November 28, 2010 | Read Time: 3 minutes
Foster Friess, who earned a fortune as a mutual-fund manager, and his wife, Lynn, use a complicated structure for their philanthropy, and it is difficult to tell from public documents exactly how much they are giving away and to which charities.
The couple gives through personal funds, the Lynn and Foster Friess Family Foundation, the Community Foundation of Jackson Hole, and the National Christian Foundation. “We shift back and forth according to what makes the bureaucracy flow the best,” Mr. Friess says.
Mr. Friess says the couple’s donor-advised fund at the Community Foundation of Jackson Hole has been “depleted to basically zero in the past nine years,” from a starting balance of roughly $26-million.
The Friess Foundation held assets of $113-million as of April 2009, the latest year for which data are available. Tax returns show that from 2007 to 2009, more than 99 percent of the $20.1-million awarded by the Friess Foundation went to the National Christian Foundation, one of the nation’s largest providers of donor-advised funds. Mr. Friess says the National Christian Foundation provides valuable research on charities and handles bookkeeping functions that would otherwise require a larger staff at the family foundation.
Mr. Friess also says he is comforted that his family and the National Christian Foundation share many of the same values.
“We don’t have to worry about what some of the other founders of major foundations have had to suffer as they’re rolling in their graves seeing how their basic missions have been perverted,” he says.
But Aaron Dorfman, executive director of the National Committee for Responsive Philanthropy a foundation watchdog group, says the transfer of assets from the Friess Foundation to the National Christian Foundation could theoretically be a way around federal rules that require private foundations to distribute more than 5 percent of their assets each year.
The funds from the Friess Foundation could be transferred to the donor-advised fund at the National Christian Foundation and simply sit there.
“It’s certainly possible that they aren’t actually getting the money into groups doing good work in communities,” Mr. Dorfman says.
Both Mr. Friess and David Wills, president of the National Christian Foundation, say the Friesses’ fund at the National Christian Foundation is being distributed aggressively. Mr. Friess hasn’t calculated exactly how grants distributed from the fund at the National Christian Foundation correspond to the valuation of the Friess Foundation. “My guess is it’s probably well over the 5 percent number,” he says.
Beneficiaries Unclear
Mr. Dorfman also points out that it’s impossible to know exactly what Mr. Friess is supporting through the National Christian Foundation, since the foundation reports its grants without linking them to specific donor-advised funds, including the fund established by Foster and Lynn Friess.
“We really don’t have any idea who the ultimate beneficiaries are,” Mr. Dorfman says.
Mr. Wills says that any interest Mr. Friess may have in giving anonymously is motivated by his Christian faith, rather than a desire to conceal anything.
“Giving anonymously is a thing that’s favored among Christians, so that you’re not trying to get something back—recognition or accolades—for what you give,” Mr. Wills says. “You’re doing it for spiritual reasons.”
Mr. Friess seems baffled by all the fuss. “Who really cares what we give money to in the first place?” he asks. “Why is that of any interest to anyone?”
