While the philanthropic response to Hurricane Katrina can be compared to the support provided following the tragedy of September 11, 2001, Americans must be made aware of possible fraud and scandals in charities. As the largest recipient of donations following 9/11, American Red Cross failed to act in a manner that was considered timely and responsible to its donor?s, and the agency suffered a great loss of trust. This backlash is still being felt today as demonstrated in a scathing September 7, 2005 report from Calcutta, India which blasts its government for donating $5,000,000 to help the victims of Hurricane Katrina. The article outlines how American Red Cross actually used $109, 000,000 from 9/11 donations to improve its own telecommunication systems!

Interestingly, as Americans scramble to help the victims of Hurricane Katrina, most donated funds are surprisingly being directed back towards Red Cross. It is believed that Red Cross offers a ?brand name? which very few nonprofit organizations can duplicate. Regardless, the mission of the Red Cross as written on its website is as follows: ?The American Red Cross, a humanitarian organization led by volunteers, guided by its Congressional Charter and the Fundamental Principles of the International Red Cross Movement, will provide relief to victims of disasters and help people prevent, prepare for, and respond to emergencies.? Clearly absent from this long term plan is a statement supporting rebuilding efforts in devastated areas. While ?emergency? relief for victims is crucial, funding is greatly needed by other charitable sectors. These include agencies that assist victims in finding new employment and housing. While the Red Cross indicated that it would distribute funding to other agencies (once donations are no longer needed by them), the organization has extremely high administrative and other ?non-operational? expenses. This includes a 2004 Executive annual salary of $651,957.00!

In order to safeguard disaster victims, Americans must begin to funnel donations to other sources. Unfortunately, unless this begins to happen immediately, America is doomed to face post-9-11 nonprofit scandals over and over again. Websites such as Guidestar.org can help potential donors negotiate the available options so that they can identify which charities will be the most beneficial to its recipients. In response to the disaster, New York?s Attorney General, Elliot Spitzer issued a brochure ?Tips on Charitable Giving? which outlines ways in which prospective donors can protect themselves from being victimized by unscrupulous charities. Some points mentioned in the brochure include asking solicitor?s to provide identification and a stern warning not to give contributions in cash. This advice is sound and should be taken seriously despite the fact that FEMA (The Federal Emergency Management Agency) released a statement on August 29, 2005 specifically asking people to make cash contributions! FEMA`s request is just one more reason why donor`s need to do a little "legwork" in order to maximize the return of their contribution.