Senator Asks Red Cross To Explain Its Finances | KERA News

Senator Asks Red Cross To Explain Its Finances

Jan 9, 2015
Originally published on January 9, 2015 2:38 pm

Sen. Charles Grassley, R-Iowa, is asking the American Red Cross to explain inaccuracies in how it has said it uses public donations, citing questions raised by an NPR and ProPublica investigation.

Grassley called into question how much of the charity's donations actually go to disaster services.

The Red Cross, and specifically CEO Gail McGovern, have repeatedly said, "91 cents of every dollar that's donated goes to our services," according to McGovern's speeches and the Red Cross' website. But a recent investigation by NPR and ProPublica found that number is incorrect.

According to the charity's tax documents, the Red Cross has spent as much as 26 percent of what people donate on fundraising. That doesn't even include management or overhead costs. That means the number could be in the 70s, or even lower.

The Red Cross has declined to provide the actual number or a breakdown of its expenses.

Grassley is asking the organization to provide those numbers, as first reported by the Chronicle of Philanthropy.

"The public's expectation for an important, well-known organization like the Red Cross is complete, accurate fundraising and spending information," Grassley said in a statement. "In reaction to the news reports on this topic, I'm asking the Red Cross to elaborate on how it calculates the facts and figures given to the donating public."

The Red Cross told Grassley's office that it will set up a briefing with its staff in the next couple of weeks.

"We welcome and look forward to [the] opportunity to talk with Committee staff," Red Cross spokeswoman Suzy DeFrancis said in a statement.

In response to NPR's and ProPublica's initial inquiries on the figures, the charity removed the 91 cents number from its website and said in a statement, "The language used has not been as clear as it could have been, and we are clarifying the language."

In its place, Red Cross officials offered different language. Officials say that on average 91 cents of every dollar they "spend" (as opposed to "donated") goes to disaster services. Officials say that's what they had meant to say all along.

A Senate aide involved in the discussions with the Red Cross called that alternate language "not helpful."

Because the Red Cross' main business is collecting and selling blood, the statistic provides no real information on how much money is spent on disaster services, according to the records the charity provides.

The aide says they intend to get to the bottom of the numbers and ask why that information has not so far been spelled out.

This story was reported in partnership between NPR News Investigations and ProPublica. To read more on this story from ProPublica, go here. Can you help? Email NPR correspondent Laura Sullivan or share a tip here.

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