www.farrahsoudani.com

The Farrah Soudani Fund website was set up by her family to raise money for a disability trust for the woman who was wounded in the Aurora, Colo. theater shooting.

In the days following the deadly shootings in Aurora, Colo., two sites soliciting donations were created for Farrah Soudani, a 22-year-old whose spleen and kidney were removed after she and dozens of others were shot in a movie theater during the midnight showing of “The Dark Knight Rises.”

The first was set up on gofundme.com by a friend of Soudani’s mother who pledged that all the money would go to Soudani. By Thursday evening, the site had raised more than $143,000.

But Soudani’s family on her dad's side worried about where that money would end up. They didn’t know this woman well, her brother Jordan Soudani said. Marty Soudani, a business owner, argued that a disability trust should be set up for his younger cousin, to protect her from creditors.

“We don’t know if that fund is going to go 100 percent to her,” Marty Soudani said. A trust would be more secure, he said; if Soudani, who does not have health insurance, went bankrupt, he said, creditors wouldn’t be able to touch the trust money, which could help to cover long-term care.

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The Soudani family, which has raised about $10,000 for the Farrah Soudani Fund, has asked those handling the gofundme.com site to transfer the donations to the trust. But so far, the family said, they have remained noncommittal. Those handling the gofundme.com site did not reply to a message from NBC News sent through the donation site.

Victoria Albright, who manages the site, responded to skeptics in an online post: “I will see that these funds are never manipulated, or land in the wrong hands. This is ALL about Farrah and her recovery. Promise!”

“We’re not saying they’re thieves,” Marty Soudani said, “but they’re not working with the family.”

Soudani isn’t alone in being wary of outsiders’ zeal to raise money.

Ken Berger — president and CEO of Charity Navigator, a non-profit charity watchdog group — told NBC’s Technolog that he advises caution.

gofundme.com

A website set up by a friend of Soudani's mother has raised more than $143,000.

"Disasters are a time when people run into a situation where they, to some degree, are flying blind because the charities they know — the ones they typically give to — may not be providing services in the area,” Berger said. “So it's a time that scammers are likely to prey on people.”

Anticipating this, Colorado Gov. John Hickenlooper encouraged people to give through GivingFirst.org, which raised nearly $2 million by Thursday. There, donors can choose a specific nonprofit – Aurora Mental Health Center or Denver Center for Crime Victims, for example – or ask that their money go wherever deemed necessary. The University of Colorado Hospital Foundation has also solicited donations for a 7/20 Victims Fund to help cover the care of those shot in the early hours of July 20.

Still, for those whose loved ones remain hospitalized, their bills soaring, raising money through sites such as PayPal or wepay.com has immediate appeal. A fund for Caleb Medley, who was in a medically induced coma while his wife gave birth to their son, Hugo, had $330,000 by Thursday evening. Medley does not have health insurance, according to the site.

The site says Medley and his wife “need help covering their medical bills (which will no doubt be in the hundreds of thousands if not millions of dollars), cost of living, baby supplies, and maybe even a college fund for Hugo! They need our help!”

But officials warn that a significant influx of cash could mean the victims are no longer eligible for certain social services, such as Medicaid, which covers long-term care for low-income people.   

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“If you give to an individual, it’s not tax deductible and it can affect the long-term security of those folks,” said Dana Rinderknecht, manager of online giving at GivingFirst.org. “They can lose some services.”

Rachel Reiter, a spokeswoman for the Colorado Department of Health Care Policy and Financing, emphasized that Medicaid is determined on a case-by-case basis but said income is one of the factors considered.

Reiter said state workers are helping families figure out if they qualify for aid, particularly if they have long-term needs. Medicaid helps to cover the medical care of families, children, pregnant women and people with disabilities -- particularly those with long-term care needs.  

“Giving through a nonprofit is strongly encouraged,” Reiter said in an e-mail. “For individuals who are disabled, excess funds may be placed in a Disability Trust and the funds would not be counted against the individual. We have staff working with the hospitals and families where this may be an option.”

Christine Handel, a Soudani family friend who helped to create the trust site, described raising money in the wake of such a tragedy as “navigating a minefield.”

“There’s no road map for this when these things happen,” Handel said. “It’s not that people have bad intentions – they don’t have knowledge. We don’t want Farrah to worry about tax season next year. She needs to go to her appointments and see her doctors and get better.”  

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AP

Award-winning “Three Cups of Tea” author Greg Mortenson has agreed to pay $1 million to a nonprofit he co-founded to settle allegations that he misspent charity money on personal items such as plane flights for family vacations and iTunes downloads, the Montana attorney general said Thursday.

In a 44-page report, Attorney General Steve Bullock said a yearlong investigation by his office concluded that Mortenson mismanaged his nonprofit, the Bozeman-Mont.-based Central Asia Institute, and personally profited from it.

