As the director of a national nonprofit organization serving Indian people, I know how hard it is to meet the expectations of the people who evaluate us. We are not perfect, but many of the “Indian” charities are simply rotten.

One of our large donors asked me 20 years ago to research the charities she was giving money to. There were over 100 of them, with some 25 being Indian charities. Out of the 25, about 20 were rotten. It was way beyond my expectations. She curtailed her giving to most of them.

Indian charities serve education, health, economic development, domestic abuse, and many other causes. Most of them are run by non-Indians, which is admirable. But the rotten ones are not admirable. They need to be held accountable, but seldom are.

My best friend told me about one of them 40 years ago. His mother-in-law worked there, opening checks and preparing bank deposits most of the day. They had a well-oiled machine. But they abused their privileges; they had their own airplane to fly the money into the bank every day. They are still doing that.

Another non-Indian runs the largest pow wow in the world every spring in Albuquerque. When he asked the mayor, Martin Chavez, to give them $30,000 for security, Marty asked if they had gone through the Indian Commission. They had not. I was chairing the commission at the time. So at the next meeting the man’s daughter showed up and read a slightly insulting letter to us, and would not answer any questions.

We turned them down for their request for security money. They would not answer any questions about who was on their board, what their financial situation was, how much money they made, and what happened to the money. We since learned that they make over $500,000 a year and no one except a handful of people knows what happens to the money.

The only real protest they have ever had is from the late Russell Means and a handful of his friends. They showed up and held signs against the pow wow. But apparently they had little if any impact. People had driven from Montana and South Dakota to see that pow wow, and they were not about to let Russell stop them.

The latest bad news is that the former director of the National Relief Charities (NRC), Brian Brown, has been indicted for stealing $4 million from that organization. He was charged with wire fraud and money laundering. Allegedly for years he had a new Cadillac leased and paid for by the organization.

(I also hate to admit this, but one of our supposedly honest Indian nonprofits also paid for a leased Cadillac for its former executive director. To their credit, when the board found out, they let him go. )

Brown was on his way back from a trip to Thailand and Japan when he was arrested at Portland, Oregon International Airport on October 20. He had spent $275,000 of the $4 million to buy a condo in Thailand, where he lived from 2006 to 2013. FBI agents and federal prosecutors are trying to determine if he used his overseas connections to hide some of his assets. They could use this to bring additional charges against him.

He was supposed to be using the $4 million in money for scholarships, but U. S. Attorney Amanda Marshall alleged that he had not paid any of it out for that purpose. He kept it all. She alleges that he provided false financial statements to the NRC to delude them into thinking he was using the money properly.

“Anyone who defrauds a charity for their own personal gain should expect to be found, caught, and prosecuted,” she said.

NRC raised $45 million last year, but their overhead is large. They spent almost $18 million on fundraising expenses—a very large amount. Very little of the money they raise gets to their target audience, which is supposed to be Indians living on reservations. One of the stories I heard about them 20 years ago is that they spent a few hundred dollars buying vegetable seeds and took them to reservations in South Dakota.

They have also moved around frequently. They started in Pennsylvania, moved to Rapid City, then to Arizona, then to Oregon, then back to Rapid. They still have an office in Beaverton, Oregon, even though their scholarship office is in Rapid City.

Most of the charities play on the “poor Indian” routine. It may be children, or the elderly, or poor people without jobs. One of my friends has called me twice in the past few weeks asking if an appeal he has gotten on the phone is legitimate. I asked him for the name of the charity, which he had forgotten. But they have gall. They asked him for $4,000.

The Attorney General of Pennsylvania, Mike Fisher, charged NRC in 1993 with using false claims in its mail appeals. They claimed that Indians were starving to death on South Dakota reservations, and other outlandish claims. They agreed to pay $395,000 in restitution to the state, which then paid the money to three South Dakota reservations—Pine Ridge, Rosebud, and Cheyenne River. The American Institute of Philanthropy (AIP), one of five accrediting agencies for nonprofits, gave NRC a grade of F.

