Ethical doubts for charity again

A media commentator is suggesting the China Charities Aid Foundation for Children (CCAFC) in 2011 transferred 18 million yuan ($2.89 million) in donations to a charity established by film star Jackie Chan just so it can collect a 10-percent administrative fee.

The whistle-blower, Zhou Xiaoyun, claimed on his Sina Weibo Monday that the CCAFC had earmarked 31 million yuan to a project aimed at finding lost and kidnapped children but transferred 18 million yuan so it could collect a "management fee."

Zhou told the Global Times that the CCAFC labeled the money transfer a "public expenditure" to the Jackie Chan Charitable Foundation Beijing.

"The more money the foundation transfers out as 'public expenditures,' the greater the 'management fee' it can earn," said Zhou, adding that charitable foundations can collect an "administrative fee" every time the money is transferred. The fee is used to pay the salaries of foundation staff, doing little to help lost children.

"I am worried that the donation will be handed from one foundation to another to fill their own pockets instead of helping those in need," said Zhou.

The Jackie Chan Charitable Foundation responded to Zhou's doubts via its Weibo account Monday afternoon saying that it used the money in a project to help sick poor children, adding that it would never transfer the donation to other foundations, nor will it pay any commission to the CCAFC.

Zhou's posting had been reposted nearly 8,000 times as of late Monday.

"The 18 million yuan was designated to rescue kidnapped children, but the transfer redirects it to aid needy children afflicted by critical diseases. This contradicts the CCAFC's work report last year that stated the money had all been spent on missing children," Zhou told the Global Times.

Zhou also claimed that according to the work report posted on CCAFC's official website, only 990,000 yuan was spent on helping find 31 kidnapped children.

Calls to the CCAFC went unanswered as of late Monday.

This new round of doubt over the CCAFC's accounting and spending practices comes after it denied accusations of money laundering earlier this month. It said its accountants made a rounding error when it reported capital flow of 4.8 billion yuan. No other explanation was provided for the huge accounting error.