Foul Play in the Nonprofit Sector

"Foul Play in the Nonprofit Sector extensively documents the way that charitable organizations misuse funds entrusted to them by donors. LeClair’s message to donors is that they should set aside the good feelings they get from making charitable donations and pay attention to where the money actually goes." —Randall G. Holcombe, DeVoe Moore Professor of Economics, Florida State University, and author of Political Capitalism This book explores the causes of malfeasance in the nonprofit realm. It examines how the current inadequate regulatory environment—together with inherent “agency” problems—can lead organizations astray as they turn away from fulfilling donor wishes to instead act in their own self-interest. The book highlights the distinction between “soft corruption” in the nonprofit sector and “hard corruption.” The former includes the misuse of donor funds that do not cross the line into illegality and the latter covers explicitly illegal misappropriation of contributions. Foul Play in the Nonprofit Sector provides constructive overviews regarding charity evaluation. Economist Mark S. LeClair asks readers to consider the legitimacy of judging nonprofits on financial gains. The numbers so frequently create assumptions surrounding the worth of a nonprofit, but this is not a useful way to judge the performance of a charity. The book includes suggestions for internal sectoral changes and regulatory reforms that can deter corruption at nonprofits. Mark S. LeClair is Professor Emeritus of Economics at Fairfield University. He specializes in international and development economics and founded the master’s program in public administration. His recent research focuses on malfeasance in the nonprofit sector and the financial crisis in higher education. LeClair is the author of Philanthropy in Transition (2014).