If you're considering donating to a United Way charity, understanding past corruption scandals can help you decide if the United Way is a good charity to support. Most charity corruption scandals, like the ones at different United Ways, were carried out by an individual or a small group of people, so they don't necessarily reflect the organization as a whole.
1992 Aramony Corruption Scandal
William Aramony served as a respected leader of the United Way of America (UWA) before resigning amid a corruption scandal in 1992. Aramony was accused of taking money from UWA, the group that oversaw thousands of local United Ways, by siphoning money to companies he helped create. Aramony was convicted on 25 felony counts related to the corruption scandal in 1995 and sentenced to seven years in prison. Two co-conspirators, Thomas Merlo and Stephen Paulachak, were also convicted of defrauding UWA. All three were found guilty of taking over $1 million from UWA. Witness testimony and evidence showed Aramony used some of this stolen money to woo and court a 17-year-old girlfriend.
2002 United Way of Washington D.C. Scandal
In 2004 Oral Suer, the former CEO of the United Way of the National Capital Area, pled guilty on charges of fraud. The lengthy investigation started in 2002 shortly after Suer's retirement. Suer admitted to defrauding the United Way of half a million dollars. He says he used some money for personal trips and bowling equipment, paid himself for leave he never took, and took more from the charity's pension plan than he was supposed to. The scandal had a direct impact on this chapter of the United Way, and their fundraising plummeted. Suer was convicted of his crimes and sentenced to serve approximately two years in jail.
2006 United Way of New York City Scandal
In 2006, after an investigation by the United Way of New York City, it was determined that former CEO, Ralph Dickerson Jr., had used approximately $230,000 in funds and assets for personal use. Dickerson spent the money during his last years at the agency in 2002 and 2003. He was accused of getting reimbursed about $40,000 for things like parking tickets and dry cleaning and using about $200,000 worth of donated points to stay in hotels for non-business related trips. Dickerson was not charged with any crimes and agreed to pay back the $227,000 that was misused.
2008 Charlotte United Way Scandal
The United Way CEO salary scandal of 2008 rocked the Charlotte, North Carolina area, and the outcry came more from the community than the agency itself. Gloria Pace King worked as CEO at the United Way of Central Carolinas for over a decade. When the community found out King had made $1.2 million in 2007 alone, the highest salary and benefits package of any United Way CEO at the time, it didn't seem right. While King was at the center of the scandal, the issue was really with the Board of Directors who had authorized all these payments. Following the scandal, King was asked to resign, but she was ultimately fired. The Board agreed to pay the rest of her employment contract, unless she got another job, but cancelled a large portion of her retirement plan.
2018 United Way of Santa Rosa County Scandal
From 2011 to 2018, United Way of Santa Rosa County Executive Director Guy Thompson embezzled over half a million dollars from the agency for personal use. Thompson had an elaborate scheme of hiding donation checks and falsifying documents that allowed him to periodically pocket cash without anyone knowing. In 2019 Thompson pled guilty on counts of wire fraud, along with tax evasion, and was ordered to pay restitution in the amount that he stole.
2019 Massachusetts United Way Scandal
One of the most costly United Way corruption scandals took place in 2019 through the United Way of Massachusetts Bay and Merrimack Valley. Vice President of Information Technology, Imran Alrai, was accused of stealing $6.7 million from 2012 to 2018. Alrai created a company and passed it off as a good vendor for the United Way to work with. He falsified documents and details about this vendor, and the money paid to the vendor ultimately went directly to him. Alrai was fired and indicted for wire fraud.
Your United Way Donations
There are about 1,800 different United Ways who all fall under one umbrella group. When you donate to the United Way, you want to understand where your United Way money goes. Most of it stays with your local United Way agency and is used for programming or administrative expenses. Percentages vary by location, but roughly 80-90% of your donation is used for programming.
Consider Corruption Carefully
Before you donate to any charity, it's smart to check out charities by looking into how your donation will be used and the reputation of the charity. Past corruption scandals shouldn't automatically deter you from supporting any charity, but they can help you better understand that charity.
