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One of Canada’s Largest Charities Revoked: A Case Study for Donors to Avoid Bad Charities

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text-align: left; Few have ever heard of the charity called Beth Oloth, including experts in Canada’s philanthropy sector. Yet, Beth Oloth was one of Canada’s largest charities. It was the same size as more familiar charities like Doctors Without Borders, Queen’s University, and the United Way Montreal. On January 12, 2019, the Charities Directorate revoked Beth Oloth’s charity status. Beth Oloth has 90 days to appeal this decision. 
Beth Oloth is a huge Canadian charity. Beth Oloth most recently reported receiving $59.4 million in donations and grants from foundations[i]. That’s incredible fundraising for one staff and two directors acting alone. 
This is a cautionary story for donors. Just because a charity is big, does not make it “good”, and just because it is getting lots of money, donors cannot neglect due diligence. For those who care about giving intelligently, there were early warning signals. 
Subscribers to Charity Intelligence’s star ratings got the heads up in August 2017. Charity Intelligence rated # Beth Oloth zero out of four stars. Our concerns made us take the extra step to add a donor advisory. Charity Intelligence’s research and rating subscription can help you give better, instead of simply using gut feel and emotion. 
Read more:
research-and-news/ci-views/charity-news/what-about-gates-of-mercy Growing Concerns about Gates of Mercy
# Charity Transparency Matters
# What Donors Can Do to Improve Transparency
 
Early warning signals
When most donors think of “bad” charities, they most likely picture small scams or hucksters going door-to-door, and not elite Canadian charities. Yet, Beth Oloth was part of our Major 100 index, among the largest charities in Canada. 
To recap, Charity Intelligence’s Major 100 index is a list of Canada’s largest 100 charities measured by donations and support from fundraising and special events. The Major 100 Index represents the elite 0.1% of Canada’s 86,000+ registered charities. Together, Canada’s Major 100 charities received $6.2 billion in donations in their most recent reported year. This is approximately 38% of total Canadian giving (assuming total Canadian annual giving is $16 billion). 
Beth Oloth is the sixth of Canada’s Major 100 charities to be revoked in the last seven years. When large public companies run into problems, there is media attention alerting shareholders, as there was in the case of Enron, BreX, and Sino-Forest. Yet, donors get little notice about charities in trouble with regulators. Charity Intelligence believes early warning signals benefit intelligent donors. 
 
Spot the Markers?
Stats on Major Charities that have been revoked: 

Charity (name linked to Ci report of revocation year) Ci Star Rating (out of 4) Financial Transparency (out of 3) Results Reporting Grade Cents to the Cause (“Overhead Ratio”) Donations ($million)
# Beth Oloth Charitable Organization – 2019 0 0 F 99.9 42.9
# Vaad Mishmeres Mitzvos Committee to Observe the Torah Laws – 2017 0 0 F 99.4 24.6
# Canadian Friends of Pearl Children – 2015 nr 0 nr 97.7 57.4
# Ecotecture: Centre for Ecological Art & Architecture – 2014 nr 0 nr 100 49.3
# HEDAC – Help Eliminate Disease and Addiction Canada – 2012 nr 0 nr 97.1 38.9
# Malvern Rouge Youth Centre – 2011 nr 0 nr 87.1 120.3



These Major 100 charities that were ultimately revoked look alike. None had financial transparency. Results reporting grades are all Fs using the Keystone Accountability scorecard. Donors may be tricked into believing extremely low overhead costs show great value. Yet, when overhead costs are less than 5%, donors need to pay extra attention. This is exactly why Charity Intelligence’s overhead costs analysis has an upper red zone. 
 
