Nonprofit Abuse – The Data That’s Hiding in Plain Sight

Improving state oversight of nonprofits is just one way that accessible, computer-friendly data could make governance better.

One area where open data has the potential to make a real difference — and where some of its current limitations are all too apparent — is in state-level regulation of nonprofits. In May, a task force comprising the Federal Trade Commission together with 58 agencies from all 50 states and the District of Columbia filed a lawsuit against the Cancer Fund group of nonprofits and the individuals who run them. The complaint alleges that the groups are sham charities that spend "the overwhelming majority of donated funds supporting the Individual Defendants, their families and friends, and their fundraisers." State officials spotted telltale signs of abuse and fraud by studying information the organizations had submitted in their federal nonprofit tax returns and state-by-state registration forms.

by Beth Simone Noveck

Full Story: http://www.governing.com/columns/smart-mgmt/col-open-data-state-regulation-nonprofits-charities.html