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A new charity watchdog rises

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If you're like most Americans, the time to donate to charity is now. As much as 90 percent of all donations go out in the last quarter of the year.

Wouldn't it be nice to know that your money reaches its intended recipients? Not all of it does. Some pays for a nonprofit's fundraising and administrative costs, and that's understandable.

But frustration can set in when more money goes toward those costs than to the charity's mission.

Fortunately, donors can lean on three main national charity watchdog groups to learn if their favorite nonprofit is running efficiently.

Givers may be familiar with two of the groups: the American Institute of Philanthropy ( and the Better Business Bureau's Wise Giving Alliance ( Both have provided information on hundreds of charities for years.

Now joining the ratings game: Charity Navigator (, a free, Web-based service that went online April 15 and has rated more than 1,700 charities.

Inspiration for CN came four years ago, after New Jersey businessman John Dugan learned that the donations he and his wife made to a New York charity mostly enriched those who ran the organization. "We were giving to Hale House [a charity that helps sick children], and we thought they were doing really good things, and instead we were giving to people that were misusing the money," he says. (In a plea agreement, two former executives were sentenced last month to pay restitution for stealing $776,000 from the renowned organization.)

Not to be fooled again, Dugan started CN with $1.5 million - some of the wealth he reaped when PDI, a drug-marketing company he ran, went public in 1998.

CN's goal, says executive director Trent Stamp, is to "rate every nonprofit in America that reaches out to people it doesn't know."


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