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Community Corner

Umbrella for Nonprofits Folds Soaking Clients

The International Humanities Center managed accounts for more than 200 local nonprofits. Their money disappeared when the parent organization suddenly closed its doors.

More than 200 nonprofit groups, from animals rights organizations to political activists, say most of their donated funds appear to have vanished after the Southland-based organization that watched over the money suddenly ceased operations last month.

The International Humanities Center closed its offices, took down its Web page and informed its clients by email that it has ceased operation, the Los Angeles Times reported in an article on its website. The center served as an umbrella organization for small nonprofit groups, handling their donations and performing administrative duties.

Directors from two of the groups told The Times that the executive director of the center told them only $10,000 was left in the accounts his organization held when there should have been $1 million. A tally of potential losses compiled by directors of 40 of the groups comes to $877,000, according to The Times.

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Several of the groups said they can no longer pay their staffs or bills, and some have explained the situation to donors on their websites, according to the newspaper.

The California attorney general's office is investigating, and directors of several groups said they had been interviewed by the office or had been asked for information, The Times reported.

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Steve Sugarman, the center's executive director, said in an email to some of the groups that he was filled with "deep regret" over going out of business and hoped it caused no lasting harm. He said all funds had been properly spent, though it is not clear what he was meant since a fiscal sponsor may not spend its clients' money on its own operations.

A consultant for the center told some of the groups their donations were used to pay legal fees and other bills, including $12,000 a month for offices in Pacific Palisades, as well as back taxes and penalties to the IRS, The Times reported.

-City News Service

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