Homeless Charity Revealed As A Fraud

If you live anywhere in the NYC area, you’ve probably seen a “United Homeless Organization” table on the sidewalk, staffed by a volunteer who looks homeless himself. (If you don’t live here, imagine a year-round, homeless Salvation Army Santa.) If you thought the set-ups looked a little sketchy, you were right: the UHO is a “sham,” according to NY Attorney General Andrew Cuomo.

Back in 2001, the New York Times pointed out that the people working the table are themselves homeless and keep whatever they collect, minus a $15 fee. That makes the phrase “donate money for the homeless” a little weird, since really you’re donating to one particular person and not to the organization on the plastic jug. The New York Times let the issue drop, while the New York Post agitated for an investigation.

Attorney General Cuomo has now filed a complaint that says his office has determined the UHO isn’t a charitable organization at all–it’s basically just a couple of people who rent out equipment and a brand identity to homeless people, and then make a profit off of their panhandling:

UHO is a sham. All of the money dropped into the UHO jugs is pocketed by the UHO table workers, [UHO founder and president, Stephen Riley, and its director, Myra Walker], and other insiders, or is used by Riley and Walker to perpetuate a scheme to defraud the public. Riley and Walker run UHO in total disregard ofthe legal and fiduciary requirements that bona fide charitable corporations must follow, resulting in hundreds of thousands of dollars of charitable assets being unaccounted for or misused annually.

As to what Riley and Walker spend the money on, the complaint lists things like fees at Weightwatchers.com, purchases at Toys R Us and Bed Bath & Beyond, and cable bills. The New York Post adds to that list: a $3,000 bill for “Xmas,” and $42,000 in “stipends” to volunteers, including a person who lives with Riley.

If you want to help the homeless but don’t want to line the pockets of some less-than-forthright entrepreneur, try looking for local homeless organizations that you can donate time, money, or goods to. Here’s a sample list of New York City groups, but you can probably find a similar list in any large town.

“Homeless Organization Is Called a Fraud” [New York Times] (Thanks to PecanPi!)

RELATED
“Homeless, and Legit” [New York Times]
“‘JUG BAND’ KEEPS” [New York Post]
(Photo: Ed Yourdon)

Comments

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  1. bennilynn says:

    Uh-o.

    … Sorry. Couldn’t resist.

  2. hypnotik_jello says:

    Yeah, these guys are right by grove street and W4th I think by the gristede’s I think.

  3. TheBaronVanWolfe says:

    but if the money in fact DOES make it to homeless people (the table workers) does that still make it wrong?

    • FilthyHarry says:

      Lets say a given collector makes a hundred bucks in a day, probably a safe estimate on a busy tourist ridden NYC street, no? Then spends of that 100 bucks, 5 to 8 dollars on a loaf of bread and pack of american sliced cheese. Hands out 15 or so sandwiches and pockets the rest.

      The rightness or wrongness of that is debatable. However what is important is that the collectors are clearly misrepresenting themselves, their work, and how the money is spent to the people giving the money. That makes it a scam to me.

    • El-Brucio says:

      One of the reasons I rarely give money to panhandlers is because I’m fairly certain it’s just going to be used to fund their addictions. At least when I give it to an established homelessness charity I know the money is being spent reasonably well.

      There is also no guarantee that the people renting the tables are homeless either – I imagine fake charities can be quite lucrative. One Toronto area woman pandhandled for her fake charity and managed to drive a nice car and have a large home in the suburbs from the money she made.

    • humphrmi says:

      The first thing I thought of is, jeez – we complain about big charities that use double-digit percentages of collections for their own salaries, travel, and other perks. And these guys ostensibly keep a larger percentage of the take.

      But on the other hand, it’s a scam in that it legitimizes something that many people won’t donate to, panhandlers, for various legitimate reasons. I won’t argue those reasons here, but if someone prefers not to donate to panhandlers, I think that this outfit tries to trick them into doing so.

