Wrong Way: Another Treasury Myth about U.S. Charities Busted

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Date: 
October 17, 2011
 

The Department of Treasury has continuously mischaracterized international U.S. charities as a national security threat since 2001. In his 2010 testimony before Congress, Daniel L. Glaser, the Deputy Assistant Secretary of Terrorist Financing and Financial Crimes at Treasury said that charities were “an attractive target for terrorist organizations” because “[u]nlike for-profit organizations, charitable funds are meant to move in one direction only. Accordingly, large purported charitable transfers can move without a corresponding return of value.”
 
 
 
As you can see by the findings in the bar chart, charities are not alone in sending money overseas with little or no economic return back to the U.S.  In fact, unlike some of these areas (e.g. online gambling and remittances) that have little or no record of where the money goes, U.S. charitable groups and foundations must comply with Internal Revenue Service and state and local reporting requirements. It’s time for Treasury to get their facts right and let U.S. humanitarian and development groups do their work.
 
 
 
 Data Sources:
 
1.
Afghanistan
$2,755,671,228
 
6.
Kenya
500,427,374
2.
Pakistan
1,351,634,685
7.
Sudan
462,877,610
3.
Haiti
701,379,625
8.
Jordan
363,375,929
4.
Israel
596,529,460
9.
Ethiopia
350,258,089
5.
West Bank/Gaza
387,120,025
10.
Georgia
339,465,998
11.
South Africa
347,449,184
 
16.
Iraq
220,524,820
12.
Egypt
320,115,027
17.
Indonesia
262,002,937
13.
Nigeria
295,792,542
18.
Congo
163,325,098
14.
Tanzania
312,689,352
19.
Mozambique
234,429,203
15.
Uganda
269,467,038
20.
Liberia
229,133,134
  • Large U.S. foundations spent about $6.7 billion in 2009 on both direct giving to overseas recipients and funding for U.S.-based international programs. http://foundationcenter.org/gainknowledge/research/pdf/intl_update_2010.pdf
     
  • The U.S. is the largest single source of remittances to developing countries around the world. The State Department says at least $60 billion is sent to Latin American countries each year.  http://blogs.state.gov/index.php/site/entry/bridge_power_remittances
     
  • As much as $31-60 billion in U.S. funds has been lost to waste and fraud in Iraq and Afghanistan over the past decade through lax oversight of contractors, poor planning and payoffs to warlords and insurgents, according to an independent panel investigating U.S. wartime spending estimates. http://www.wartimecontracting.gov/
     
  • Top 20 countries receiving USAID grant money for FY2010:
     
 
 
 

 


[1]Testimony of Daniel L. Glaser, Deputy Assistant Secretary, Terrorist Financing and Financial Crimes at the U.S. Department of the Treasury before the House Committee on Financial Services Subcommittee on Oversight and Investigations on May 26, 2010. http://www.house.gov/apps/list/hearing/financialsvcs_dem/final_glaser_testimony_on_charities.pdf