[News] Oilers Charity scam?

[Calgary14]

Surprised the groups that receive this funding aren't audited annually

[442scotty]

And at what point is a charity not a charity in CRAs eyes.

[TrentCrimmIndependent]

They deserve to absolutely capsize for at least a decade and get nothing for McDavid, who decisively lands on "no term"

Fraudulent, corner cutting, thug employing scum!

[Strange Brew]

Originally Posted by heep223

The Flames went through something similar with the flames foundation 5 years ago. Accounting for operating costs in foundations actually can legitimately be looked at a number of different ways, and can be spun to make the entity look better or worse.

https://www.cbc.ca/news/canada/calga...ence-1.4887824

The flames situation, including holding assets and investments on their balance sheet, is very very common and one of the benefits of being a foundation. So that part of the report is dumb. This watchdog organization could look at every registered foundation in Canada and make similar claims - the capital grows tax free and creates more sustainability in distributing out 5% to charities. It’s a strategic decision of the board, whether to spend down the capital and have less in the future or spend less and have more sustainability.

Very different than the oilers situation though, paying earnings to a related private entity definitely seems “fraudy”. This would / should come out from their auditor though, if it was audited it’s very likely legit

I have been critical of the effectiveness of the Flames foundation but IMO it is very important to distinguish those criticisms with what is happening with the Oilers foundation.

The flames foundation is ineffective at getting the money into the community so they own nearly $15 million of GIC's. Their expenses are relatively low and they aren't paying millions of dollars to any kind of related party. It just seems they are not trying very hard to make a difference in the community. The hoarding of cash has gotten worse since that article came out several years ago.

What is happening with the Oilers foundation requires a whole lot more explanation. Why the hell is $25+ million a year being paid to a company owned by the Oilers owner and how does it benefit the mission of the "charity"?

The Flames foundation also posts financial statements on their website (reviewed, not audited). Not the Oilers.

[Icon]

I don't understand how this isn't already national news...

[browna]

As mentioned in the other thread, follow the money. You don’t think some of this flowed through to Mike Smith to retire or Kane to schedule a couple concurrent surgeries?

Imagine if the money thread goes to any entities the McDavid has some interest in, as further incentive not to have left earlier than he will next season.

So this came out a few days ago. No comment yet from the Oilers?

[Strange Brew]

Originally Posted by taxbuster

I wrote about this some time back. The funds derived from 50/50 draws are NOT regarded as “Charity” funds … they are non-receipted fundraising. No different than any other charity these funds do NOT have to be spent in any particular manner other than being within the bounds of their operating license from AGLC.

Accordingly the Board can determine exactly how said funds are to be used. Charity law, on the other hand for TAX-RECEIPTED donations MUST be used in accordance with requirements of the Income Tax Act.

Odious? Certainly.
Maddening? Sure.
Legal? Quite.

The fact that they “position” some of the donations as “their” charity in no way diminishes any of the above. It didn’t start from them, but by purchasing a lottery ticket…it becomes “theirs” to use (per AGLC).

(Summarized, not detailed explanation.)

I am sure we can all agree that 50/50 tickets are not charitable donations. I mentioned this in the other thread, but these foundations get very little of their funding from donations.

The Oilers no doubt seek lots of PR for their Foundation efforts and I'm sure it was front and center in their arena negotiations. Literally channeling money from the foundation to a company owned by the owner is not a grey area when it comes to ethics unless they can show the money was used in furtherance of the Foundation's objectives. Which apparently is as follows:

In pursuit of making our communities better, creating opportunity and access, the EOCF is focused on the following:

Growing the game of hockey for boys and girls in Oil Country at the grassroots level,
Focusing on the needs of Edmonton's Downtown Community by engaging with organizations who are focused on delivering programs aimed at those most vulnerable in our community, and
Stepping up in times of community need and crisis to ensure EOCF is being a good community citizen.

I am not a lawyer but the EOCF is a registered charity and I believe there are laws which preclude a charity from spending money for the personal benefit of a related party.