      • pecan 3.14159265 says:

        The difference, IMO, is that legitimate charities use the funds to help the people they purport to help, develop fundraising events that may bring in more donation money, and they have to pay their staff. And they don’t keep most of the money they bring in – they put it into trusts, programs, and into the hands of the people who need it. In no way should the majority of a nonprofit’s donations go to staff. The majority of the money should be going into programs to help the people they raise money for and to efforts that raise more money.

  4. FilthyHarry says:

    What I was told is that the way the setup works is like a lot of non-profit orgs. They take the money, buy a loaf of bread, a pack of cheese, hand out some sandwiches and the rest is ‘administrative overhead’ or salary for the employees (the person doing the collecting.)

  5. katia802 says:

    If you want to really help the homeless, (not just provide for the next bottle or high) contact a shelter.

  6. madog says:

    In my area it’s becoming more common for people to stand out with “Need Money for Funeral”, “Single Mom…” and other similar posters. There’s a new one each day. For starters, if you’re a single mom then who’s watching your kid(s)? Are you paying someone?

    Then there is a group of guys who stand out collecting for a firemen’s fund or something similar. One guy’s pants are crimped up so much at the foot that it looks like they were someone 6ft taller than him. Also, their arm patchs are hanging on by a piece of thread. The whole getup looks like a bad Halloween costume.

    Either way,after being scammed once when I lived in L.A. (felt bad, gave like my last $15 I would have needed for the next few days, then saw the guy pulling the same sob story in the same place the next day and called him on his bullshit and told the person he was talking to to go away), I will never again give directly to a homeless individual. There are programs and organizations out there for just the reason.

  7. jecowa says:

    How is this different from any other charity?

    • maddypilar says:

      Legitimate charities have to account for all their administrative costs and make available to the public the break-down of how the money they take in is used.

  8. Darrone says:

    Do they at least play the flute or 5 gal buckets?

  9. Hank Scorpio says:

    Next thing you know, people are going to start hooking rickshaws up to them, and giving them just the bottoms of the muffins!

  10. SG-Cleve says:

    In Cleveland an organization has set up a way to collect money to support the homeless without having to give it directly to panhandlers. They put these collection boxes (pseudo parking meters) in areas frequented by panhandlers and encourage people to put the money in the meter instead of giving it to a panhandler. It lets pedestrians feel they are doing something to help while not feeling guilty about ignoring the panhandlers.

    http://blog.cleveland.com/metro/2009/08/yellow_meters_in_downtown_clev.html

  11. masso says:

    Wow, I saw them all the time, but I don’t pay attention to them. I give money to credible charity, but I really don’t give money to people who ask on the street side.

  12. trentblase says:

    Sounds like a competitor to the Human Fund (http://en.wikipedia.org/wiki/The_Strike_%28Seinfeld%29#The_Human_Fund)

  13. Eldritch says:

    The ones on Spring Street were always the worst. Last time I went, the guy at the table was beratting all the women walking around with shopping bags, claiming if they had enough money to buy new clothes, they had enough to donate. I remember specifically him pointing to a woman who was ignoring him and going “You think you’re pretty now, huh, but you’re ugly as sin on the inside!”.

    Only time I’ve ever given money was for a broke-ass looking teen on the sidewalk with a sign that said “Family killed by ninjas, need money for karate lessons”. I laughed so hard and gave him a buck.

  14. a2bondfn says:

    Are there any situations where it would be okay to give money to a charity on the street? I figure usually the Salvation Army folks are legitimate, though it wouldn’t take much for someone to paint a bucket red and grab a bell and setup shop in some random place…

    • blueduckconsumerist says:

      Salvation army is a discriminatory organization. I’d sooner give to the UHO people.

      I do NOT see this as a fraud — unless the operators claim non-profit tax and other benefits.

    • pecan 3.14159265 says:

      AFAIK, Salvation Army bell ringers wear the Salvation Army apron and have signs. And I would think that they had to have an official partnership with the store they’re standing in front of. If Salvation Army wasn’t going to post a person in front of a specific Wal-Mart, I don’t think Wal-Mart would let a person in any old Salvation Army apron stand out there.

  15. MisteriosaNYC says:

    a few like to hang out in Union Square. i see at least 3 when im down there. i wonder how many will be there next time i head down there. i have no qualms about yelling out that its a fraud.

