A network of four cancer charities has been outed as a hundred-million-dollar scam.
The Federal Trade Commission and attorneys general from all 50 states allege the Cancer Fund of America, the Breast Cancer Society, the Children's Cancer Fund of America and Cancer Support Services are completely and totally fraudulent. All told, the four organizations redirected more than $187 million in donated funding from cancer patients to the pockets of scammers.
Collectively, just 3% of donations to the four charities actually ended up benefiting cancer patients. The FTC alleges that the remaining 97% went to lavish fundraisers and a dizzying array of personal and luxury goods including "vehicles, personal consumer goods, college tuition, gym memberships, Jet Ski outings, dating website subscriptions, luxury cruises and tickets to concerts and professional sporting events."
The charities also claimed on tax returns that they had shipped donated goods worth millions of dollars to benefit cancer patients overseas. According to CNN, reporters sent to Guatemala in 2014 "could find no evidence that they even existed."
A questionable history: The network of scammers, which was previously the focus a 2013 CNN investigation, was operated by James Reynolds along with his son and ex-wife.
A 2013 Center for Investigative Reporting investigation concluded the charities simply accepted donations of goods from various companies, paid the shipping fees to send out the care boxes to cancer patients and pocketed the rest of the money.
The "charities" cut corners by not acting on promises to drive cancer patients to chemotherapy and, in lieu of providing substantial pain medication, simply mailing out ibuprofen. Carol Smith, a 67-year-old whose husband had lung cancer, told the CIR a box sent to her by the Cancer Fund of America "was filled with paper plates, cups, napkins and kids' toys. My husband looked like somebody slapped him in the face. I just threw it in the trash."
What happens now? On their website, the FTC said some of the scammers had agreed to settlements and will be banned from "fundraising, charity management, and oversight of charitable assets." While two of the charities will be dissolved, it said, "litigation will continue against CFA, CSS and James Reynolds Sr."
"The defendants told donors their money would help cancer patients, including children and women suffering from breast cancer, but the overwhelming majority of donations benefitted only the perpetrators, their families and friends and fundraisers," the agency wrote.
FTC Bureau of Consumer Protection Director Jessica Rich added in the statement, "The defendants' egregious scheme effectively deprived legitimate cancer charities and cancer patients of much-needed funds and support."
Rich told CNN the agency would be lucky to recover $1 million of the inappropriately earned money.
Correction: May 20, 2015
An earlier version of this article featured a headline stating that funds had been distributed to 187 million cancer patients. The charities redirected $187 million to scammers.