Scam Watch -- By the way, the Southern Poverty Law Center is on the official Scam Watch of iSteve.com. See Ken Silverstein's Harper's article "The Church of Morris Dees: How the Southern Poverty Law Center profits from intolerance" for the basics on Morris Dees' money machine. And here's leftist Alexander Cockburn's column on the SPLC's money-hungry machinations.
Lately, as Morris's moneymaking ambitions have expanded, he has turned to attacking people of the quality of Richard Lamm, the Democratic former three term governor of
Here's something important I hadn't seen before: the revealing statement of Jim Tharpe, the Deputy Metro Editor of the Atlanta Constitution, which he made during a Harvard panel discussion about his experience editing a massive Pulitzer-finalist investigative series on the Southern Poverty Law Center during his days at the
I’d never done any reporting on nonprofits, I thought they were all good guys, they were mom-and-pop, bake-sale, raise-money-for-the-local-fire-department type operations. I had no idea how sophisticated they were, how much money they raised, and how little access you have to them as a reporter, some of which has already been covered here.
Summary of Findings
Our series was published in 1995 after three years of very brutal research under the threat of lawsuit the entire time.
Our findings were essentially these:
The [Southern Poverty Law] center was building up a huge surplus. It was 50-something million at that time; it’s now approaching 100 million, but they’ve never spent more than 31 percent of the money they were bringing in on programs, and sometimes they spent as little as 18 percent. Most nonprofits spend about 75 percent on programs.
A sampling of their donors showed that they had no idea of the center’s wealth. The charity watchdog groups, the few that are in existence, had consistently criticized the center, even though nobody had reported that.
There was a problem with black employees at what was the nation’s richest civil rights organization; there were no blacks in the top management positions. Twelve out of the 13 black current and former employees we contacted cited racism at the center, which was a shocker to me. As of 1995, the center had hired only two black attorneys in its entire history.
Questionable Fundraising
We also found some questionable fundraising tactics. One of the most celebrated cases the center handled was the case of a young black man, Michael Donald, who was killed by Klansmen in
The center, after that part of the case took place, sued the Klan organization to which they belonged and won a $7 million verdict. It was a very celebrated verdict in this country. The problem was the people who killed this kid didn’t have any money. What they really got out of it was a $51,000 building that went to the mother of Michael Donald. What the C enter got and what we reported was they raised $9 million in two years using the Donald case, including a mailing with the body of Michael Donald as part of it.
The top center officials, I think the top three, got $350,000 in salaries during that time, and Morris got a movie out of it, a TV movie of the week. I think it was called, "The Morris Dees Story." [Actually, "Line of Fire: The Morris Dees Story" with, appropriately enough, Corbin Bernsen (who played sleazy lawyer Arnie Becker on "LA Law") as Morris.]
As I said, being the editor on this series really raised my eyebrows. I never knew anything about nonprofits before this. I thought we would have complete access to their financial records; we didn’t. We had access to 990’s, which Doug mentioned earlier, which tell you very little, but they are a good starting point.
Organizations Monitor Nonprofits
I also learned that there are organizations out there that monitor nonprofits. A couple of these that might be worth your time are the National Charities Information Bureau, the American Institute of Philanthropy, and the Charities Division of the Better Business Bureau. They have rather loose guidelines, I think, for the way nonprofits operated, and even with those guidelines, they had blasted the center repeatedly for spending too little on programs, for the number of minorities in management positions, just very basic stuff that they’d been criticized for but nobody had reported.
The relationship with sources on this story was pretty interesting, because like I said, most of these people were our friends, and as somebody mentioned earlier, these were the disillusioned faithful. They were people who didn’t resign. As I said, most of their jobs simply ran out, but they left the center very disillusioned and very willing to talk about it, although most of them wanted to talk off the record.
That presented a number of problems for us. We did not publish anything in the series unless it was attributed to somebody, but we went beyond that. I think if we had stuck with that tack as the only thing we did in the series, we would have ended up with people at the center could have easily dismissed as disgruntled employees.
By looking at 990’s, what few financial records we did have available, we were able to corroborate much of that information, many of the allegations they had made, the fact that the center didn’t spend very much of its money that it took in on programs, the fact that some of the top people at the center were paid very high salaries, the fact that there weren’t minorities in management positions at the center.
If I had advice for anybody looking into a nonprofit it would be this: It’s the most tenacious story. You have to be more tenacious in your pursuit of these things than anything else I’ve ever been a part of. These guys threatened us with a lawsuit from the moment we asked to look at their financial records.
They were very friendly and cooperative, up until the point where we said, "We want to see the checks you write," and they turned over their 990’s and said, "Come look at these." We said, "We don’t want to see those, we know what those are and we’ve seen them. We actually want to see the checks you write," and they said, "Well, there’s 23,000 checks we’ve written over two years, you don’t possibly have time to look through all those," and we said, "Yes, we do, and we’ll hire an auditor to do it."
First Threats, Eventually No Response to Questions
At that point, they hired an independent attorney. They’re all lawyers, you’ve got to understand. They hired an attorney who began first by threatening me, then my editor, and then the publisher. "And you better be careful of the questions you ask and the stories you come up with," and they would cite the libel law to us. So we were under threat of lawsuit for two years, basically, during the research phase of the series.
They initially would answer our questions in person, as long as they could tape-record it. After we asked about finances, they wanted the questions written down and sent to them in advance, and then finally they said, "We’re tired of you guys, we’re not answering anything else," and they completely cut us off.
We published the series over eight days in 1994, and it had very little effect, actually. I think the center now raises more money than it ever has. [Laughter]
The story really didn’t get out of
One of our editorial writers had an interesting comment on it. I think he stole it from somebody else, but his comment was this: "They came to do good and they’ve done quite well for themselves, and they’ve done even better since the series was published." I’m not sure what the lesson in that is, but don’t assume because a nonprofit has a sterling reputation it’s not worth looking into, and don’t assume when you start looking into it that it’s going to be easy to get the information, because it’s not.
My published articles are archived at iSteve.com -- Steve Sailer
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