Changes at Mercury One: Should Donors Be Concerned?

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Nazarene sign used by Mercury One to designate the Nazarene Fund

Mercury One is a non-profit humanitarian organization founded by Glenn Beck about five years ago. The main thrusts of the organization have been education, disaster relief, veteran assistance, and humanitarian assistance to refugees. As a part of Mercury One’s mission, the Nazarene Fund was created to fund the rescue of Christians refugees from ISIS held territories. If the reports of rescues and refugees restored to safe places are accurate, Mercury One has performed a valuable service within a short period of time.

However, there have been some red flags along the way. In the past, Mercury One has reported grants of $100,000 (2013) and $104,000 (2014) to David Barton’s Wallbuilders organization. In 2014, the stated reason for the grant was “to provide help and resources to individuals affected by unforeseen disasters.” (see the 2014 990 on page 82). It isn’t clear at all what disaster relief they supplied to anyone.

Furthermore, what makes the grants of concern is that David Barton is the chair of the board of Mercury One. He oversaw the granting of $204,000 to himself via his position at Mercury One. As I have written in the past, donors who hoped their funds would go to actual disaster relief may be surprised to learn that a large sum of money didn’t go there.

Notice of Donation Allocation

Now Mercury One is changing the way they treat donations. According to a March 13 post on their website, Mercury One will no longer take restricted donations. They want donors to simply give to Mercury One without restriction on how the funds can be spent. Previously, donors could designate funds to humanitarian relief efforts, educational efforts, refugee rescue and resettlement, or for a general fund (to cover administrative expenses). While many charities prefer unrestricted gifts, the rationale given by Mercury One for the change is of concern. The new policy is below:

Mercury One stands for doing the right thing and throughout our five-year history, Mercury One has done just that. While the needs change from season to season, the constant is that Mercury One has been there to respond to those in need. We know that you, our family of supporters and donors, are vital to our mission. One of the reasons we have had so much success with our humanitarian projects and The Nazarene Fund is because people like you have trusted us to be effective and make a real difference in people’s lives. Thank you!

If you have supported Mercury One in the past, or have followed our journey through Glenn Beck, you may know that for each need, we created a separate funding campaign so that we could allocate every penny of your gift to support each specific initiative. It has been amazing to see the outpouring of passion and support for these projects, but it also prohibited Mercury One from immediately distributing funding quickly when a new and urgent need arose.

Beginning in March 2017, Mercury One is streamlining the way we receive and allocate donations. Now, all gifts will go directly to Mercury One. We want to be able to respond more swiftly, and to do this, we are consolidating future gifts to a single account so we can be more nimble and react immediately when a need arises.

Donor intent is very important to us. We have been extremely honored to be able to partner with you, our donors, to make an impact in the world, whether it be to support disaster relief, veterans, those in crisis through our grant programs, or assisting Christians and other persecuted religious minorities in the Middle East. Our mission remains constant. We will continue to support humanitarian aid and education initiatives throughout our nation and the world. What is different, is that we will no longer raise funds for single projects nor for a General Fund to support daily operations. What stays the same is that Mercury One will continue to be conservative in our administrative spending and open with our hearts as we provide assistance to those in need.

We thank you for your continued support and partnership in restoring the human spirit.

A red flag is raised by this paragraph:

If you have supported Mercury One in the past, or have followed our journey through Glenn Beck, you may know that for each need, we created a separate funding campaign so that we could allocate every penny of your gift to support each specific initiative. It has been amazing to see the outpouring of passion and support for these projects, but it also prohibited Mercury One from immediately distributing funding quickly when a new and urgent need arose.

I can’t see a reason why Mercury One would have been unable to take funds designated generally for disaster relief and use them in a crisis as needed. In fact, it appears that Mercury One has a history of responding very quickly to natural disasters (e.g. Texas, West Virginia).  While I can’t be sure, the reasoning that they have been hampered by having restricted funds doesn’t make sense to me.

The Problem with Unrestricted Giving

Restricted fund giving is a means donors have of keeping a charity accountable. To my way of thinking, charities have too few mechanisms for accountability as it is. Removing mechanisms for donors to communicate intent is a step in the wrong direction. In the last paragraph above, Mercury One claims:

We will continue to support humanitarian aid and education initiatives throughout our nation and the world. What is different, is that we will no longer raise funds for single projects nor for a General Fund to support daily operations. What stays the same is that Mercury One will continue to be conservative in our administrative spending and open with our hearts as we provide assistance to those in need.

While they pledge to continue fund humanitarian projects, the organization is not now locked into any specific level of support. Mercury One could fund one humanitarian project and put the rest into educational projects. Furthermore, they promise to be conservative in administrative spending but now there is no limit as there was before when they could only spend money given to the General Fund for admin purposes.

This change of allocation should be a red flag to donors. Two examples of other charities moving from restricted funds to one unrestricted fund come to mind: Mars Hill Church and Gospel for Asia.

In the case of Seattle’s Mars Hill Church, at one point in time, donors could donate to their general operating fund or to a mission fund (they called it the Global Fund). When I discovered that the Mars Hill Church leadership was using restricted mission funds to help build their domestic network of churches, Mars Hill decided to remove the option of designating funds just for international mission work and make all donations unrestricted. While the flexibility of the church leaders to spend money how they wanted was increased, the accountability to donors was decreased. When one gives to an unrestricted fund, one has no control over how the funds are spent. If the non-profit doesn’t make their financial statements available, donors won’t ever know how those funds are spent.

Another example of a charity which promised to honor donor intent but did not is Gospel for Asia. GFA is the target of two class action lawsuits alleging fraud. There are many examples of GFA not following donor intent, but I will mention only one of them – the $20-million gift from Believers’ Church to Gospel for Asia to build a new compound in Wills Point, TX. Those funds had originally been given by donors to go to the mission field. However, it appears that $20-million eventually came back from India to help complete construction of GFA’s Wills Point headquarters. Since these shenanigans have been reported, GFA now implies that all funds are within GFA’s discretion and control.

In practice, as these cases show, restricted fund giving doesn’t guarantee that a charity will honor donor intent. However, at least there is some basis for accountability if a charity strays from that standard.

Museum Fund?

To bring it back to Mercury One, just because Mercury One says unrestricted funds will be used for disaster relief, it doesn’t mean they will. In fact, the charity could use most of the funds for some pet project. For instance, Glenn Beck and David Barton recently have been promoting a history museum. In fact, in a recent broadcast, they described a “museum fund.” With the change in donation allocation, it is not clear that there is going to be a museum fund. In fact, I can’t find a museum fund on the Mercury One website. Watch (see especially 1:40) Beck and Barton solicit donations for a “museum fund.”

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Perhaps the left hand doesn’t know what the right hand is doing at Mercury One. In any case, the newest word as of March 13 is that all donations will be unrestricted permitting the leaders (remember David Barton is board chair) to spend the funds as they please within the broad mission of the organization. That museum could be just around the corner.

Another Red Flag

Despite the posting about a change in donation allocation, Mercury One is still advertising the Nazarene Fund. Today, donors could give to the Nazarene Fund and think their gifts would go to rescue and restore refugees. However, if the donation allocation blog post is correct, it is unclear that a donation to the Nazarene Fund would go to that purpose. I am always suspicious of a charity which markets a fund in a way that makes it seem restricted, but in another part of the website or materials says that the funds are unrestricted. Until Mercury One clarifies things more, I would be cautious and not assume that Nazarene Fund gifts will be used for rescue and restoration of refugees.