In a lawsuit filed today by The Federal Trade Commission, four cancer charities are accused of using $187 million to buy jet skis, cars, and cruises for friends and relatives — instead of spending that money on the cancer patients they'd vowed to help, the AP reports. It might be the biggest case of its kind in U.S history, and by far the most depressing story we've read all day.
Defendants in the case are The Breast Cancer Society, Cancer Fund of America, its affiliate Cancer Support Services, and Children's Cancer Fund of America — along with three members of the family that ran the charities, James T. Reynolds Sr., his son, and his ex-wife.
The FTC, joined by all 50 states and D.C., alleges that the elder Reynolds used his position to hire family members to the various organizations at six-figure salaries. The three are also accused of using money meant for cancer patients to purchase gym and dating-site memberships, cars, and college tuition for friends and family.
Different chapters of the charity, "operated as personal fiefdoms characterized by rampant nepotism, flagrant conflicts of interest, and excessive insider compensation," according to the complaint.
Both Reynolds' and Rose Perkins (Reynolds Sr.'s ex-wife) will be banned from future charity work, per a settlement agreement. The agreement also calls for the dissolution of Children’s Cancer Fund of America and Breast Cancer Society, with each organization poised to pay $30.1 million and $65.5 million, respectively. Cancer Support Services owes $41.2 million.
That money was raised between 2008 and 2012, mostly through telemarketers. Donors were told their money would go directly to aid cancer patients’ treatments, including transportation to facilities, hospice care, and pain medication. Patients never saw much — if any — money from these efforts. "The money is mostly gone,” director of the FTC Bureau of Consumer Protection Jessica Rich said in a press release. “I’m pleased that the FTC and our state partners are acting to end this appalling scheme.”
It's unlikely that much of the $187 million will be recouped, since it's largely been spent.