Today's News by Jack Nerad for Driving Today

Car Donation Charity Sued by Fundraiser

Wednesday, May 26, 2010

A professional fundraiser sued Cars 4 Causes, one of the nation's leading car donation charities, this week for allegedly failing to pay funds owed to the fundraiser and to the charities expected to benefit from the proceeds of the donated vehicles.

Cars 4 Causes hired the fundraising firm that filed the lawsuit, Charity Development LLC, in 1998 to handle the logistics of assessing, repairing, storing and selling donated vehicles.

Tim Finnigan, owner of Charity Development asserts that since 1998, his firm has returned to Cars 4 Causes a higher percentage of proceeds than any other fundraiser in the business. He claims that more than 87 percent of the gross selling price of every vehicle donated to Cars 4 Causes and sold by the fundraiser has gone to Cars 4 Causes. But after Cars 4 Causes terminated its contract with Charity Development in May, things got ugly.

Finnigan said he and his firm “have been concerned for some time about Cars 4 Causes’ high internal costs,” which, he estimates, have consistently absorbed approximately 70 percent of the funds it receives. He claimed that Cars 4 Causes currently gives less than approximately 16 percent of its gross proceeds to other charities that have been designated by donors and that the rest of the proceeds are spent on internal overhead and a few small programs it runs directly.

“It is a shame that we were forced to take this kind of drastic action against a charity that has historically done so much good for the public,” said Finnigan. “Unfortunately, our advice has fallen on deaf ears, and we’ve observed that the money from our concessions has been used not to pay charities, but has been diverted to other purposes.”

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