WASHINGTON - Stung by criticism it misled people making donations for Sept. 11 victims, the American Red Cross is changing the way it raises money.
The charity, in ads and fund-raising solicitations, will tell donors that their money could be used for many disasters over time instead of immediately for a specific earthquake, flood or other calamity, two people with knowledge of the plan said Tuesday. It will also put safeguards in place to ensure that donors' intent is being honored, they said.
Red Cross officials declined to comment Tuesday. The changes were to be unveiled Wednesday.
The Red Cross drew fire last fall for its Liberty Fund, set up as a special account to aid the victims of the Sept. 11 attacks at the World Trade Center and the Pentagon. Donors were upset to learn the charity planned to use tens of millions of dollars for things unrelated to the attacks, such as a blood reserve and an upgrade to the charity's telecommunications system.
Then-Red Cross Chief Executive Officer Bernadine Healy said the charity always made clear that some of the money would be used for "future critical priorities."
But critics said the charity's ads were misleading and money poured into the Liberty Fund because donors believed they were helping victims of the attacks.
The Red Cross reversed course in November and said it would donate all the money raised by the fund to those directly affected by the attacks. The controversy helped prompt Healy - who set up the special relief fund and was featured prominently in television ads seeking donations for it - to resign.
The Liberty Fund has raised $967 million and distributed $570.4 million of that, according to a quarterly report filed April 30.
"The Red Cross made a mistake, acknowledged it and has now built safeguards into its fund-raising policy to prevent these kinds of problems from occurring again," House Commerce Committee spokesman Ken Johnson said. "Obviously, from our perspective, identifying donor intent is critically important."
The Commerce Committee's oversight panel held a hearing in November attacking the Red Cross handling of Liberty Fund donations.
The Red Cross is moving away from such segregated fund raising. Its new ads and solicitations will be far more generic, officials who have seen them said.
For example, a Red Cross ad once read, "Please right now help the victims of this and other disasters by making a financial contribution to the American Red Cross disaster relief fund."
The new version would read, "You can help the victims of this disaster and countless other disasters across the country each year by making a financial gift to the American Red Cross disaster relief fund."
The charity will also put checks in place to inform each donor about its disaster relief fund; clarify the intent of the donation; confirm the donor still wants the donation to be directed to the disaster relief fund; and acknowledge the donation was directed as requested.
The Better Business Bureau's Wise Giving Alliance President H. Art Taylor called the change "a step in the right direction." After receiving complaints about the Red Cross Liberty Fund, the philanthropic watchdog group requested information from the Red Cross to see if it still met its giving guidelines.
Taylor said the Red Cross made the changes after testing reaction to its ads.
"They realized that people may not be reading their ads as clearly as they intended," Taylor said.
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