Red Cross will redirect funds for terror aid

By Diego Ibarguen

Associated Press

NEW YORK — The American Red Cross acknowledged Monday that some of the $550 million in pledged donations to a special fund established for the victims of the Sept. 11 terrorist attacks will be used for other broad-based needs instead.

"It takes a lot of money to do a lot of work. We believe very much that we are honoring donor intent," Red Cross spokesman Mitch Hibbs said. "Yes, we are helping the families, but we’re also helping everyone else."

Soon after the attacks, the Red Cross took the unusual step of creating a special account, the Liberty Fund, that was designated for terrorism relief efforts.

But at least $105 million is tapped to go to broad-based activities such as a blood reserve program, a national outreach effort, and a telecommunications upgrade.

The latest available figures — for Oct. 19 — show that $356 million has actually been collected for the Liberty Fund so far and $121.3 million spent.

Philanthropic watchdogs, while careful to note the Red Cross meets high standards overall, said the group has not clearly publicized its distribution plans for the Liberty Fund. They also questioned the need for a separate collection effort in the first place.

"I wish they hadn’t set up that separate fund," said Daniel Borochoff, president of the American Institute of Philanthropy, a watchdog group based in Bethesda, Md. By doing so, Borochoff said, the Red Cross may have created unrealistic expectations that all donations would go directly to victims of the Sept. 11 attacks.

"We’ve begun to receive inquiries from the public raising questions about the distributions of 9-11 funds," said Bennett Weiner, a spokesman for the Better Business Bureau Wise Giving Alliance, in Arlington, Va. "I think the public certainly expects the 9-11 relief organizations to follow through" by helping the victims of the attacks.

Donations to the Red Cross typically go into its Disaster Relief Fund, a general account designed to meet emergencies of all types. But soon after the Sept. 11 attacks, Red Cross President Bernadine Healy created the Liberty Fund as a special account targeted for victims of the attacks.

Disputes between Healy and members of the Red Cross board of directors over creation of the account and the uses of the money were among the issues that led to her resignation on Friday.

Of the $550 million pledged so far, Hibbs said, the Red Cross expects to spend more than $300 million over the next several months on disaster relief related to the attacks.

In particular, $100 million has been set aside for its Family Gift program, which provides victims’ families with money to help cover immediate expenses.

Another $100 million will go to disaster relief services in New York City, Washington, Pennsylvania and other sites. That includes meals, shelter, counseling, child-care and relocation assistance.