Charity group, worker draw ministry's ire

The Ministry of Civil Affairs has taken administrative measures against the China Charities Aid Foundation for Children for violating laws and regulations and breaching public trust, according to a statement released on Tuesday.

An investigation conducted by the ministry found that a man surnamed Ke, who had previously received assistance from the foundation as a parent of a sick child, had been working at its Langfang station for the 9958 Children's Critical Illness Emergency Relief Project since November 2022.

From June to August 2023, Ke raised funds from parents of sick children via the project but allegedly kept the money for himself, defrauding them of nearly 10 million yuan ($1.4 million).

Ke was detained by police in September last year on suspicion of fraud.

The investigation revealed that the foundation also engaged in illegal activities, including operating beyond its approved business scope and failing to fulfill its information disclosure obligations.

Based on the relevant provisions of the Charity Law of the People's Republic of China and Regulations on the Management of Foundations, the ministry has imposed an administrative penalty on the foundation, suspending its activities for three months and including it on a list of untrustworthy social organizations.

The foundation's deputy secretary-general and head of the 9958 project, surnamed Wang, is suspected of committing crimes related to the posts and has been placed under investigation.

The ministry said it will continue to oversee and guide the foundation's efforts to carry out comprehensive rectification, encourage the organization to operate in accordance with laws and regulations, and comprehensively implement the newly revised Charity Law.

The ministry will also continue to improve the policies and regulations for charity organizations, strengthen the supervision and law enforcement of such organizations and related activities, and promote their healthy development.

Yao Junchang, co-founder of Beijing Weiheng Law Office, said that based on the ministry's statement, Ke's acts constituted fraud, and he will be placed under criminal investigation.

As for the foundation, "the Civil Affairs Ministry may launch new regulations on the management of charitable organizations and enhance supervision on them in the future," Yao said.

The statement about the scandal came after the ministry announced plans earlier this month to seek public feedback on a draft revision of regulations governing charitable fundraising, aiming to tighten controls and promote transparency in the sector.

The draft, released on June 5, follows the recent revision of the Charity Law and seeks to transform its provisions into practical guidelines for nonprofit organizations.

While the revised Charity Law made it easier for charity groups to apply for licenses, the draft emphasizes strong internal governance and standardized management systems for charities seeking permission for public fundraising.

Charities will be required to submit more detailed public fundraising plans, with a focus on scientific planning, reasonable design and legal compliance. The move aims to facilitate oversight by beneficiaries, the public and authorities.

Charities with fundraising licenses will be held fully responsible for all aspects of fund management, even when collaborating with fundraising partners. The draft mandates clear cooperation agreements and enhanced supervision of partner activities.

The China Charities Aid Foundation for Children was approved by the State Council, China's Cabinet, in September 2009 and was officially founded in January 2010. It's a fundraising foundation supervised by the Ministry of Civil Affairs.

According to the foundation's recent annual report, the 9958 project raised about 220 million yuan in 2022 and assisted 10,172 children nationwide with serious ailments, including leukemia, kidney disease and severe burns. The foundation had raised over 5 billion yuan by the end of 2022 and had aided over 10 million children living difficult lives.