“Mortenson’s pursuits are noble and his achievements are important. However, serious internal problems in the management of CAI surfaced,” Bullock said in the report.

Mortenson didn’t immediately respond to a request for comment through the Central Asia Institute. Interim director Anne Beyersdorfer told The Associated Press that the author will continue to be a paid employee, promoting CAI and building relationships overseas, but will no longer be on the board of directors.

“While we respectfully disagree with some of the analysis and conclusions in the OAG’s report, we look forward to moving ahead as an even stronger organization, focusing on CAI’s vital mission,” Beyersdorfer said in a separate statement on the CAI website.

“CAI has always been a small group of dynamic, mission-centric individuals doing extraordinary work. Mistakes were made during a rapid period of growth, and we have corrected or are in the process of correcting them.”

Mortenson became a huge name in philanthropy – and quite wealthy – after his 2006 book, “Three Cups of Tea: One Man’s Mission to Promote Peace … One School at a Time,” became a No. 1 New York Times bestseller. He followed up with another bestseller, “Stones into Schools,” in 2009.

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In “Three Cups,” Mortenson tells of how his failed 1993 attempt to climb K2, the world’s second-tallest mountain, resulted in a series of happenstance encounters that led him to establish schools for impoverished children in the remote villages of Afghanistan and Pakistan.

But his reputation as an international philanthropist and globetrotting do-gooder became tarnished after an April 2011 “60 Minutes” report in which author and fellow climber Jon Krakauer cited witness accounts that contradicted essential parts of Mortenson’s version of his experiences in South-Central Asia. The report also raised questions about the way his charity’s funds were being managed and spent.

Read the full AG's report

The report led to an investigation by the Montana attorney general’s office, which reviewed thousands of pages of documents and took sworn statements from Mortenson and others.

Bullock noted the investigation did not focus on whether Mortenson lied in his books, and it didn’t turn up evidence of conduct that could lead to criminal prosecution. Instead, it looked into CAI’s arrangements with Mortenson concerning his books and speaking engagements, as well as the financial affairs of the charity.

The probe found that the Central Asia Institute had spent about $3.96 million since 2006 to buy copies of "Three Cups of Tea," which were then distributed to libraries, schools, the military and others. Mortenson was supposed to provide a contribution to CAI equal to the amount of royalty payments he received from the book purchases, but failed to do so, investigators concluded.

The report also noted that Mortenson made hundreds of public appearances and speaking engagements to promote the book and CAI, often receiving sizable speaking fees. At the same time that the CAI was paying for his travel costs, many event sponsors were paying for similar costs. “Thus, Mortenson was ‘double dipping,’" the report said.

In one of the most damning passages, the report said:

“Mortenson, in particular, consistently failed to comply with either commonly accepted business practices or CAI’s policy manual with respect to documenting expenses charged on CAI’s accounts. The issue was repeatedly raised through the years. Board members testified that despite requests, cajoling, demands and admonitions, they were unsuccessful in getting Mortenson to submit proper documentation to support the charges he was making to the charity.

The board went so far as to provide Mortenson with a personal assistant while traveling. This, however, also failed, as the personal assistant, himself, did not adequately comply with expense reimbursement requirements, nor did he cure the problems relating to Mortenson’s expenses.

The more significant issue was not simply compliance with expense reimbursement and documentation policies, but the nature and magnitude of charges for which inadequate documentation exists. Through the years, Mortenson charged substantial personal expenses to CAI. These include expenses for such things as LL Bean clothing, iTunes, luggage, luxurious accommodations, and even vacations."

Under the settlement agreement, Mortenson must reimburse the charity more than $1 million. Nearly half has already been repaid.

Mortenson underwent surgery in June 2011 to repair a hole in his heart, and he later stepped down as executive director of the organization.

Beyersdorfer said the fallout from the investigation won't detract from the Central Asia Institute's mission of helping children in fofgotten places.

"News fatigue about Pakistan and Afghanistan is evident everywhere we look these days. But the children and their parents, village elders, and teachers with whom we work cannot look away; this is about their futures," she said in a statement. "Greg and our overseas managers have dedicated their lives to helping fulfill countless dreams and aspirations and we are honored to continue our life-changing work together."

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Facebook CEO Mark Zuckerberg unveils the company's new location services feature called "Places" during a news conference with staff at the Facebook headquarters in Palo Alto, Calif., , in August 2010.

Updated 6:50 p.m. ET: Facebook filed papers Wednesday to raise $5 billion in its initial public offering of stock. Facebook said it will apply to have its shares listed with the symbol "FB," suggesting it will be listed on the New York Stock Exchange. The IPO could be the biggest ever for an Internet company.

