Charities, Transparency and Trade Secrets

Red Cross: How We Spent Sandy Money Is a ‘Trade Secret’ by Justin Elliott.

From the post:

Just how badly does the American Red Cross want to keep secret how it raised and spent over $300 million after Hurricane Sandy?

The charity has hired a fancy law firm to fight a public request we filed with New York state, arguing that information about its Sandy activities is a “trade secret.”

The Red Cross’ “trade secret” argument has persuaded the state to redact some material, though it’s not clear yet how much since the documents haven’t yet been released.

The documents include “internal and proprietary methodology and procedures for fundraising, confidential information about its internal operations, and confidential financial information,” wrote Gabrielle Levin of Gibson Dunn in a letter to the attorney general’s office.

If those details were disclosed, “the American Red Cross would suffer competitive harm because its competitors would be able to mimic the American Red Cross’s business model for an increased competitive advantage,” Levin wrote.

The letter doesn’t specify who the Red Cross’ “competitors” are.

I see bizarre stories on a regular basis but this is a real “man bites dog” sort of story.

See Justin’s post for the details, such as are known now. I am sure there will be follow up stories on these records.

It may just be my background but when anyone, government, charity, industry, assures me that information I can’t see is ok, that sets off multiple alarm bells.


PS: Not that I think transparency automatically leads to better government or decision making. I do know that a lack of transparency, cf. the NSA, leads to very poor decision making.

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