Investigation: PLANET AID and its Impact on Local Charities

Posted In: News, Investigative Reporting,   From Issue 630   By: Mike Thompson

25th January, 2007     0

A trail of newspaper headlines tail Planet Aid, a Boston-based group that has set up dozens of yellow clothing collection boxes across the Saginaw area since late last year. 'Clothes service has links to fraud investigation', Lawrence (Kan.) Journal-World, April2, 2006. "Clothing drop box charity questioned', Portsmouth (Va.) Herald, Jan. 23, 2005.

'Charges prompt (attorney general) review of charity', Boston Globe, Sept. 17, 2002.

This is mostly because Planet Aid is linked with Tvind, a 37-year-old operation based in Denmark whose founding leaders face charges of fraud and embezzlement in their homeland.

If that all seems complicated, Angela Butcher had a similar reaction a few months ago. She's a volunteer with Saginaw's Action Thrift Store, 2114 N. Michigan, and says second-hand clothing donations started sinking last year as soon as the canary-colored bins started to go up.

She wants to spread the word for mid-Michigan donors to ask questions.

"My gut feeling when I first saw a yellow box last summer was that I questioned whether this is legitimate," Butcher says. "There is plenty of evidence on the Internet that it is not legitimate."

Store Manager Barb Holly says her facility is suffering as a result of Planet Aid's appearance on the scene.

"We were loaded with clothes and had half a room full that we needed to sort," Holly says. "Then those yellow boxes went up, and now we're in need."

Managers of other mid-Michigan thrift stores say they are not facing major clothing shortages and have not probed Planet Aid, although some told Review Magazine that they now would do so.

Serina Lopez, a Planet Aid public relations manager in Cleveland, says she receives ongoing media calls about the controversy, as the group expands into territory that now includes nearly 6,000 yellow boxes in 19 states.  The containers look like oversized mailboxes and are located at stores where owners give permission.

As Planet Aid moves to each new metropolitan area, often either a social worker or a journalist will do an Internet check. Boom. The result is an explosion of pro-con information.

Lopez says donors should look at Planet Aid's own American operations, established in 1997, and strongly downplays connections with Tvind.  Planet Aid's web site is www.planetaid.org and Lopez takes calls at 1-888-880-1433.

"If somebody wants to criticize us, they should at least contact us first for the facts," Lopez says. "We are a registered nonprofit and our reports are a matter of public record."

Planet Aid critics, in turn, say the links with Tvind are clear and direct. Some reports state that 100 percent of Planet Aid profits go into Tvind.

Collected and resold

Planet Aid makes no secret that it resells the clothes for profit, and that the main purpose is for international rather than local projects. Concerns in Africa and Central America range from education to clean water to AIDS prevention. "Think of the 58 million pounds of clothing that we kept out of American landfills last year, and resold at affordable prices to people in need," Lopez answers. "Think of the schools opened (in the Third World), the AIDS prevention, the billions of gallons of clean water provided."

Butcher points to a series of 2002 Boston Globe reports that have set the tone for critical follow-up articles in other communities that Planet Aid has entered. She notes that Planet Aid's own top officer was quoted acknowledging a standard of 6 percent of profits going to charity.

Lopez refutes the report and says the 6 percent figure is misleading, because revenue goes for Third World community development and improvements, rather than 'charity' for individuals.

To serve overseas, volunteers in the Tvind Network pay up to $4,000 for training and then must raise an added $7,000 apiece in their home communities. This is another point of criticism. Tvind's answer is that the volunteers receive training and experience, similar to a college education, while Lopez emphasizes that Planet Aid has "nothing to do with volunteer recruitment."

On the home front, many Planet Aid employees are low-wage drivers who circulate the bins and then make periodic collections.
Leaders of various agencies have estimated that second-hand clothing can prove strongly profitable when sold on consignment, especially where foreigners are attracted to American fashions. Tvind has a connection with an Atlanta company, Garson & Shaw Inc.

 Holly asserts that people should strive to keep donations in their home communities. "That's just a matter of opinion," Lopez says. "There's no right or wrong in that regard. The United States is full of choices."

Busy on her computer
 
Butcher defends her facts and points to an array of web sites. The most thorough discovered by Review Magazine is www.rickross.com/groups/tvind.html, because a key feature is the dozens of newspaper reports based everywhere from Boston to Chicago to Sacramento.

The focus is on Tvind but Planet Aid receives ample mention. So do other clothes collection groups with different names but also linked to Tvind. They are Gaia (green boxes instead of yellow), Humana, People to People and U.S. Again.

Among more than 70 headlines and stories, some are from the Copenhagen (Denmark) Post. One proclaims assertively,  "Clothing donors duped."