[heep223]

Originally Posted by Strange Brew

I have been critical of the effectiveness of the Flames foundation but IMO it is very important to distinguish those criticisms with what is happening with the Oilers foundation.

The flames foundation is ineffective at getting the money into the community so they own nearly $15 million of GIC's. Their expenses are relatively low and they aren't paying millions of dollars to any kind of related party. It just seems they are not trying very hard to make a difference in the community. The hoarding of cash has gotten worse since that article came out several years ago.

What is happening with the Oilers foundation requires a whole lot more explanation. Why the hell is $25+ million a year being paid to a company owned by the Oilers owner and how does it benefit the mission of the "charity"?

The Flames foundation also posts financial statements on their website (reviewed, not audited). Not the Oilers.

I agree with you entirely, was kind of the point of my post. The only thing I would say is that tons of foundations only distribute 5% of their assets to charities (which is the prescriptive minimum). Because they want to keep a base of capital to ensure that they can support their charities on a long term basis. It might be a strategic board decision. Without knowing the flames foundation’s own fundraising efforts and long term plan, it’s impossible to throw shade at them for maintaining capital on their balance sheet imo

[Strange Brew]

Originally Posted by browna

As mentioned in the other thread, follow the money. You don’t think some of this flowed through to Mike Smith to retire or Kane to schedule a couple concurrent surgeries?

Imagine if the money thread goes to any entities the McDavid has some interest in, as further incentive not to have left earlier than he will next season.

So this came out a few days ago. No comment yet from the Oilers?

They did respond:

https://www.nhl.com/oilers/eocf/about-us

They are essentially claiming that the expenses paid to the related party are legitimate and reflect how gigantic their 50/50 operation is.

IMO there is some legitimacy to that. But there is a whole lot of real estate between needing to incur more costs and $25 million. Especially when it is paid to a related party.

The Flames foundation raised over $6 million last year and had about $500K in expenses. Less than 10%.

The Oilers are paying 25% of their fundraising to this related party on top of their other expenses. That sure sounds fishy without some more detail.

[PepsiFree]

Originally Posted by heep223

I agree with you entirely, was kind of the point of my post. The only thing I would say is that tons of foundations only distribute 5% of their assets to charities (which is the prescriptive minimum). Because they want to keep a base of capital to ensure that they can support their charities on a long term basis. It might be a strategic board decision. Without knowing the flames foundation’s own fundraising efforts and long term plan, it’s impossible to throw shade at them for maintaining capital on their balance sheet imo

That is indeed why they maintain capital, as it allows them to make longer term commitments to programs, and those programs can turn around and plan ahead knowing that commitment will be funded. I believe the level it’s maintained at allows them to fund commitments for 3ish years (in the event that their funding dries up entirely).

Saying it’s evidence that they are ineffective or “aren’t trying very hard to make a difference” is a bit of an ignorant and ultimately silly statement to make.

[Strange Brew]

Originally Posted by heep223

I agree with you entirely, was kind of the point of my post. The only thing I would say is that tons of foundations only distribute 5% of their assets to charities (which is the prescriptive minimum). Because they want to keep a base of capital to ensure that they can support their charities on a long term basis. It might be a strategic board decision. Without knowing the flames foundation’s own fundraising efforts and long term plan, it’s impossible to throw shade at them for maintaining capital on their balance sheet imo

I hear you. There are too many charities that hoard cash frankly, look at the endowment that a place like Harvard has.

But honestly, $15 million in GIC's seems kind of ridiculous for the Flames foundation and if they had a longer term vision to spend that money, you'd think they would share it. My sense is that they don't actively seek uses of their funds and simply rely on the grant application process.

[TrentCrimmIndependent]

Originally Posted by Icon

I don't understand how this isn't already national news...

At this point I think Katz could ritually sacrifice a homeless man in front of a crowd of fans to summon good fortune in their next cup run and it would be water under the bridge a day or two later.

