MUSC Hollings Cancer Center awarded funds following action against sham cancer fund charities

On Wednesday, South Carolina Secretary of State Mark Hammond announced the allocation of a $39,024 disbursement to MUSC Hollings Cancer Center, following a landmark enforcement action against four sham charities and their directors.

“It is so rare that funds are recovered from these bad actors and then distributed to the actual cause that the donors intended to support,” said Hammond in a press conference held at Hollings. “I am happy that South Carolina residents are seeing a direct benefit from this enforcement action through such a worthy organization as MUSC Hollings Cancer Center.” 

Hammond said that he wants South Carolinians to know the nonprofits they choose to donate to are legitimate and use the funds as they were intended to be used. He was pleased to present the distribution to Hollings for its role in combating cancer and serving rural and underrepresented communities in South Carolina.

“Because of the hard work at MUSC Hollings, the National Cancer Institute certification and the patient care Hollings provides, this was the only site in South Carolina to receive money from this settlement,” Hammond said.

Hollings Cancer Center director Raymond N. DuBois, M.D., Ph.D., thanked Hammond for presenting Hollings with the funds. “While it’s unfortunate that the donations were collected under false pretenses, it’s wonderful that they will finally be used for those donors’ original reasons to give, which is to help cancer patients.”

These funds will help to support hundreds of breast and pediatric cancer patients at Hollings, said Debbie Bordeau, Hollings’ director of development. “The money will help to provide financial assistance for housing, travel, meals, medication and other necessities. These funds will also support our survivorship programs, which give cancer survivors the education and tools they need to improve both their mental and physical health after battling this fearsome disease.”

 

Michelle P. Hudspeth, M.D., director of the Division of Pediatric Hematology and Oncology, said these funds will go a long way in helping families who are most in need.

“These families are fighting not only an enormous medical battle but also an enormous financial battle and intense emotional battle,” Hudspeth said. “Some of our families are traveling over 200 miles for care. This money will make an incredible difference in our efforts to continue serving the children and their families in South Carolina.”

In this unprecedented effort, the South Carolina Secretary of State’s office joined the other 49 states, the District of Columbia and the Federal Trade Commission in May 2015 to shut down permanently the Cancer Fund of America, The Breast Cancer Society, Cancer Support Services, and Children’s Cancer Fund of America.

The fraudulent charities, which were operated by Jim Reynolds along with his friends and family members, bilked donors out of more than $187 million between 2008 and 2012. The multistate complaint, filed in May 2015, included counts of systematic misrepresentations to the public about the organizations’ charitable programs, manipulations of the values assigned to donated items on their tax forms to make the organizations appear larger and more efficient than they were and the Reynolds family’s personal use of donated funds.

For example, the Reynolds family used donations to pay themselves exorbitant salaries and hold board meetings on cruises and at vacation destinations like Disney World. Of the $187 million raised by the defendants, only 3% was directed to cancer patients in the United States in the form of “care packages” containing the likes of religious DVDs, Moon Pies, random pieces of clothing and various items that lacked any palliative or supportive use for Americans suffering from cancer. 

Following the filing of the multistate enforcement action in 2015, the organization's assets were liquidated. Final court orders were issued in March 2019 by Arizona U.S. District Court Judge Neil V. Wake, approving the charity regulators’ recommendation that the recovered funds be distributed to Rockefeller Philanthropy Advisors, which would then allocate funds to National Cancer Institute Cancer Care Centers throughout the country for the provision of care and services to cancer patients in all 50 states. The goal of this distribution was to ensure that the recovered funds go to provide direct assistance to cancer patients as intended by the original donors to the fraudulent cancer charities.

Since that time, approximately $2.5 million has been distributed, including the $39,024 distribution to MUSC Hollings Cancer Center, the state’s only National Cancer Institute-designated cancer center.   

Hammond said that he hopes this landmark case serves as an example that scammers will not be tolerated in South Carolina.

“Not only is this an historic case in the area of charities regulation, but it stands as a warning to those who exploit people seeking to help others through charitable donations,” said Hammond. “I encourage anyone who has any concerns about a charity, professional fundraiser or nonprofit raffle to contact the Division of Public Charities at charities@sos.sc.gov or 1-888-CHARITI (242-7484). You can also use the Online Charitable Solicitation Complaint Form at sos.sc.gov to file a confidential complaint 24 hours a day, seven days a week.”

This project was supported by the Cancer Charities Settlement Fund of Rockefeller Philanthropy Advisors.

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