Tvind is described in various reports as a blend of for-profit and non-profit groups in a 'labyrinth' that has produced up to $860 million in assets.

Seven of eight Tvind leaders were acquitted last August on criminal charges, but the Danish government is seeking a new trial. Tvind is prohibited from non-profit efforts today in Denmark and elsewhere across Europe, and also through the United Nations.
The Sacramento Bee reported last November, "Understanding Tvind - its structure, scope and finances - has been a career-long pursuit for government investigators and journalists in Europe."

For their part, Planet Aid representatives focus on their work in the United States since 1997 and leave Tvind discussions to others. Multiple reports indeed indicate that nobody from Planet Aid ever has faced a criminal charge.

A top Planet Aid executive, Ester Neltrip, added to Lopez� words with an e-mail from her Washington office.

"Tvind is the name of a location of a school in Denmark which has been a pioneer in creating global education and international exchange," Neltrip writes.

"It is in that capacity that the paths of Planet Aid and of Tvind are meeting, purely as an exchange of people and experiences, absolutely no ownership and/or other formal obligations."

Simple messages on boxes
    
Various reports indicate that a key to Planet Aid's success is the simplicity. Residents simply can drive up and get rid of their bags, similar to putting out the trash. Action Thrift also takes donations on site, for example, but donors must honor hours of 10 a.m. to 3 p.m. weekdays or the second Saturday of each month.

The Planet Aid boxes provide only the essential information for a distant viewer. They show a group logo, which has a Saturn-style ring around Earth. The big-print come-on is basic: 'CLOTHES - SHOES'.

Up close, there's more:  'Your Donation Counts. Your Donation Helps. Help Us Handle Your Donations Correctly. Loose Clothing May Become Dirty. Put Clothing in Bags And Tie Securely. Thank You For Not Leaving Bags Outside The Box.'
Then there's a more specific blurb: 'Planet Aid is a non-profit organization dedicated to improving the lives of people in developing countries. We support community development, HIV/AIDS prevention, education and teacher training, relief aid, environmental protection and other development programs. Clothes donated to Planet Aid are resold. The proceeds are used to fund programs in Central America and Africa. Planet Aid, Inc., is exempt from taxes under IRS Code 501 � 3. For further information, please contact Planet Aid at 888-893-0643 (or) www.planetaid.org.' Review Magazine contacted a small sampling of business owners, most who said they allowed the yellow bins without in-depth questions. Some said they intend to investigate. Planet Aid's Michigan regional operation is based in Taylor.

Cameron Brady is development manager for Saginaw Habitat for Humanity, one of the community's most visible and trusted local charities since the 1980s. He also is chairman of the Saginaw County Coalition of Homeless Assistance Providers and the Saginaw County Re-Distribution Program.

Donors should ask questions not only about international and national groups, but also about local sources, says Brady, although he isn't naming names.

"There are a whole lot of different projects that keep emerging in Saginaw," Brady says. "You look down Hamilton, and it's becoming like thrift store row. You should always check, especially the newer places. Make sure your donations are used as intended. If you don't want it resold, give it someplace else."
"But at the same time, people should make an extra effort to donate. There is more stuff of value out there that we haven't even started to touch, items that people have had stashed in their attics for years. Our outlook is that if you have something good enough that you would give it to a relative or a friend who you happen to like, then you should use it yourself or donate it somewhere."

MAKE YOUR OWN CHOICES For a donor of clothes or any other item, a first key decision involves reselling. Some locations sell for slightly higher prices, such as Goodwill Industries, because a second priority is to provide jobs. Others, such as the Partnership Center (former St. Vincent de Paul), are more free with handouts.

"If a person has been in a house fire, or is coming out of prison or jail, we will give them clothes," says Director Georgann Hemker. "We have free sets that we call our C-job interview� clothes."

Ken Bueche, longtime director of Chesaning Area Emergency Relief, has an original perspective. H joins other agency leaders who say hardship seems to have increased annually since the late 1990s. He notes that his group gave out 825 large food boxes last year, up sharply from 675 in 2005.

But clothes?

"We're up to our buns in clothes," he says. "We can't get rid of them. We don't know what to do with all of them."
In fact, Bueche says he intends to speak with Angela Butcher and Barb Holly at Action Thrift.

"They can have all they want," he says. "I'll bring them into Saginaw."

Chesaning has a downtown Planet Aid box at the Dollar Store. Bueche says that has been fine with him, although he does plan to follow the suggestion from Butcher and Holly to check the group's background.

"You can only fit eight or nine large bags into one of those boxes, so I don't see where they would be such a big drain," Bueche says. "And at the rate they're going in Chesaning, they won't be here for long."

"The box is full and there are bags piled around it. Store owners and the people won't tolerate that."

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