According to an article in the Phoenix New Times on December 26, 1996, reporter Paul Rubin detailed how Brown had moved the NRC from Rapid City to Phoenix, changed its name, hired a new manager, and stepped up its fleecing activities. The title of the article was “Finances with Wolves.” It partly forced Brown to move the so-called charity to Beaverton, Oregon, his hometown.

“For a lot of Indian families on the reservation,” read a note from Brown, “the basic nutritious food we supply is often the first well-balanced meal they’ve had in weeks or months.” Brown never had contact with the tribal officials of the tribes he was allegedly serving, who were outraged when they found out what he was doing.

In 1995 NRC paid its attorneys $175,000—more than it paid to its Indian clients. They have also used several names, including American Indian Relief Council, the Famine Relief Fund, and the Council of Indian Nations. Tom Hennessey, the general manager when NRC was located in Phoenix, is convinced that Brian Brown is nothing but a scam artist.

Many of them are “boiler room” operations, which National Relief Charities has been operating for almost 30 years. They have trained solicitors in a large room calling people to ask for money.

I hate to be the bearer of bad news. And I hate it that so few of the donors to these charities will see this column. If they do, I hope they will check out the rotten Indian charities before they send their hard-earned money to a bad charity.

Dr. Dean Chavers runs Catching the Dream, a Native scholarship program in Albuquerque. His next book will be “The American Indian Dropout,” to be published by Peter Lang in the Spring. Contact him at This email address is being protected from spambots. You need JavaScript enabled to view it..

 


NRC Response to “Rotten American Indian charities”

As the President of National Relief Charities, I am responding to the December 4, 2013 story written by Dr. Dean Chavers. I appreciate that some of the facts included in Dr. Chavers’ story are correct. NRC has had an experience that sadly is experienced by many organizations and individuals – trust placed in someone was betrayed. Since learning of the fraud and deception committed by Brian Brown and the Charity One organization, NRC engaged legal counsel to conduct an investigation, alerted the FBI and cooperated with their investigation, and filed a civil complaint with the court system in Texas where we are headquartered. Progress has been made. The FBI made its first arrest and indictment in the case (Brian Brown), and the court issued a judgment ordering the defendants associated with Charity One to repay the grant to NRC, with interest and legal fees. We continue to work with state and federal authorities to recover the funds. Fortunately, this fraud did not disrupt our scholarships and other humanitarian services on the 65 reservations we serve in 11 states.

Although the grant funds awarded to Charity One were misused, an independent audit of all grants supported by NRC resulted in no performance issues being identified with any other grant. Readers should know that since the Charity One grant in 2006 NRC has strengthened our own internal controls and safeguards. Every Board member that started the Charity One grant has been removed, and none are now affiliated with NRC in any way. Six new members have joined NRC’s Board of Directors since that time. We established a Finance and Audit Committee to provide independent oversight of NRC’s finances.. Other safeguards we’ve put in place include undergoing an independent organizational risk assessment and adopting best practices such as hiring a nationally recognized auditing firm to annually review our finances and a Chief Financial Officer.

Some of the misinformation in Dr. Chavers’ story must be clarified:  NRC paid $350,000 to the State of Pennsylvania as a voluntary settlement to end a lengthy and costly lawsuit that occurred 20 years ago. The settlement agreement states there was no finding of wrongdoing by NRC. Our request that the settlement be used to assist tribes already receiving services from NRC was honored by the state. At no time during this litigation did legal expenses exceed services to the reservations. In 1995, NRC provided about $1 million worth of support to the 15+ reservations served at the time – today NRC provides more than $30 million in support that benefits 250,000 Native Americans annually. NRC has not had an office in Oregon for several years and has never owned an airplane. Our organization is headquartered in Sherman, Texas. When NRC opened our Phoenix program office and distribution center, our South Dakota program office and distribution center also remained open. For accurate and up-to-date information on NRC, we invite readers to review our 2012 annual report and form 990 on our website at www.nrcprograms.org. You may also contact us at 800-416-8102 or This email address is being protected from spambots. You need JavaScript enabled to view it. with any questions

 

Robbi Rice Dietrich, President, National Relief Charities