USA: A ‘New Era’ of Preying on the Faithful?

DOIhttps://doi.org/10.1108/eb025747
Pages405-407
Publication Date01 Feb 1996
AuthorG. Philip Rutledge
SubjectAccounting & finance
USA: A 'New Era' of Preying on the Faithful?
G.
Philip Rutledge
Journal of Financial Crime Vol. 3 No. 4 International
In May 1995, shock waves hit the world of US
institutional charities, wealthy benefactors and
educational organisations. The cause of these trem-
ors was the collapse of the Foundation for New
Era Philanthropy and its subsequent filing for pro-
tection of the United States Bankruptcy Court
wherein it listed more than $551m in liabilities and
only $80m in assets. Charities owed money by
New Era included hospitals, churches, academic
institutions and all manner of cultural, civic and
religious organisations.
New Era, located in suburban Philadelphia, PA,
was headed by John G. Bennett, Jr who appears to
have had no previous experience in the charitable
fund-raising business. According to papers filed in
the Commonwealth Courts of Pennsylvania by the
Pennsylvania Attorney General, Bennett claimed
that he had a group of anonymous donors who
wanted to make charitable contributions to certain
types of organisations anonymously so that their
names would not be placed on mailing lists nor
would they be deluged with requests from other
charities to which they did not wish to contribute.
Receipt of these anonymous gifts was condi-
tional, however, on the charity placing funds on
deposit with New Era for a fixed period of time,
usually six months. The interest on these funds,
which were to be deposited into a New Era
brokerage account and invested in certificates of
deposit or US Treasury Bills, was to be for the
benefit of New Era and pay its administrative
costs.
At the end of the deposited period, New Era
promised to return the original deposit plus a simi-
lar matching gift from an anonymous donor.
Word of this 'double your money at no risk'
opportunity spread like wildfire throughout the
world of organised giving and, as Philadelphia
Magazine observed, Mr Bennett became the best-
kept secret of the blueblood charity world. It
reported that Laurence Rockefeller had Bennett as
a houscguest and devoutly Christian billionaire
money manager John Templeton appointed him
director on the boards of his many mutual funds.
While Bennett may have been impressing the
monied and powerful, he also focused upon the
very religious. In covering Bennett and New Era,
Page 405

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