sprawling operation with hundreds of chapters across the country. The Red Cross has more than 26,000 employees. After a storm, the full-time staff mobilizes volunteers and a smaller corps of disaster relief experts, known as reservists.

While often praised as a stabilizing presence by those outside the Red Cross, McGovern initiated a series of changes inside the organization that roiled the venerable charity. She executed layoffs and reorganizations that closed local chapters and centralized power at national headquarters in Washington. In part, these changes reflected several years of operating in the red. In its most recent year, the Red Cross ran a $70 million budget deficit. “Fundraising fell short of our target in a year without any huge national disasters,” McGovern wrote in a September email to executives.

More at:
ProPublica Documents: TRULY DISGUSTING READ...

. http://s3.amazonaws.com/propublica/redcross/the-red-cross-secret-disaster.html

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Response to KoKo (Reply #4)


Response to KoKo (Original post)

Wed Oct 29, 2014, 03:15 PM

3. OWS did a much better job

and they're not even a relief organization.

The NRC needs to funnel money to the local Red Cross instead of sending a bunch of wonks with their heads up their butts in to a disaster area. The local group knows the geography, knows the people, and knows where the disaster area is.

I shudder to think of a disaster in Boston with a bunch of out of towners trying to coordinate relief efforts. If they can't find their way around NYC--which was actually planned--they don't have a chance in Boston, which was laid out by cows and drunken sailors.

These days, I make loans at Kiva, donate to the Roadrunner Food Bank (purely local), and have Doctors Without Borders listed as "transfer on death" on the portfolio my dad left me. I'm also a soft touch for homeless folks looking for a day's work.

Too many organizations have been disappointments.

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Response to Warpy (Reply #3)

Wed Oct 29, 2014, 03:31 PM

6. Here's a bit of what the New Director after Katrina did to change the operation...

She's a former AT&T Executive and Marketing Professor at Harvard. So..maybe the changes she made weren't helpful. After Katrina, though one wonders why didn't they seek someone with some Relief Agency background?
-------

This is from the ProPublica Info:
When McGovern took the reins, she inherited a sprawling operation with hundreds of chapters across the country. The Red Cross has more than 26,000 employees. After a storm, the full-time staff mobilizes volunteers and a smaller corps of disaster relief experts, known as reservists.

While often praised as a stabilizing presence by those outside the Red Cross, McGovern initiated a series of changes inside the organization that roiled the venerable charity. She executed layoffs and reorganizations that closed local chapters and centralized power at national headquarters in Washington. In part, these changes reflected several years of operating in the red. In its most recent year, the Red Cross ran a $70 million budget deficit. “Fundraising fell short of our target in a year without any huge national disasters,” McGovern wrote in a September email to executives.

More at:
ProPublica Documents: TRULY DISGUSTING READ...

. http://s3.amazonaws.com/propublica/redcross/the-red-cross-secret-disaster.html


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Response to KoKo (Reply #6)

Wed Oct 29, 2014, 03:42 PM

7. UGH. Business people can't run health care and can't run charities

and there is no reason to put anyone but public health people in charge of these things.

All business people know how to do is "streamline" by firing as many people as possible and both these areas are labor intensive. It just never works and when people learn about them, the health care organizations lose business and the charities lose donations.

The National Red Cross has suffered from years of incompetent people heading it, from Liddy Dole on forward to McGovern.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 03:26 PM

5. Crossed 'em off years ago

 

a friend in NOLA once told me that after Hurricane Betsy in the '60s, they sold bread.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 05:21 PM

8. Charity Organization CEO's Paid Too Much in General--

http://www.charitywatch.org/hottopics/Top25.html
Money hungry people have learned to play on peoples' emotions.

Abraham H. Foxman, National Director Anti-Defamation League & Foundation
$3,802,324

Includes $3,146,670 supplemental executive retirement plan.
Edwin Feulner, Jr., Past President Heritage Foundation
$2,702,687

Includes investment earnings of $1,656,230 accrued over a period of 33 years.
Philip H. Gutin, M.D., Chairman Attending Surgery, Neurosurgery Memorial Sloan-Kettering Cancer Center
$2,645,233

Robert J. Mazzuca, Past Chief Scout Executive Boy Scouts of America - N.O.
$1,921,979 Includes 457(f) supplemental retirement plan of $655,542.

Michael Aiona, M.D., Chief of Staff

Shriners Hospitals for Children
$1,758,081

Includes $1,300,531 retirement and other deferred compensation.

Michael Friedman, M.D., CEO/Past President

City of Hope

$1,689,543


Edward J. Benz, Jr., M.D., President/CEO Dana-Farber Cancer Institute/Jimmy Fund
$1,420,202

Enrique Ferraro, Managing Director, Accion Investments Management Company Accion International
$1,233,192

Includes $1,041,107 incentive compensation, of which most was awarded by Accion International Management Company for ten years of fund management.
Rabbi Yechiel Eckstein, President/CEO International Fellowship of Christians and Jews
$1,203,690

Includes $602,397 supplemental non-qualified retirement plan.
Nancy Brown, CEO American Heart Association
$1,097,203

Brian Gallagher, President/CEO United Way Worldwide
$1,026,017

Jonathan W. Simons, M.D., President/CEO Prostate Cancer Foundation
$1,012,143

Steven E. Sanderson, Past President/CEO Wildlife Conservation Society
$1,007,809

Michael L. Lomax, President/CEO UNCF/The College Fund
$998,735

Harry Johns, President/CEO Alzheimer's Association - N.O.
$980,804

Includes $211,509 vested non-qualified retirement benefit.
William E. Evans, Director/CEO St. Jude Children's Research Hospital/ALSAC
$977,444

