Editor’s Note: CNN’s “AC360°” explores what happened to the nearly $40 million in donations of medicines and other goods to Guatemala. Did it ever really exist? Watch the two-part series, in conjunction with the Tampa Bay Times and the Center for Investigative Reporting, on CNN’s “AC360°” beginning Monday, February 10, at 8 p.m. ET.
Story highlights
Documents uncovered by CNN show $40 million in donations to Guatemala
Yet there was no sign of these donations in the poor Central American country
"Any charity that spends even a million dollars a year would be huge," aid worker says
In a country where 20% of people live on less than a dollar a day, Richard Grinnell is doing his level best to help the impoverished people of Guatemala.
Grinnell runs an American charity here called Helps International, which arranges medical procedures done by American doctors and provides stoves to the poorest of the poor.
So when he heard that 15 small American charities that have nothing to do with foreign aid claimed to have sent $40 million worth of medicines to Guatemala in a single year, he was surprised, to say the least.
Grinnell said his charity runs 15,000 clinics throughout Guatemala at a cost of about $300,000 a year.
“Any charity that spends even a million dollars a year would be huge,” he said.
Documents obtained by CNN show that Charity Services International, a private South Carolina company, claimed to have shipped nearly $40 million in medicines and other donations on behalf of 15 small charities to Guatemala in 2010. Those same charities also reported sending another $10 million to Guatemala the next year.
According to its tax filings, one of those American charities, The Breast Cancer Society of Mesa, Arizona, claimed to have shipped $22 million of donations by itself in 2010.
But a joint investigation by CNN, the Tampa Bay Times and the Center for Investigative Reporting could find no trace of even a fraction of those donations.
CNN traveled across Guatemala to find these medicines, starting with the Order of Malta, which was listed as the biggest recipient of Charity Services International’s alleged donations.
All the American charity donations were funneled through the downtown Guatemala City office of the Order of Malta, a centuries-old charity with links to the Catholic Church that is accorded diplomatic status by some countries.
At the downtown building listed as the Order of Malta’s headquarters, a building manager said it had been five years since the Order of Malta had offices there. Inside another office building with an impressive sign saying it was the “Embassy” of the Order of Malta, an assistant said no one was inside.
About an hour’s drive outside the capital, a guard stood outside a gated iron fence with a sign for the Order of Malta. The guard said the fence surrounded a warehouse with donated medicines, but he refused to allow CNN access.
A spokesman for the Order of Malta , Enrique Hegel, later told CNN that it received two or three shipments a month in 2010 and 2011 from American charities, “depending on the season.” He would not respond to other questions.
Robert Gramajo, who signed for some of those donations in 2010 and 2011, said he never saw any dollar amounts listed for the goods he received. He also told CNN that the Order of Malta closed a clinic that had offered free mammograms for Guatemalan women in 2011 because there were no funds to continue its operation. Gramajo, who said he left the Order of Malta two years ago, now operates his own charity.
What’s this all about? Charity watchdog groups said some American charities want to impress potential donors and therefore claim huge amounts of dollar values in medicines and other goods shipped abroad to poor countries. In reality, these charities send small amounts of goods and state regulators say they inflate the values time and time again.
Roy Tidwell, CEO of Charity Services International, declined to say what precisely comprised the millions of dollars of goods sent to Guatemala, citing confidentiality for his clients. But he said in an e-mail that all the donations were valued by the charities and not by his shipping office.
That’s not so, according to a spokeswoman for the Breast Cancer Society, one of the 15 small charities that donated items to Guatemala through Charity Services International. Spokeswoman Kristina Hixson said it was Charity Services International that provided all the valuations.
Hixon also said Breast Cancer Society had “amended” some of its IRS filings to eliminate $12 million worth of claimed donations to Guatemala. In addition, she said the Breast Cancer Society had given “$36 million of medicines and supplies to those in desperate need” to other Central American countries and to West African nations.
Tampa Bay Times’ charity checker
Back in the Guatemalan countryside, Richard Grinnell said he has never even heard of the Order of Malta nor any of the American charities that claimed to have donated millions and millions of dollars’ worth of supplies.
People in rural parts of the country, he said, are so impoverished that even a few dollars a day more and free medicine would mean the world.
The huge donations claimed by these American charities, he said, just don’t happen in his world.
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