What about Gates of Mercy?
With Beth Oloth’s revocation, comments were made about what took the Charities Directorate so long[ii]. Expert charity lawyer Mark Blumberg commented “if abuses like these are allowed to continue it will undermine the public’s confidence in the whole charitable sector” and the government should be embarrassed the charity was allowed to operate for so long. 
Our current laws muzzle the Charities Directorate from informing us. The Charities Directorate must follow due process and do exhaustive audits and investigations. In the Beth Oloth case, the investigation was dragged on by lawyers and spanned more than two years. It is alarming that in these two years under investigation, Beth Oloth tax receipted $49.9 million in donations and received an additional $53.9 million from private foundations. Currently, the Charities Directorate cannot suspend “trading” or notify donors until it makes its final decision. In contrast, British laws allow its Charities Commission to prominently notify the public when a charity is under investigation. 
Yet the Charities Directorate is not silent in the Beth Oloth case. Its https://www.globalphilanthropy.ca/images/uploads/NITR_Beth_Oloth_Charitable_Organization_Redacted.pdf investigation notes report a curious relationship between Beth Oloth and # Gates of Mercy, another Toronto-based charity. Numerous cheques made out to Gates of Mercy were deposited into Beth Oloth’s bank account; an American GoFundMe page told supporters that money could be tax-receipted by Beth Oloth, with instructions to mail cheques to Rabbi Reidel, a director of Gates of Mercy. In the Charities Directorate’s investigation, Beth Oloth claimed there is no ongoing relationship between itself and Gates of Mercy. 
Gates of Mercy is an active charity that Charity Intelligence rates. We rate Gates of Mercy zero for its financial transparency and give it an F grade on results reporting. Its financial statements are unaudited. It has one staff that raises $10.2 million in donations. It is extremely cost efficient with overhead costs of only 0.9%. Given these signs, Charity Intelligence has added a donor advisory. 
Sources: 
http://www.gazette.gc.ca/rp-pr/p1/2019/2019-01-12/html/commis-eng.html Revocation of Beth Oloth Charitable Organization, Canadian Gazette, January 12, 2019
[i] Charities Directorate annual return for Beth Oloth, accessed February 5, 2019 Charities Listing, https://apps.cra-arc.gc.ca/ebci/haip/srch/t3010form23-eng.action?b=118807080RR0001&fpe=2017-09-30 2017 Annual Return Beth Oloth, Government of Canada
[ii] Stewart Bell, ” https://globalnews.ca/news/4893430/canada-charity-jewish-group-foreig-armed-forces/ Government revokes charity status of Canadian Jewish group that supported ‘foreign armed forces’,” Global News, January 28, 2019
 


 
If you find Charity Intelligence’s research useful in your giving, please consider donating to support our work. Being entirely funded by donors like you maintains our independence and objectivity to help Canadians be informed in their giving. Canadians donate over $17 billion each year. This giving could achieve tremendous results. We hope Charity Intelligence’s research helps Canadians give better.
Legal disclaimer:
The information in this report was prepared by Charity Intelligence Canada and its independent analysts from publicly-available information. Charity Intelligence and its analysts have made endeavours to ensure that the data in this report is accurate and complete but accepts no liability.
The views and opinions expressed are to inform donors in matters of public interest. Views and opinions are not intended to malign any religion, ethnic group, organization, individual or anyone or anything. Any dispute arising from your use of this website or viewing the material hereon shall be governed by the laws of the Province of Ontario, without regard to any conflict of law provisions. 
 

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Japan: Disaster Relief Giving Tips

A 9.0 magnitude earthquake struck Japan north of Tokyo on March 11. This disaster was closely followed by an extremely destructive tsunami, destroying several coastal towns. The results have been devastating. Estimates report injuries and fatalities are in the thousands and the death toll is expected to rise. Charities are beginning to solicit and make appeals for donations in an emergency response to help provide relief to those in need. 
 
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If you find Charity Intelligence’s research useful in your giving, please consider donating to support our work. Being entirely funded by donors like you maintains our independence and objectivity to help Canadians be informed in their giving. Canadians donate over $17 billion each year. This giving could achieve tremendous results. We hope Charity Intelligence’s research helps Canadians give better.
Legal disclaimer:
The information in this report was prepared by Charity Intelligence Canada and its independent analysts from publicly-available information. Charity Intelligence and its analysts have made endeavours to ensure that the data in this report is accurate and complete but accepts no liability.
The views and opinions expressed are to inform donors in matters of public interest. Views and opinions are not intended to malign any religion, ethnic group, organization, individual or anyone or anything. Any dispute arising from your use of this website or viewing the material hereon shall be governed by the laws of the Province of Ontario, without regard to any conflict of law provisions. 

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Statement from Charity Intelligence: CBC Investigative Report on External Fundraisers

On September 22nd 2010, CBC featured a report on external fundraisers hired by charities. Charity Intelligence was among several charities interviewed for this report. 
 
class=”download-report-button” images/viewsreports/statement-from-charity-intelligence—cbc-report-on-external-fundraising.pdf Download our Report
 


 
If you find Charity Intelligence’s research useful in your giving, please consider donating to support our work. Being entirely funded by donors like you maintains our independence and objectivity to help Canadians be informed in their giving. Canadians donate over $17 billion each year. This giving could achieve tremendous results. We hope Charity Intelligence’s research helps Canadians give better.
Legal disclaimer:
The information in this report was prepared by Charity Intelligence Canada and its independent analysts from publicly-available information. Charity Intelligence and its analysts have made endeavours to ensure that the data in this report is accurate and complete but accepts no liability.
The views and opinions expressed are to inform donors in matters of public interest. Views and opinions are not intended to malign any religion, ethnic group, organization, individual or anyone or anything. Any dispute arising from your use of this website or viewing the material hereon shall be governed by the laws of the Province of Ontario, without regard to any conflict of law provisions. 

