Relationship Between Charity And Supplier Raises Eyebrows

(The Wall Street Journal, 21 December 2015)

Summary: Each holiday season, the charity Wreaths Across America spends millions to decorate military gravestones at Arlington Cemetery. Wreaths Across America purchases all the decorations from a company owned by the same family that established the charity, which has raised conflict-of-interest questions about the relationship between the two organizations.

Our Thoughts: While there is nothing illegal about the close relationship between this charity and its supplier, self-dealing and other conflict-of-interest issues are not to be taken lightly. For private foundations, the laws are far more stringent than those for public charities. Foundation managers should have an advisor conduct a professional review of any transaction that has the potential to raise red flags.