Abramoff scandal should spur reform

By Todd Cohen

Congress needs to right a charitable marketplace that is skewed.

While they talk a lot about the need for more effective regulation and policing of charity, lawmakers have failed to enact tougher laws.

Partly to blame is the Panel on the Nonprofit Sector, a posse spearheaded by Independent Sector and funded by foundations that ambushed efforts to reform the way philanthropy is regulated.

In a massive report to the Senate Finance Committee, the panel called for tweaking current regulations while letting nonprofits police themselves on key issues like financial disclosure and ethical practice.

And the panel failed to address the critical need to require foundations to pay out a bigger share of their assets every year in grants.

A new report by Democratic investigators for the Senate Finance Committee gives lawmakers another chance to reform charitable regulation.

The report says nonprofits agreed to work on behalf of clients of convicted lobbyist Jack Abramoff in return for cash, perpetrating a fraud on taxpayers.

In addition to addressing that problem, lawmakers must overhaul regulation of a charitable marketplace that gives donors, foundations and nonprofits license to operate virtually unchecked, reaping rich public benefits in return for little public accounting.

Todd Cohen is the Editor and Publisher of the Philanthropy Journal.

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