FoA goes to the IRS seeking World Week missing money

From ANIMAL PEOPLE, October 1996:

WASHINGTON D.C.––Dissatisfied with World
Animal Awareness Week organizer Peter Gerard’s September
3 statement of income and receipts, Friends of Animals is
pursuing legal action to force more complete disclosure.
At deadline several other World Week sponsors
indicated that they might join the FoA initative if Gerard
failed to promptly provide a specific list of donors and the
amounts they gave, along with an itemized list of expenditures.
Wrote FoA counsel Herman Kaufman to Gerard on
September 4, “Friends of Animals Inc., cognizant of your
failure and refusal to respond to the organizations’ requests
for a true accounting of the revenues and expenses generated
in connection with World Animal Awareness Week and the
March for Animals, has directed me to request an audit and
examination of your books by the Internal Revenue Service.”

The World Week program thanked donors for cash
gifts of at least $754,925, under seven different headings,
each representing a specific level of giving. The amounts
purportedly given at each level were stated in the literature
that Gerard’s organization, the National Alliance for
Animals, used to solicit donations.
However, Gerard’s September 3 statement, issued
after Gerard reportedly received repeated requests for a complete
accounting from at least four institutional sponsors, listed
cash contributions under only four headings, totalling just
$376,157. Only one heading, the Honor Roll, appeared on
both lists.
The $33,557 for which Gerard thanked Honor Roll
donors was plausibly close to the amount indicated by the
World Week program. But from other donor categories,
Gerard on September 3 claimed to have received just
$342,600, $382,400 less than the $725,000 received according
to the program acknowledgements.
Gerard in a July 15 letter to Kaufman attributed the
difference to receipt of donated goods and services from some
sponsors in lieu of cash. However, Gerard’s September 3
statement made no reference to either the receipt or the value
of in-kind contributions.
Gerard’s September 3 statement claimed ticket sales
revenue of $205,419, only slightly less than the $213,600 that
attendence estimates indicated. Together with the donations,
this should have given World Week resources, whether
received as cash or in kind, of upward of $950,000.
Although World Week drew only 3,000 participants,
according to the National Park Service crowd count at the
biggest event, the June 23 March, well below the 100,000
participants that promotional literature promised, ticket sales
alone should have almost covered the costs, which Gerard at
the Summit for the Animals in April estimated at $218,000,
plus unspecified amounts for advertising that the September 3
statement indicated as $13,320.
The September 3 statement, however, alleged
World Week cash expenses came to $674,339, more than
triple the April estimate. Gerard reported $79,240 as WAAW
“Gala Expense,” $55,097 as “March Expense,” and
$136,377 as “World Congress Expense,” offering no further
breakdown. The Gala, the March, and the World Congress
were the major events of World Animal Awareness Week,
but Gerard said the sum of their declared cost, $271,714,
was less than half of the total World Week outlay.
A comparision of the further expenses Gerard
claimed on September 3 with the estimates he gave the
Summit in April revealed more unexplained discrepancies:
April Sept. 3
Payroll $ 69,000 $160,641
Contracted services $ 83,000 $ 21,595
Printed materials $ 18,400 $ 43,729
Office expense $ 17,400 $ 38,995
Telephone $ 3,600 $ 12,864
Postage, shipping $ 7,200 $ 61,102
Offsetting the $62,000 overestimate of expenditures
for contracted services were unexplained expenditures in
excess of estimates amounting to approximately $207,000
Gerard informed the Summit for the Animals that
“computers, fax, copier, typewriters, printers, laptops,
phones, and general office equipment” would be donated by
the National Alliance for Animals, which he heads.
However, his September 3 statement charged $1,354.27 to
World Week budget for use of unspecified office equipment.
Alan Berger, executive director of the Animal
Protection Institute, wrote to Gerard on July 15, three weeks
after FoA’s initial demand, also seeking “a complete accounting
of the revenues and expenses,” along with explanations
“for the small turnout, lack of celebrities, ” and other disappointing
aspects of World Week. “Besides our sponsorship
amount,” Berger said, “we spent another $12,000 on travel,
products, printed materials, and advertising, in addition to
our hours of staff time. I’m sure,” he concluded, “that many
other sponsors have similar questions and concerns.”
Claimed Gerard in a nine-page July 23 response, “I
have in fact received no other letters or phone calls from
sponsors which might be viewed as critical of the event.”
As to the API expenditures, Gerard said, “That was
your decision and not mine.”