April 3, 2003 | Read Time: 2 minutes
GuideStar, the online database of charity financial information, is collaborating with two organizations to develop a new subscription service designed to help foundations and corporate grant makers avoid supporting charities that are charged with illegal activity or linked to known terrorists or other wrongdoers.
The service will check charities, their chief executives, and their board members against domestic and international government records, regulatory filings, and news from major sources.
The proposed screening service has some charities concerned. Laila Al-Marayati, a board member of Kinder USA, an Islamic relief group in Dallas, says that even legitimate Muslim charities could be denied grants as a result of the screening. “I do believe some organizations will be discriminated against because of either false accusations in the media or even legal cases that have never been proven but are still in court,” says Dr. Al-Marayati, who is an obstetrician. “It creates another layer of room for discrimination.” The only thing donors really need to know, she says, is whether the charity is spending donations properly.
The screening service, called CharityGuard, will be available within the next 30 to 60 days, according to GuideStar, which is run by Philanthropic Research, a charity in Williamsburg, Va. The price of the service will vary depending on the number of charities an organization wishes to screen.
Announcement of the service follows news that a small number of charities in the United States and abroad had funneled donations to terrorist groups. Several charities have been shut down by the government because they were alleged to be supporting terrorists.
“Over the last 18 months our users have become increasingly concerned about potential misuse of donated funds and have been asking us to provide a deeper level of information about prospective grantees,” says GuideStar’s president, Robert G. Ottenhoff.
The service is designed to conform to guidelines issued by the Treasury Department on how foundations and other donors should use government-compiled lists of charities accused of wrongdoing in deciding what charities to support. Developers also relied on a report by the Council on Foreign Relations describing how to apply some of the methods used to evaluate financial institutions to determine whether domestic and overseas charities were involved in any illegal efforts.
The service is offered by GuideStar, ChoicePoint, which provides credit verification, and Regulatory DataCorp International, which was formed last year by 20 financial institutions and maintains a database of information from public sources around the world.
For more information: Go to the GuideStar Web site at http://www.guidestar.org, or contact Suzanne Coffman at GuideStar, 427 Scotland Street, Williamsburg, Va. 23185; (757) 229-4631; scoffman@guidestar.org.
