Money raised for 9/11 charities unaccounted for

NEW YORK – Americans eager to give after the Sept. 11 terrorist attacks poured $1.5 billion into hundreds of charities established to serve the victims, their families and their memories.

A decade later, many of those nonprofits have miserably failed.

There are those that spent huge sums on themselves, those that cannot account for the money they received, those that have few results to show for their spending and those that have yet to file required income tax returns. Yet many of the charities continue to raise money in the name of Sept. 11.

One charity raised more than $700,000 for a giant memorial quilt, but there is no quilt. Another raised more than $4 million to help victims, but didn’t account publicly for how it spent all of the money. A third helps support a 9/11 flag sold by the founder’s for-profit company.

There are other charities that can account for practically every penny raised – except that all the money went to pay for fundraising, and not the intended mission.

Most charities successful

To be sure, most of the 325 charities identified by an Associated Press investigation followed the rules, accounted fully for their expenditures and closed after fulfilling identified goals.

But in virtually every category of Sept. 11 nonprofit, tax documents and other official records show schemes beset with shady dealings, questionable expenses and dubious intentions. Many of those still raising money are small, founded by people with no experience running a nonprofit.

The Arizona-based charity that raised $713,000 for a Sept. 11 memorial quilt promised it would be big enough to cover 25 football fields, but there are only several hundred decorated sheets packed in boxes at a storage unit.

One-third of the money raised went to the charity’s founder and relatives, according to tax records and interviews.

Those records show founder Kevin Held also spent more than $170,000 on travel since 2004. He also listed $36,691 in credit card and bank charges since 2005 and $10,460 for an expense listed as “petty” in 2009.

The chairman of the board, an 84-year-old Roman Catholic priest, says he didn’t know he was chairman and thought that only small amounts of money had been raised. He says he was unaware that the founder had given himself a $200-a-week car allowance, rent reimbursement and a $45,000 payment for an unreported loan.

Held acknowledges he struggled managing the charity’s finances, but he said he didn’t live off the nonprofit. “If I made a mistake, I made a mistake. If I did, then crucify me. I never said I was a professional at this.”

A variety of dubious efforts

There’s a charity for a 9/11 Garden of Forgiveness at the World Trade Center site – but there’s no Garden of Forgiveness. Tax records show the charity has raised $200,000, and that the Episcopal priest who founded the Sacred City nonprofit in 2005 – the Rev. Lyndon Harris – paid himself $126,530 in salary and used another $3,562 for dining expenses between 2005 and 2007.

Harris said he sees his charity’s work as a success even if there is no garden at the site. “I saw our mission as teaching about forgiveness,” he said.

Another Manhattan Sept. 11 charity, Urban Life Ministries, raised more than $4 million to help victims and first responders. But the group only accounted for about $670,000 on its tax forms. Along with almost four dozen other Sept. 11 charities, Urban Life lost its IRS tax-exempt status this year because it failed to show how money was collected and spent.

The Flag of Honor Fund, a Connecticut charity, raised nearly $140,000 to promote a memorial flag honoring Sept. 11 victims. The flag, which contains the name of every person killed on Sept. 11, 2001, is on sale today at Walmart and other retail stores. But only a tiny fraction of the money from those sales goes to 9/11 charities, with most going to retail stores, the flag maker and a for-profit business – run by the man who created the flag charity.