  16. 2 replies says:

    Got H1N1?
    Go over to the table and make a donation to the guy’s face.

    Kidding! (mostly)

  17. daveyk says:

    Wow this story is old, I haven’t lived in NYC for ten years and it was well known back then that it was a scam.

  18. Coelacanth says:

    Sounds like the organisation is sham and the “officers” and “volunteers” should be given a full audit of their books, as well as their alleged “CPA” who certified the tax documents.

    As for the grunts on the street, initially I’d be outraged, but then again, it’s no different than simply giving change to the random homeless people on the street/subway. Other beggars not affiliated with UHO are just as dubious.

  19. Tank says:

    I’m sorry, but I think this is genius.

    * Brand homelessness
    * Buy signs, tables and jugs
    * Rent them to homeless people for $15 a shift at hundreds of locations city wide
    * Proceeds go DIRECTLY to the homeless
    * Entrepreneur makes money, homeless person makes money. Everybody wins.

    Why is this bad?

    • pecan 3.14159265 says:

      Because deep down, no one wants money to go directly to the homeless because a great deal of homeless people aren’t merely “without homes” – they have mental illnesses, drug addictions, and it would be overall more beneficial to donate money to programs that help the homeless get off the streets rather than just alleviate the problem. The goal should be to get the homeless off the streets, into a home, into a stable job, rather than simply provide them with cash that they can spend on anything except for food.

    • bearda says:

      It’s bad because that $15 fee that UHO is getting is essentially profit. The owners are spending it like profit. The organization bills itself as a non-profit charity. The IRS and state tax services don’t look too kindly on that kind of thing. Real charities need to account for the money they take in and how it’s spent. These guys don’t.

    • jpdanzig says:

      As others have noted, this scheme is bad, because the implication of the UHO solicitors’ appeal, “Give to the homeless,” is that your donation will support more than one homeless person and that there will be some legitimate oversight governing the ways the money will be dispensed. Here your contribution all goes to the one guy at the table — who could spend it on rot gut for all you know — and his bosses, who apparently spend NONE of it on charitable work and ALL of it on themselves. Phooey…

  20. The Donut Pirate says:

    Eh. At least the money went somewhere.

  21. spazztastic says:

    I’m going to file this under ‘Not News’. Never give to individual panhandlers directly. I once took advantage of a McDonald’s offer of BOGO food, and decided to give the extra to the homeless & hungry signholding guy. He threw the food at me. So never again.

    • Cat_In_A_Hat says:

      Sounds like the time when my mother was leaving McDonald’s and a homeless woman asked her for money because she was hungry. My mom offered to buy her food from McDonald’s but the woman said she didn’t like McDonald’s and wanted Burger King. My mother then happily got into her car and drove far far away. :0)

    • korybing says:

      I had a friend give a big sandwich to a homeless guy with a “Homeless and Hungry” sign, and he refused it.

    • h3llc4t, breaker of office dress codes says:

      A crackhead once threw a sandwich at me. So much for being nice.

  22. pdxazn says:

    It is wrong, but it still better than those who go to Salvation Army, etc. waiting for volunteers hand out stuff to them instead of being a volunteer themselves.

    Those homeless people cycle through more new gloves & blankets than most people… they get a new ones on a cold day and throw them away next day.

  23. Coelacanth says:

    In Berkeley, I believe the homeless banded together and published their own newspaper, “Street Spirit”

    • pecan 3.14159265 says:

      DC’s homeless paper is called Street Sense. I keep wanting to pick one up, but I never have any cash.

    • Cat_In_A_Hat says:

      Not just Berkeley, those are all over the Bay Area. They used to be 25 cents and have now gone up to a dollar. Occasionally (if I’m feeling generous and trust that the homeless person selling it is really “homeless” and wanting something to eat, or if they are entertaining, the guy I pass on the way to work likes to sing jingles and call me sweetie) I will just give the person a few quarters and have them keep the newspaper.

