“Withholding financial information from the public, in other words, especially when it involves a major disaster like Hurricane Sandy, demonstrates a disturbing lack of transparency and accountability at the Red Cross.” J Benson
One of the most well-known charities in the world is being intentionally elusive about how it spent more than $300 million in donations it received following Hurricane Sandy. The independent news group ProPublica says the American Red Cross has repeatedly denied requests to disclose details about how the Sandy money was spent, claiming that this information is a protected “trade secret.”
The Red Cross is so insistent about keeping this information private that it has reportedly hired posh New York law firm Gibson Dunn to fend off anyone who might try to hold the charity responsible for its donation spending. The Red Cross did, according to ProPublica, release some information about Sandy donations to New York Attorney General Eric Schneiderman. But the charity has thus far withheld this information from the public.
“[W]e filed a public records request for the information the Red Cross provided to the attorney general’s office,” wrote Justin Elliott for ProPublica. “An attorney from the firm’s New York office appealed to the attorney general to block disclosure of some of the Sandy information, citing the state Freedom of Information Law’s trade secret exemption.”
In its defense, the Red Cross claims that disclosing this information would breach the “internal and proprietary methodology and procedures” for how it conducts its fundraising activities. Writing on behalf of the charity, Gibson Dunn’s Gabrielle Levin explained in a recent letter to the attorney general’s office that full disclosure would result in confidential financial information getting leaked, as well as other private information about how the Red Cross conducts its everyday business activities.
“[T]he American Red Cross would suffer competitive harm because its competitors would be able to mimic the American Red Cross’s business model for an increased competitive advantage,” added Levin, comparing the work of the Red Cross to a for-profit business.