People donating used clothing to Planet Aid are told their contributions help needy people in Africa, Asia, and Latin America.
“Planet Aid sells your donated items to thrift stores and used clothing suppliers in the U.S. and worldwide,” reads the message on the bright yellow Planet Aid bins. “Planet Aid supports programs engaged in activities fighting poverty, stemming the spread of the AIDS epidemic, establishing schools, training teachers, improving food security and income generation.”
There are 1,600 Planet Aid bins in Ohio including 140 in Lorain County, according to Andrew Rice, a Planet Aid spokesman.
We found 13 in our newspapers’ circulation areas along the Rt. 58 corridor. The most visible are in front of Tuffy Tire in Amherst, Dairy Twist just outside Oberlin, and Savel’s Repair Shop on Rt. 18 in Wellington. There’s even a bin at the New Russia Township complex.
The nonprofit charity has operated in Ohio since 2001 and has 20 employees in the state. Last year it diverted about 60,000 pounds of donations from the county, Rice said
However, the group’s mission is being disputed. Planet Aid and a network of groups connected to it are accused of funneling money to the Teachers Group, an alleged Danish cult.
Group founder Mogens Amdi Peterson is an international fugitive from Denmark accused of embezzlement and tax evasion.
Group members were coerced to kickback their salaries to the group, according to Reveal, the Center for Investigative Reporting’s podcast, public radio program, and website. A May report by Reveal included a 2001 email from the FBI accusing the Teachers Group of establishing charities like Planet Aid to launder money.
“In each of these organizations, the funds are ultimately controlled by captioned subjects who divert the money for personal use,” the email said. “Little or no money goes to the charities.”
The report said the U.S. Department of Agriculture began funding Planet Aid in 2004 and continued despite warnings from Danish authorities. Last year, $31.6 million in federal taxpayer money went to Planet Aid for work in Mozambique, according to the USDA website.
The report also said DAPP Malawi, a group that Rice said is a Planet Aid subcontractor, forced Malawi workers to kickback parts of their salaries to a bank account controlled by the Teachers Group.
In response, UNICEF in July cut funding to DAPP Malawi and U.S. Rep. Betty McCollum (D-Minn.) called on the USDA Office of the Inspector General to investigate Planet Aid.
Ellen Dougherty, a USDA spokeswoman, told us the USDA’s Foreign Agricultural Service has done numerous audits and reviews of Planet Aid and visited Malawi in 2011, 2013, and 2015. She said no significant concerns were found.
“While our own oversight did not identify any major issues with Planet Aid’s implementation of the FAS-funded project in Malawi, we take these allegations of illegal activity very seriously and previously referred the matter to USDA’s Office of the Inspector General in May,” Dougherty said.
Ester Neltrup, Planet Aid president and CEO, denied the Malawi allegations on the group’s website.
She said USDA-funded programs from 2006-2013 in Malawi helped more than 800,000 people through Planet Aid’s HIV/AIDS project and more than 1,500 new teachers were trained through its food program.
Neltrup noted that the Massachusetts-based charity founded in 1997 is a 501(c)(3) nonprofit and the group’s tax records are public. She said Planet Aid has been reviewed by federal agencies.
“Money that Planet Aid receives from individual donations and from U.S. government grants are responsibly used to support international development work and our domestic recycling program,” Neltrup said. “The implementation and associated outcomes of the projects have all been in complete accordance with all agreements, and have met or exceeded expectations.”
Rice wouldn’t comment on the allegations.
He said a Planet Aid libel lawsuit filed Aug. 25 against The Center for Investigative Reporting and Reveal speaks for itself. The lawsuit accuses the California-based center, founded in 1977, of smearing Planet Aid and DAPP Malawi to get contributions for investigative reporting.
While not providing any witness statements or other evidence, it accuses the reporters on the story of impersonating U.S. Aid for International Development officials to trick Malawians into saying they were cheated.
It also said the reporters relied on false accusations from a former DAPP Malawi employee who the lawsuit said was fired for trying to divert money from farmers.
The lawsuit denied the Teachers Group is a cult, describing it as a “loose-knit organization” of former teachers dedicated to bettering the lives of its members and individuals around them. It denied any ties between group and Planet Aid or Peterson.
“None of those individuals charged with crime in Denmark — including those who were ever acquitted — have, or ever have had, any role in running or operating Planet Aid,” the lawsuit said.
In an email, Amy Pyle, the center’s editor in chief, defended the story. “We stand by our reporting, which resulted from many months of deep investigative work and is backed up by documents, recorded interviews, and photography,” she said.
The center is not the only group critical of Planet Aid.
Charity Watch, a nonprofit charity watchdog, last month gave Planet Aid an F grade for its 2015 financial filings. It said Planet Aid spent 17 percent of its expenses on programs rather than the 84 percent it claimed.
Charity Watch in a written statement said it was wrong for Planet Aid to claim that approximately $29 million spent on collecting and processing clothing and other items were a program expense. It said Planet Aid said the expense was in support of fighting climate change and that the items would’ve ended up in a landfill if they weren’t collected.
However, Charity Watch said the fact that Planet Aid admitted to raising $36 million from selling the items shows there is a market for buying and selling the used clothing and textiles that Planet Aid sells.
“It is ridiculous for this charity to assert that items worth millions of dollars would end up in a landfill if Planet Aid did not collect them,” the statement said.
Among those in the market for used clothing is Goodwill Industries of Lorain County.
Goodwill has bins in Lorain County but most donations are made at their stores including one in Oberlin and another on the Lorain/Amherst border.
Through August, Goodwill donations were down 10 percent from the same time last year, said Goodwill spokesman Kelley Singleton.
Singleton, also an Oberlin city councilman, said he can’t say whether the drop is due to competition from Planet Aid.
However, Singleton said people considering making donations should know that unlike Planet Aid, money raised from donations to Goodwill stays in the county. He said about 88 percent of the money Goodwill raised last year went for programming in the county.
Goodwill programs include providing job training for ex-convicts, holding semiannual job fairs, and providing jobs for people with mental disabilities.
Singleton said the IRS should reexamine Planet Aid’s nonprofit status given the allegations against it.
And he said people should educate themselves about charities before making donations. “Make sure they’re doing what they say they’re doing with your donation,” Singleton said.
Evan Goodenow can be reached at 440-775-1611 or @GoodenowNews on Twitter.
Photos by Evan Goodenow | Civitas Media Planet Aid has these bins on East Lorain Street in Oberlin. There are 13 in our newspapers’ coverage areas and 140 across Lorain County.