Wayne LaPierre, CEO & Executive VP/Ex-Officio National Rifle Association & Foundation, respectively
$974,867

William R. Brody, M.D., President Salk Institute for Biological Studies
$971,543

Larry R. Blum, Past COO Hadassah
$954,861

Includes $731,356 two years' severance pay.
Robert J. Beall, President/CEO Cystic Fibrosis Foundation
$916,100

Scott A. Blackmun, CEO United States Olympic Committee
$885,131

David Harris, Executive Director American Jewish Committee
$859,333

James E. Williams, Jr., President/CEO Easter Seals - N.O.
$837,120

John R. Seffrin, CEO American Cancer Society
$832,355

Rabbi Marvin Hier, President/CEO Simon Wiesenthal Center
$804,770


* Includes "Compensation," "Contributions to employee benefit plans," "Expense accounts and other allowances," and deferred compensation earned in reporting year, as reported

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Response to yellowwoodII (Reply #8)

Wed Oct 29, 2014, 09:26 PM

18. That's a real Eye Opener.....those salaries. Seems way much for Charity Organizations

to pay for CEO's or Directors.

But, then...it's way below what our Bankers and Corporate CEO's earn these days even after the Huge Crash in 2008 that we folks out here are still paying the costs of with the Austerity Programs.

I guess they think they are worth it....if they get "Their Cut" on the backs of the Disaster Survivors.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 05:28 PM

9. Lizzie Dole ruined the Red Cross and it has never recoevered...nt

 

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Response to joeybee12 (Reply #9)

Wed Oct 29, 2014, 07:11 PM

11. Yes...folks should do a "Wiki" or "Duck Search" on Liddy Dole's Tenure at Red Cross.....

There's a History There of Raking in the Money for Disasters.....and nothing much is done but to "line folks pockets with ill gotten gains" on the Backs of National disasters.

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Response to KoKo (Reply #11)

Wed Oct 29, 2014, 07:59 PM

16. And using those resources to prepare for her presidential run...

 

Disgusting human being that the media looked the other way for.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 05:33 PM

10. Damned thieves are everywhere. fucking vermin.

 

This makes me blow my top. Someone got a hold of that money and it wasn't the fault of the worker on site. I hope the financials get scoured and some big shot execs get the boot and criminal charges.

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Response to LawDeeDah (Reply #10)

Wed Oct 29, 2014, 07:19 PM

12. Search out "Other Groups" who are "On the Ground" to give your support.

People here trash many groups ....but if you go to "Hurricane Sandy, NJ. Charity Groups" you might find a place to donate a "few bucks" (tax deductable) to an organization that might be STILL working with people in dire need after Hurricane Sandy.

My father was a WWII Vet...and he said..."Red Cross NEVER did anything for us Soldiers...it was the Salvation Army who helped us.

But DU'ers HATE THE SALVATION ARMY.......(for some religious reason) but my Father Said...they were the "First on Scene with Aid."

I was always wary of the Red Cross after his impression. Seems he was Correct.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 07:20 PM

13. kick for truth

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Response to KoKo (Original post)

Wed Oct 29, 2014, 07:33 PM

14. NPR did a story today "Red Cross 'Diverted Assets' During Storms' Aftermath To Focus On Image"

"Within hours of Superstorm Sandy slamming the East Coast two years ago, Americans opened their wallets to help — donating millions to the first charity that came to mind: the American Red Cross.

President Obama, like most elected officials and celebrities, vouched for the organization, encouraging people to give.

In the months after the disaster, the Red Cross touted its success in delivering food, clothes and shelter to tens of thousands of people left homeless by the storm. Gail McGovern, the Red Cross president and CEO, told NBC News two weeks after the storm: "I think that we are near flawless so far in this operation."

The truth, however, is different.

The venerable charity's track record in dealing with the megastorm is now being challenged by an unusual cadre of critics — its own employees and records."

More....
http://www.npr.org/2014/10/29/359365276/on-superstorm-sandy-anniversary-red-cross-under-scrutiny

Liz Dole's Red Cro$$

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Response to KoKo (Original post)

Wed Oct 29, 2014, 07:50 PM

15. NPR is controlled by a rightwinger. I threw them into the dumpster years ago.

I am surprised that they took any time away from the other stories they have been reporting on, ISIS and Ebola.

I watched about a half of an hour of NPR's bs yesterday and they had a story by Judy Woodruff, a known Republican hack, touting the rise of ISIS as the worst thing to happen since WWII, sandwiched between 2 Ebola stories.

Fear is the only thing they were selling, so I turned it off.

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Response to Major Hogwash (Reply #15)

Wed Oct 29, 2014, 09:30 PM

19. It was "ProPublica" in coordination with NPR...

NPR probably wanted to revive part of it's former "reputation" ...but, so far as we know, ProPublica isn't in league with "The Devil."

There were huge amount of complaints about the Red Cross during the Hurricane Sandy Aftermath....so much so that OWS had to step in to help the people.

So, this report verifies that something went wrong with the Red Cross.

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Response to KoKo (Original post)

Wed Oct 29, 2014, 08:05 PM

17. I wonder who really controls the RC and where the money went? nt

 

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