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Haiti: Why I am Recommending Donations to Doctors Without Borders

On January 12th 2010, a 7.0 magnitude earthquake struck Haiti just west of the capital, Port-au-Prince. Over the past week, friends and family have asked which charities I would recommend supporting to help Haiti. 
 
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Fort McMurray Fires: Where to Give

Updated May 11, 2016
The wildfire in Fort McMurray, Alberta, is catastrophic, forcing the evacuation of 80,000 people. Thankfully there have been no lives lost at this stage. This will likely be Canada’s largest disaster, surpassing the 1998 Quebec Ice Storm. The 2011 Slave Lake wildfire destroyed 433 properties, forcing the evacuation of 7,000 people. In Fort McMurray, 2,400 properties are destroyed (10% of Fort McMurray’s buildings). 
All Canadians want to know how to help. Charity Intelligence is recommending:
1. For emergency response to help evacuees, donate to local charities in Edmonton (e.g. Edmonton Food Bank)
2. For rebuilding, consider local charities in Fort McMurray (see below).
Canadian Red Cross Update: as in all disasters, the Canadian Red Cross receives the lion’s share of donations. As of May 11, the Canadian Red Cross has received $67 million in donations, before the matching funds from the Federal and Alberta government. Canadians have been unbelievably generous in their support for Fort McMurray. This is the largest and fastest donor response to a Canadian disaster. 
May 11, 2016: The Canadian Red Cross announces that it will be distributing $50 million of these donations in cash transfers to Fort McMurray evacuees. This size and speed of disbursement is unprecedented in Canadian Red Cross history. Charity Intelligence applauds this decision. It empowers each evacuee to best meet immediate needs. In disaster response, speed matters. Direct cash transfers is a proven, effective way to provide aid. 
Consider giving to charities other than Canadian Red Cross: the vast majority of donations for this disaster response go to the Canadian Red Cross; Fort McMurray’s local charities are largely overlooked by donors. In looking back over the Lac Megantic train disaster and also the Alberta Floods of 2013, Charity Intelligence was particularly impressed by how local, grassroots charities responded quickly and were able to provide effective disaster help and also lead the rebuilding. In this emergency, give differently, and donate to local charities. 
Listen or Read Kate Bahen’s interview with CBC Radio As It Happens Carol Off, ” https://www.cbc.ca/radio/asithappens/as-it-happens-friday-edition-1.3570444/fort-mcmurray-why-is-ottawa-only-matching-donations-to-the-red-cross-1.3570449 Fort McMurray: Why is Ottawa only matching donations to the Red Cross?”
 
Fort McMurray local charities
When people return to Fort McMurray, its local charities will need donations to help the people. The needs will be greater than ever. Charity Intelligence has pulled from the CRA Charities Listing a full list of Fort McMurray local charities that received donations over $100,000 in 2013 (the most recent year available). Charity Intelligence has a rating and review on only one of these local charities. But given the size of their local support with donations over $100,000, these are the local charities the people of Fort McMurray supported most (see below). 
Fort McMurray’s disaster response will likely have 2 distinct phases: first, the disaster response helping 80,000 evacuees live and cope in temporary shelter, and second, helping these people rebuild when they return to Fort McMurray. 
 
For Fort McMurray’s evacuees – disaster response:
Edmonton’s Food Bank – first responder providing food and essentials to so many of the evacuees who have fled to Edmonton. In addition, Edmonton Food Bank will send food shipments to Fort McMurray and other local centres helping the evacuees. # Click to read Charity Intelligence’s report on Edmonton’s Food Bank 
https://www.edmontonsfoodbank.com/donate Donate to Edmonton’s Food Bank
Salvation Army Community in Fort McMurray – https://secure.salvationarmy.ca/registrant/EventClosed.aspx?eventID=197650&langPref=en-CA donate online to the Salvation Army Alberta Fire Response or text FORTMAC to 45678
CBC Edmonton has posted this information regarding the family pets of evacuees. One may think that disaster recovery is not a time to support animals. However, the emotional distress of losing family pets can increase the psychological distress on evacuees. For families living in their cars or in emergency shelters, taking care of pets can be a heavy burden. 
Alberta’s SPCA is rescuing pets from Fort McMurray and coordinating their return to their families. https://www.albertaspca.org/support.html Donate to Alberta SPCA
Edmonton Humane Society – can shelter family pets and is preparing to go to Fort McMurray to rescue any animals left behind. # Click to read Charity Intelligence’s review on Edmonton Humane Society 2011
https://www.edmontonhumanesociety.com/how-to-help/donate/donate-now/ Donate to Edmonton Humane Society
https://www.cbc.ca/news/canada/edmonton/fort-mcmurray-evacuees-a-list-of-resources-available-across-alberta-1.3566500 CBC Edmonton also reports Alberta Animal Rescue Crew doing similar work. 
Donors know that Edmonton and Alberta have highly-developed economies. It is heart-warming to hear about groups across Canada preparing to send items like toiletries, diapers, clothing, food and water to Edmonton. These good intentions are sincere, but a waste of essential resources. When far away from a disaster location, sending money is the most efficient way to help. 
 
