ACLU blindsided by Madoff fraud

The ACLU told contributors today that two foundations that support its operations were victims of Bernard Madoff’s Ponzi scheme and have had to cease operations. “That means that $850,000 in support we were counting on from these foundations in 2009 simply won’t exist,” according to a letter sent out to donors by Alma Montclair, ACLU’s Director of Administration and Finance.

On Sunday, the New York Times reported that the Picower Foundation, ranked 71st-largest in the nation by the Council on Foundations, has joined the JEHT Foundation in being forced out of business by the Madoff scam. A number of Jewish charities, including Yashiva University, have been affected by the loss of promised grants.

Both had significant funds invested with Bernard L. Madoff, who was arrested by federal agents on December 12 and charged with running a $50 billion fraud scheme.

It may NOT be just “the economy, stupid.”

Word came to me within the past few days of a non-profit organization that is deep financial distress and has had to lay off personnel and curtail operations. News reports cite the economy.

Well, the economy is not helping this organization, but it’s not the total cause of its problems, either. Rather, much of the damage is self-inflicted.

Within the past few years, the organization has curtailed much of its fundraising operation. Two of its top people have been encouraged to leave.

This organization has really cut costs. (I’m sure the board was pleased.) But its revenue–its NET revenue, mind you–has tanked. It is its own worst enemy.

As a colleague once remarked, I am no longer surprised by how often we shoot ourselves in the foot, but rather by the glee with which we reload to shoot ourselves in the other foot.