The Federal Trade Commission ordered the Cancer Fund of America Inc. and Cancer Support Services Inc. to be shut down and all assets liquidated following a 10-month suit by all 50 states and the District of Columbia. The settlement is the largest joint enforcement action ever tackled by state regulators.
The cancer charities’ leader, James Reynolds Sr., was found to have spent the majority of the two groups’ $75 million in donations on its operations, families, friends and fundraisers, instead of on cancer patients or research.
Reynolds also oversaw two other cancer charities that the FTC said were fraudulent and that settled with the government in May, when the agencies’ complaint was initially introduced. The four hoax charities collected more than $187 million from donors.
“The FTC and our state enforcement partners have ended a pernicious charity fraud that syphoned hundreds of millions of dollars away from well-meaning consumers, legitimate charities and people with cancer who needed the services the defendants falsely promised,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Today’s settlement, along with those announced earlier, shut down the sham charities once and for all and banned the individual perpetrators for life.”
Reynolds is banned from making a profit in any future charity fundraising or nonprofit work, as well as serving as any organization’s director or on its board of trustees.
