False Reports about Underwriting

by Carol Spooner
May 5, 2011

Getting the Facts Right

"Getting the facts right improves our judgment of events," so I read yesterday in an article about the changing stories coming from the White House about the killing of Osama bin Laden.

You have probably heard on the KPFA News or from the anonymous writers on the internet that Pacifica station WBAI accepted underwriting or a grant or funding from Goldman Sachs.

The reports and rumors are false and are the result of not doing proper fact checking and not understanding a "donor-directed" charitable fund called
"Goldman Sachs Gives".This fund is "a public charity that maintains individual donor accounts" for partners and former partners of Goldman Sachs "from which donors can recommend grants to qualified charitable organizations."

These kinds of funds are quite common, though you probably wouldn't know about them unless you're wealthy! Wealthy donors frequently use them to make large gifts -- as I found out when fundraising for another non-profit a few years ago. They do it because this allows them to make charitable donations to the fund when they need the tax write-off and then decide later which charities to give it to, and also because such funds frequently allow them to make anonymous gifts. This saves donors from getting on peoples' major donors list and getting hit up for money repeatedly.

The important point is that money was not from Goldman Sachs, but from an individual donor who is a partner or former partner at Goldman Sachs.

I spoke with Berthold Reimers, General Manager at Pacifica station WBAI in New York City, about this a few days ago. He told me the story ... the man was listening to WBAI on his car radio one day when he heard something he thought was great. He decided he wanted to give the station some money. He did some research on the station and then made a $5,000 gift last October. Subsequently, WBAI staff member Rebecca Myles contacted him to see if he was interested in donating more money to the station. He asked if there was some project he could help to fund and she suggested a news department series on hydro-fracking. He liked the idea and donated another $10k in February.

Unfortunately, at a WBAI Local Station Board Finance Committee meeting on April 21st to review the 2nd quarter financial statements, Reimers didn't remember the details correctly when asked where the grant came from. He said it came from Merrill-Lynch. A member of the finance committee, Bob Lederer, quickly called the KPFA news department to report this "underwriting scandal," and the first erroneous story was aired on KPFA's Sunday evening news on April 24th without proper fact-checking. Subsequently, an erroneous "correction" was made ... that the money came from Goldman Sachs, again without verifying the facts. The so-called "SaveKPFA" organization is now pushing the story as an "uproar" all over the internet.

Pacifica National Board Treasurer Tracy Rosenberg did an investigation and issued a report on the salient facts on April 26th -- but still no retraction from the KPFA News Department. I've pasted her report and the documentation she provided below.

I shudder to think what this controversy will do to KPFA's and Pacifica's "major donor" fundraising efforts! Undoubtedly, most potential major donors would be reluctant to be involved in such a public "uproar." As KPFA struggles to avoid further layoffs and to regain financial solvency after several years of major losses, I don't know the motives behind these false, irresponsible and damaging stories. But it appears to be about bringing KPFA down, not saving it. And a good question is "Why?"

Quite frankly, I think this is a firing offense.

Former Pacifica Board Member (Jan 2002-Jan 2005)
Former KPFA Local Board Member (March 2000-March 2005)
Founder, Committee to Remove the Pacifica Board & Lead Plaintiff in the "Listeners' Lawsuit" (1999-2001)

Also by Carol Spooner
Do We Need Pacifica? And -- A Tale of Foxes in the Henhouse

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