For some reason people around the game just don't care about all the shady #### they do and openly admit to.

[heep223]

Originally Posted by Strange Brew

I hear you. There are too many charities that hoard cash frankly, look at the endowment that a place like Harvard has.

But honestly, $15 million in GIC's seems kind of ridiculous for the Flames foundation and if they had a longer term vision to spend that money, you'd think they would share it. My sense is that they don't actively seek uses of their funds and simply rely on the grant application process.

You might be right. But also, that capital might be earmarked for 20 charities that they have 5 year commitments to. We don’t know which is why I don’t think we can just use that as an example of how they’re mismanaging, in of itself.

Go look up a list of private foundations in Canada, and their AUM (assets under management). It’s all public.

[Strange Brew]

Originally Posted by PepsiFree

That is indeed why they maintain capital, as it allows them to make longer term commitments to programs, and those programs can turn around and plan ahead knowing that commitment will be funded. I believe the level it’s maintained at allows them to fund commitments for 3ish years (in the event that their funding dries up entirely).

Saying it’s evidence that they are ineffective or “aren’t trying very hard to make a difference” is a bit of an ignorant and ultimately silly statement to make.

LOL

In the other thread you claimed that the Flames foundation got 15% of their funding from the CSEC? I asked for your source on that.

We can disagree without using terms like ignorant. I stand by my belief that the Flames foundation is a relatively ineffective charity and hoards more money than it should. It has pledged very little of their cash reserves to date, so they are not "funding 3is years of commitments".

At least one independent watchdog group would agree with me and that was when their cash reserves were half of what they are today. It doesn't mean there is fraud.

[Strange Brew]

Originally Posted by heep223

You might be right. But also, that capital might be earmarked for 20 charities that they have 5 year commitments to. We don’t know which is why I don’t think we can just use that as an example of how they’re mismanaging, in of itself.

Go look up a list of private foundations in Canada, and their AUM (assets under management). It’s all public.

The Flames Foundation list all their commitments. We don't need to guess.

I am aware of the size of reserves that many foundations and charities have in place. It is not without controversy and it is something discussed constantly at the NFP with which I am involved.

[heep223]

Originally Posted by Strange Brew

The Flames Foundation list all their commitments. We don't need to guess.

I am aware of the size of reserves that many foundations and charities have in place. It is not without controversy and it is something discussed constantly at the NFP with which I am involved.

There is a TON of mismanagement, grey area and outright fraud in the “non profit” space. Way more than people realize. Don’t get me started on youth soccer clubs lol

Your issue is with the CRA IMO. They say you can donate into a foundation, get the tax deduction, and that foundation only has to donate 5% of its assets every year to maintain its status.

[Strange Brew]

Originally Posted by heep223

There is a TON of mismanagement, grey area and outright fraud in the “non profit” space. Way more than people realize. Don’t get me started on youth soccer clubs lol

Your issue is with the CRA IMO. They say you can donate into a foundation, get the tax deduction, and that foundation only has to donate 5% of its assets every year to maintain its status.

Sure that threshold is low but I also hope the Foundation isn’t focused on doing the minimum to maintain exempt status.

I like that the Flames foundation publishes their financials so that interested parties can express their views. If enough people care, maybe they end up giving more to organizations that can actually use it.

[heep223]

Originally Posted by Strange Brew

Sure that threshold is low but I also hope the Foundation isn’t focused on doing the minimum to maintain exempt status.

I like that the Flames foundation publishes their financials so that interested parties can express their views. If enough people care, maybe they end up giving more to organizations that can actually use it.

I’m not saying I disagree. But then they will run out faster.

[Strange Brew]

Originally Posted by heep223

I’m not saying I disagree. But then they will run out faster.

Run out? I’m just suggesting they don’t need to keep stockpiling as much since there is no shortage of need in the community. And I would say that about a number of charities.

But at least they are not funneling it back to the hockey club owners!

[topfiverecords]

Wasn’t there also suspicion around who some of the big 50/50 winners were a few years back?