Original story:
What will a new generation of Facebook millionaires do with their wealth?

It’s a good bet that many will splurge on a fancy new car, purchase a new home or perhaps even plan a trip to space. But it's also likely that they’ll be giving some of it away to charity.

Experts expect charitable causes and nonprofits to be among the side beneficiaries of the minting of 1,000 or more new millionaires from Facebook’s impending initial stock offering.

“When wealth is created like that and folks are holding highly appreciating assets, it’s a great opportunity to start a philanthropic legacy,” says Rob Mitchell, CEO of Atlas of Giving, a company that tracks and forecasts charitable donations across America.

Facebook, founded in 2004, has reportedly supplemented employee salaries with stock incentives over the years. The Silicon Valley-based social media company now has more than 3,000 employees, and many of them will be able to cash in on their stock after Facebook goes public -- typically after a lockup period expires.

"With an IPO you create a liquidity event. These people in theory are just as wealthy today as they were before filing the IPO. But liquidity helps in terms of philanthropy," noted Patrick Rooney, executive director of The Center on Philanthropy at Indiana University.

He said studies have shown that entrepreneurs are about twice as generous as people who inherit their wealth, and people who are millionaires tend to give a higher share of their income and assets than those who are not.

“Will all the new thousand millionaires give? Absolutely not. But one of things we saw in 2011 was the fact that wealthy people were again interested in donating appreciated assets and specifically stock,” Mitchell said. “One of best ways to give is to give appreciated assets because you can avoid capital gains tax.”

A cue from Zuckerberg
People who track such things can’t recall ever seeing such an immediate influx of wealth in Silicon Valley -- or beyond. The closest similar scenario was when Google went public in August 2004; by some estimates more than 900 employees became instant millionaires, at least on paper.

To lessen their tax burdens, the new Facebook millionaires could contribute some of their stock to a donor-advised fund, a type of public charity that serves as an umbrella giving vehicle. They could also set up a "charitable remainder trust," whereby a chunk of money goes to a charity after a specified time – like upon death – but the donor receives income or interest off the donated assets. In both cases, the donor can avoid capital gains tax and might also be eligible for an income tax deduction.

Employees could take a cue from Facebook’s 27-year-old founder, Mark Zuckerberg, whose net worth pre-IPO has been estimated at more than $17 billion. Zuckerberg, one of the youngest billionaires in the world, has signed on to The Giving Pledge, a campaign launched by Bill Gates and Warren Buffett to get America’s superwealthy to pledge to give at least half their fortune to charity. Zuckerberg also donated $100 million to Newark, N.J., schools in 2010.

"People wait until late in their career to give back. But why wait when there is so much to be done?" Zuckerberg said at the time. "With a generation of younger folks who have thrived on the success of their companies, there is a big opportunity for many of us to give back earlier in our lifetime and see the impact of our philanthropic efforts."

Zuckerberg isn’t the only wealthy person who believes the rich should give more to charity.

PNC Wealth Management recently surveyed 555 millionaires and found 70 percent believe they bear a special responsibility in society to help the less fortunate. Sixty-four percent believe they should give substantial sums to charities to improve society.

• Related: Facebook's IPO matters to Facebook, not the market

Facebook didn’t reply to an email request for comment on this story.

Too young to give?
But Robert Frank, who writes about culture and the economy of the wealthy in his The Wealth Report blogin The Wall Street Journal, doesn’t think charities will see an immediate significant impact on charitable giving by Facebook employees.

“Many are still very young so they are still in an accumulation phase of life as opposed to a distribution/legacy phase,” Frank says. ”These are people who, for now, want to change the world through their company rather than through philanthropy.”

Frank says it’s likely that some of the accumulated stock wealth will be funneled into foundations for tax purposes. But that money won’t trickle out to actual groups or grants for many years – or even generations.

“The money will be going to mansions before you see it going to funding for villages in Africa,” he says.

But for charities that do benefit, Rooney says the trend of fewer people attending Mass or other religious services means that the newest generation of millionaires is more likely to give to secular causes than to churches and other religious organizations.

Mitchell and Frank agree that any charities that do reap Facebook dollars are likely to be more niche-focused and mission-oriented. Frank cites education and scientific research in areas such as space, alternative energy and food supply as among the causes technology-driven wealthy people are drawn to.

Indeed, one former employee told Reuters he’s is looking into booking a trip to space once he’s able to cash in on his Facebook shares.

Which is why Frank thinks there will be a “long delay” in Facebook philanthropy.

“People typically don’t start thinking about this stuff (philanthropy) until they’re in ‘50s or ‘60s,” Frank says.

Facebook employees “are going buy a lot of stuff and they’re not going to give away a lot of stuff for a long  time. Part of that is where they are in the wealth spectrum and timeline of life.”

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