Rebuilding Fort McMurray
Rebuilding Fort McMurray will be a long-term project and will likely cost far more than the emergency response. Families and charities with insurance should have the financial support to get back on their feet. Fort McMurray charities will also have lost their buildings. It isn’t known right now which Fort McMurray charities have suffered loss. There are 74 charities registered in Fort McMurray. Churches, and other religious centres are often the community hub that will need to be rebuilt. We will keep monitoring the situation to understand which local charities also need to rebuild. 
United Way of Fort McMurray –  # click to read Charity Intelligence’s 2015 rating on United Way of Fort McMurray 
https://give.unitedway.ca/donate/WFORTM Donate to United Way of Fort McMurray
The agencies the United Way supports in Fort McMurray include: 
Charities helping seniors: St Aidan’s Society, McMan and Golden Years Society 
For Youth: https://www.canadahelps.org/en/charities/fort-mcmurray-boys-girls-club/ Fort McMurray Boys and Girls Club, http://fmcentreofhope.com/donate/ Centre of Hope, the Children’s Centre operating since 1994, provides free pre-school early education program for toddlers and parents preparing children for school. 
Waypoints: formerly Fort McMurray Family Services just opened in June 20155 a $25 million new building providing 78 apartments providing second-stage housing and a women’s shelter. 
http://www.fmmfcs.com/donate/index.html Donate to Waypoints
A Summary of Fort McMurray’s local charities with donations over $100,000 and not government charity agencies (school boards) with low cash and investments to tap into:

 
*cash and investments the charity holds for an emergency contingency 
requested by a Ci donor; figures from 2014 audited financials. Financial data pulled from CRA Charities Listings for 2013. Descriptive information found on the charities’ websites. 
 
May 10, 2015: The Globe and Mail reports that Fort McMurray’s schools are fine. Fort McMurray’s Northern Lights Hospital is apparently fine. 
Charity Intelligence has not included in this list Fort McMurray Catholic Board of Education (reporting funding reserves of $19.1 million), Fort McMurray School District No. 2833 (this is a provincially-funded school and it reports $11.1 million in cash and investments), and Fort McMurray Historical Society (funding reserves reported at $6.3 million). 
Local charities and the Red Cross
How much of Red Cross donations goes to local charities? On May 12, 2016, the Red Cross released its community grants reporting that $12.0 million supported 102 local Alberta charities in the Alberta Flood relief efforts. This represents 28% of donations. This is significantly higher than the 2% Charity Intelligence reported. Charity Intelligence appreciates the Red Cross’ disclosure. # Charity Intelligence’s explanation on these revised numbers 
It is noteworthy that the Canadian Red Cross also recognizes that donations in the hands of local charities can be the most effective way for communities to rebuild. 
People Charity Intelligence highly respects in Canada’s charity sector, Malcolm Burrows at Scotia, Bob Wyatt at the Muttart Foundation and Eva Friesen at the Calgary Foundation are also recommending donations to local charities for Fort McMurray’s disaster relief and recovery. https://www.theglobeandmail.com/news/national/red-cross-working-fast-to-distribute-funds-to-fort-mcmurray-to-residents/article30025068/ Globe and Mail May 14, 2016 article
 


 
If you find Charity Intelligence’s research useful in your giving, please consider donating to support our work. Being entirely funded by donors like you maintains our independence and objectivity to help Canadians be informed in their giving. Canadians donate over $17 billion each year. This giving could achieve tremendous results. We hope Charity Intelligence’s research helps Canadians give better.
Legal disclaimer:
The information in this report was prepared by Charity Intelligence Canada and its independent analysts from publicly-available information. Charity Intelligence and its analysts have made endeavours to ensure that the data in this report is accurate and complete but accepts no liability.
The views and opinions expressed are to inform donors in matters of public interest. Views and opinions are not intended to malign any religion, ethnic group, organization, individual or anyone or anything. Any dispute arising from your use of this website or viewing the material hereon shall be governed by the laws of the Province of Ontario, without regard to any conflict of law provisions. 

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