  24. rekoil says:

    Saw one of these at 7th Ave and West 31st – right in front of the office I was working in – when I was in NYC last week. Wonder if it’s still there…?

  25. Bohemian says:

    I have seen too many street charity schemes or panhandlers making hundreds of dollars in a sitting. I just don’t give to any person or group while on the street, at my door or on the phone. If I want to donate I will go directly to that group and give them a donation.

    I had a friend in Middle School who grabbed a can and claimed he was collecting money for “Jerry’s Kids”. He was only half lying, his dad’s name was Jerry. He made about $100, nobody questioned what he was doing. We eventually sent him his own way, we couldn’t stomach watching him scam people anymore.

  26. azntg says:

    Always thought there was something screwy with these guys – until recently, I’ve always saw them in front of the Barnes and Noble on 16th Street and near the Time Warner Center in Columbus Circle.

    Glad I did not give a cent to them (nor will I ever give to any panhandler).

    Priority will always be family first, followed by close friends – as long as they aren’t chronically “down on their luck” (then I’m just becoming a de facto enabler). Then maybe my local library if I have something extra to spare.

  27. lemmiwnks says:

    Their most recent tax return is available from the Foundation Center:
    http://dynamodata.fdncenter.org/990_pdf_archive/134/134031684/134031684_200712_990EZ.pdf
    Even their IRS filing looks sketchy…

  28. leastcmplicated says:

    I once gave my umbrella to a homeless guy standing with a box of puppies in the pouring rain and he graciously took it and put it over the puppies

    • pecan 3.14159265 says:

      Could you have taken the puppies to an animal shelter and the homeless guy to a homeless shelter?

      • Coelacanth says:

        Hrmm, I wonder if they run homeless shelters anything like they do at animal shelters…

        • Coelacanth says:

          This was in response to a post by pecan…. Why didn’t it thread properly?

          Please, allow users edit and/or delete own their comments!

  29. mizmoose says:

    spazztastic that’s sad in a number of ways. I used to work with someone who was a vegetarian who loved the toys that came with fast food kids’ meals. He’d buy the meals and then offer the food to the homeless folks that camped out around our offices. Someone would always accept the food, but not always the first person asked.

  30. tbax929 says:

    The saddest part for me is that the article doesn’t surprise me in the least. It reminds me of Costanza’s Human Fund.

  31. hypochondriac says:

    I always though it looked fishy, Glad I never gave them money. One was right by the Kaplan center I studied at

    • parkj238 says:

      Agreed. I want to give to a homeless organization but honestly, all those guys manning the UHO container have looked shady to me. I’m used to seeing homeless people in NYC but some are more shady and menacing than others…

  32. jpdanzig says:

    One of the local TV news programs outed UHO some years ago. After that broadcast, I opened my mouth to one of the table guys at Union Square, denying his request for money with the comment, “UHO is bogus!” He almost came after me, he was so upset! I am glad that Cuomo has confirmed the earlier charges, and I wish the city would put these guys out of business permanently and get their tables — and their pushy solicitors — off our already overly congested streets… Of course, I also wish the city would do more for the homeless as well!

  33. Chazz1918 says:

    If you look them up on any charity rating site you will find they have been doing this for over 25 years. Better late than never. You buy a franchise from the President of the organization. He gets 15% you keep the rest. No sandwiches.

  34. clamjuice says:

    lol, this is one of those things where you just keep walking by. I can’t believe people put money in this stuff. I may have to try and panhandle a bit for some extra “change”! (wink wink)

  35. CTAUGUST says:

    Call me nuts. While I feel posing as an organization is wrong, if the person collecting is “themselves homeless and keeps whatever they collect, minus a $15 fee.” is this not a PERFECT way to give to the homeless?

    The homeless person gets more than they would by begging because it looks more professional and there is no massive organization with expenses. Their fee is $15?

    Let’s say a homeless person with a UHO bottle brings in $100 a day in NYC. Once they pay the $15 fee that means they pocked $85 or 85% of the donations to directly to “those in need”.

    Not many real charities can tell you that 85% of your money goes to the person who needs it. Sounds like UHO actually does that, even if the method is sketchy.