Circling the News has been asked for months to query Larry Vein about the half million he received from FireAid. Of the $500,000 he received, he said he’s only spent 20 percent ($100,000).
Many asked why it was only this past week that CTN ran his letter explaining how he’s spending his grant. Here’s why:
What We Know:
To apply for a FireAid grant in the first two rounds, you simply had to show you were a nonprofit and answer six questions, including how the nonprofit would help, and an estimate of people served in the Fire Areas.
That meant that anyone could start a nonprofit, such as Vein did, and if one did not have a an EIN Number, one could partner with one of two larger nonprofits, the California Community Foundation or Community Partners.
On its website, Community Partners (CP) notes that once it shares a number with a “new” nonprofit, the fee is nine percent of funds from private grants (such as FireAid) and 15 percent of government grants. (Automatically that means that CP received $45,000 FireAid from Palli Strong). In return a new nonprofit can began receiving “grants immediately, operate professionally, receive expert guidance, boost credibility and insure your organization.”
Vein partnered with Community Partners – but he wasn’t the only “come-lately” nonprofit that popped up after the Palisades Fire. There were others all claiming to help fire victims.
Accountability:
Nonprofits lack accountability, other than having to file a 990. Unlike government entities, reporters can’t fill out a public records request to ask for information, there is no transparency. If one goes to the 990 reports, which are available on the internet, one generally learns that executive director makes a six-figure salary.
In addition to Pali Strong ($500,000), Community Partners also sponsored the Los Angeles Food Policy Council ($100,000) the Community Grants Program ($5M), LA Commons ($100,000) and the California Native Vote Project ($100,000). That means by partnering with these groups the nonprofit Community Partners received nine percent of the total or about $456,480.
For many nonprofits about one-fourth to one-half of the money goes to executive salaries. For example, IDEPSA (Instituto de Educatiocion Popular del Sur de California) received $100,000 in FireAid Funds. The revenue listed for 2024 was $1,768,482. Executive compensation was $111,408 and other salaries and wages were $1,233,583. That meant that almost 66 percent of the nonprofit revenue went to salaries.
The J. Paul Getty Trust (LA Arts Community Fire Relief Fund) received half million from Fire Aid, too. In 2023, the Getty Trust 990 form showed revenue of $370,248, 983 with net assets of $11,765,289,223. A trustee, president and CEO received about $4.2 million in salary. The treasurer about $2.6 million and a second person listed as a trustee, president and CEO receive about $2.5 million.
Unless FireAid (via Latham Watkins) asks FireAid grantees for specific information, such as how many people did you help and how much money was spent on each victim, there are no other sources to find that information.
FireAid lacks transparency, other than giving out amounts it handed out to nonprofits.
Regarding Vein:
One reader wrote that there were about 90 people who were removed from a What’s App thread for questioning how Vein is spending FireAid money. Initially there were about a thousand people on the App the reader said and added, “Larry refused to provide financials, so the thread got heated. Is he paying himself? I know his “board” doesn’t get paid. If he’s spent 20%, which he said, where’s it gone?”
In a May story “FIREAID Concerts Net $100 Million: Fire Victims Ask Where’s the Money?” CTN asked Tim Campbell, who managed a municipal performance audit program and conducted an audit for the L.A. Alliance for Human Rights (homeless spending), if there was a way to see the amounts that nonprofit organizations (NPO) receive.
He responded “NPO’s don’t have the reporting requirements that government agencies do, but they (FireAid) should be able to give you a breakdown of how much went to each NPO for use in the Palisades. That seems like a reasonable request, and if I were their auditor, I’d expect them to be able to produce the data.”
Campbell concluded “It would certainly be in the community’s best interest to know where donations went.” FireAid never provided information about which NPOs were specific to Pacific Palisades.
Bottom Line:
FireAid money was intended for victims, but instead went to nonprofits, a majority that perhaps only marginally were connected to the community. The States Attorney General was asked to look into it, but his emphasis is on immigration. Governor Gavin Newsom was asked to look into it, but his emphasis is on redistricting.
The L.A. Times reported that in response to the criticism, FireAid commissioned two audit reports, including an independent review led by law firm Latham & Watkins that found no evidence of fraud or misuse of funds. The reports were sent to local and federal officials and the Department of Justice.
“The law firm conducted an independent review of the charity and shared conclusive findings affirming that FireAid has acted in accordance with mission, has strong accountability measures and aid is reaching affected communities,” the FireAid organization said in a statement about the review findings at the time.
I didn’t know (and apparently many others didn’t either) how these charity fundraisers worked before these Fire Aid fiasco follow ups. If this is how they legitimately operate- fine, but the choices in who receives the grants, should absolutely be micro-targeted to help those for whom the benefit was organized for.
If one of community partners purposes is to make a big fee from each “partner”, that the partner doesn’t pay for, it only encourages questionable tactics. What an eye opener for me- having never been in the ngo realm. NGOs have an important place in our world, but like any big business, seems skullduggery is no stranger.
How do you think the 2.3 billion spent on homelessness got spent? Non profits run by people that paid themself exorbitant salaries with no accountability. Who is the queen of the nonprofits? Take a guess.!
Good article Sue. Larry should donate to the local public schools!
No audit is likely to find anything illegal because the FireAid people aren’t stupid. Legalese and wordsmithing have them covered. As far as the “spirit” of the fundraiser and the ethical characterization of the distributions, the entire endeavor is offensive.
Best job in the United States – CEO or Executive Director of a Nonprofit.
“Governor Gavin Newsom was asked to look into it, but his emphasis is on redistricting.”
Umm, no. Gavin’s “emphasis” is on positioning himself for a run for President in 2028.
Bruce,
Was it Annenberg?
Mayor Bass knows Non Profits from her days running Community Coalition in South LA long before she because a Congresswoman . She did a world of good for her community for three decades. She knows the ropes! She ruined her legacy by becoming Mayor. She should of stayed in Congress.