A lawsuit has been filed against four cancer charities and its directors for allegedly using $187 million worth of donations for personal expenses. The defendants allegedly used donor money to fund their dating sites and gym memberships, vacations in luxury cruises, college tuition for their children and their friends' children as well as sporting events and concert tickets.
The suit, filed by the Federal State Commission (FTC) – including attorney generals in 50 states – named Cancer Fund of America, Inc., Cancer Support Services Inc., Children's Cancer Fund of America, Inc. and The Breast Cancer Society Inc. as defendants. These four organizations were established by James Reynolds Sr. along with his ex-wife and son, who are also defendants, according to Time Magazine.
Donors had been informed, via mailing and phone calls, that the money they donated will be spent for chemotherapy sessions, patient transport, medication and hospice care. But the defendants have been found to have "operated as personal fiefdoms characterized by rampant nepotism, flagrant conflicts of interest and excessive insider compensation," as revealed in the complaint, according to Market Watch.
At least two of the organizations – Children's Cancer Fund of America, through Rose Perkins, its director, and the Breast Cancer Society, through James Reynolds II, its CEO – have already agreed to settle out of court, reports state. But should the case against the rest of the defendants continue, it will be the largest joint-action case against charity organization by the FTC.
"The defendants' egregious scheme effectively deprived legitimate cancer charities and cancer patients of much-needed funds and support," said Jessica Rich from the Federal Trade Commission's Bureau of Consumer Protection in a report from USA Today.
"I'm pleased that the FTC and our state partners are acting to end this appalling scheme," she added.
The suit was lodged at the Arizona District Court.
