Athletes’ Charities Often Lack Standards - US Report

A US investigation by Sports Network ESPN’s "Outside the Lines" reveals that most of the charities founded by high-profile, top-earning male and female athletes don't measure up to what charity experts would say is an efficient, effective use of money.

Using guidelines set by Not for Profit watchdogs Charity Navigator, the Better Business Bureau and the National Committee for Responsive Philanthropy, "Outside the Lines" found that 74 percent of the 115 Not for Profits it investigated fell short of one or more acceptable NFP operating standards.

The “Outside the Lines” report says the standards cover all sorts of aspects, such as how much money a Not for Profit actually spends on charitable work as opposed to administrative expenses and whether there are enough board members overseeing the organization.

Among the "Outside the Lines" findings:

• Many athlete charities fail the effectiveness test for a variety of reasons, ranging from the deceptive and unethical — if not illegal — to the simply neglectful and ignorant. Some athletes set up foundations as tax-planning vehicles. Others dispute the Not for Profit standards overall, saying as long as they spend at least some money on actual charity they should not be criticized.
• In many cases, OTL had a hard time measuring a charity's actual effectiveness because it was behind on filing its IRS tax returns or the returns were filled with errors and omissions.
• Even though the athlete charities often are named in honor of wealthy sports icons, only about a third of them had total assets of $500,000 or more. Multimillion-dollar charities that actually run programs, such as those founded by Tiger Woods, Lance Armstrong, Andre Agassi and Richard and Kyle Petty, are rare.

An example of what "Outside the Lines" found after conducting interviews and examining documents included a charity that promised money for cancer research that has not given a dime in grant money to any cancer entity in its eight-year history.

“The implications of poorly run charities are large,” Ken Berger, the President of Charity Navigator, a firm that monitors and grades charities said.

"It's critical that when these kind of opportunities are available that the celebrities involved realize the profound responsibility that they have to try to get as much money to support these worthy causes as they can and to make sure they don't damage the public trust," he said.

While he said the percentage "Outside the Lines" found as problematic is in line with what Charity Navigator sees among all charities, athletes and other celebrities – with their resources and name recognition -should be held to a higher standard because they have the ability to do better.

"They can have a tremendous positive influence rather than doing so-so or average, rather than like everybody else," Berger said.

The full ESPN story can be found here.