December 29, 2003
THE BOSTON GLOBE HAS MORE in its series on inadequate financial regulation where nonprofits and foundations are concerned. This is a must-read if you're interested in this subject:
Inadequate hardly describes the system now in place to keep watch over the $429 billion in assets held by private charitable foundations. A Globe Spotlight Team investigation of hundreds of foundations nationwide found that oversight is virtually nonexistent, allowing excesses and abuses to go unchecked.
Trustees of private foundations know they can flout the law with almost no risk of detection, much less penalty. That's because the IRS has neither the resources nor the incentive to police this sector. And state regulators, including those in Massachusetts, admit that with their present budgets and staff they can do little more than warehouse the foundations' annual returns.
UPDATE: By the way, here is an earlier post with lots on this subject that you might have missed because of the holidays.