By Jonathan Stempel
(Reuters) - The Federal Trade Commission and 10 U.S. states on Monday sued what they called a "sham" charity that raised $18.25 million to help women fight cancer, but spent just $194,809 for that purpose.
According to a complaint filed in Houston federal court, telemarketers hired by Women's Cancer Fund and its founder Gregory Anderson lied to tens of thousands of prospective donors by promising their money would "help save lives," and help cash-strapped patients pay for rent, utility bills and food.
Instead, the complaint said Anderson, who was also the fund's chief executive, paid his fundraisers more than $15.55 million and himself more than $775,000, with most of the rest going to overhead.
Some donors allegedly received bogus handwritten "thank you" letters in which Anderson said he survived cancer in 1984, and assured that donations would help thousands of women cover basic living expenses.
The alleged scheme ran from 2017 to 2022 when the Harrisburg, Pennsylvania-based charity, also known as Cancer Recovery Foundation International, sought to dissolve. Monday's lawsuit seeks restitution, civil fines and other relief.
"Cancer Recovery Foundation International and Anderson abused the generosity of American donors in the most egregious way," Samuel Levine, director of the FTC's consumer protection bureau, said in a statement.Anderson, 76, of The Woodlands, Texas, could not immediately be reached for comment. No phone number is listed for his home. It is unclear whether Anderson has hired a lawyer.
California, Florida, Maryland, Massachusetts, North Carolina, Oklahoma, Oregon, Texas, Virginia and Wisconsin joined the FTC lawsuit.
Anderson has run at least nine other nonprofits and related entities that have sought donations for cancer-related causes from people around the world, the complaint said.