Do boxes represent good deed or scam?

Doubts linger about how clothing-collection funds are used; nonprofit still under scrutiny

Alameda Times-Star/February 1, 2008

Oakland - George Kwon thought he was doing his part to help less fortunate children in Africa when he agreed to let a nonprofit organization called Campus California TG place a green, metal clothing-collection box on his business property at 41st Street and Broadway.

But questions abound about the validity of Campus California TG (Teachers Group), which says it collected 3.2million pounds of donated clothing - worth about $800,000 - from 300 boxes last year.

The organization, which operates a small school in Siskiyou County that prepares people for humanitarian work in Africa and Central America, had to remove more than 30 boxes - 20 from Berkeley alone - following a "30 Minutes Bay Area" investigation that aired on KPIX-TV Channel 5 in December 2006.

The piece reported that CCTG was controlled by Tvind, a worldwide network founded in Denmark as an alternative educational movement in the 1970s, but whose founder and subsidiaries have been under investigation for fraud and corruption in Europe.

The "30 Minutes" piece said the proceeds from CCTG's clothing-collection efforts in California are funneled to Tvind's sister organizations and used to enrich the organization's leaders - with little benefit to the poor.

Karen Boyd, assistant to Oakland City Administrator Deborah Edgerly, said she is creating a team of public works, code enforcement and city attorney's office personnel to deal with the recent re-appearance of the drop-off boxes.

"We are aware these boxes are popping up again," Boyd said. "They don't have permits, so they are not authorized to operate. They don't pay business taxes and they don't have encroachment permits to be in the right of way.

"The word is getting out, this company may not be what it appears," Boyd added.

Jan Sako, 29, a manager with CCTG who is in charge of the clothing-collection operation, said the television story was misleading. He said that all proceeds from the clothing-collection operation cover operating expenses for the organization's school in Etna, as well as the clothing-collection operation in the Bay Area.

The organization does not claim to send direct aid to Africa, he said. Rather, it runs a 14-month program to train and send volunteers to Africa to help educate people about HIV/AIDS transmission and environmental issues.

Each student pays $3,800 in tuition, but it actually costs $10,500 for room and board during the six-month training period in the United States, travel to and from Africa, insurance and immunizations, Sako said.

Once in Africa, the students work for a nonprofit organization run by Humana, which was formed by the Tvind Teachers Group, and Humana pays their expenses - usually for four to six months, Sako said.

None of the recycling money goes to Humana or Tvind, nor is CCTG a subsidiary of either organization, Sako said.

According to its last Form 990 filing with the IRS in 2005, CCTG listed as its objective for 2006 to expand its clothing-collection system in the Bay Area "to consist of 300 drop-off boxes."

The organization has already exceeded that goal, Sako said, with about 350 boxes around the Bay Area and plans to place 40 more next month. There are 14 boxes in Oakland so far.

The green boxes seem to appear almost overnight, usually placed with the consent of the property owner. The bins are emptied once or more per week, Sako said.

Hamdan Al-Awdi allowed a box to be placed on the sidewalk in front of his corner market at Apgar and West streets. He said people frequently leave clothing in the box, and he often has to pick up items left on the curb after the boxes fill up.

A box in front of the Great Harvest Bread Co. on College Avenue was removed last year. Oakland Councilmember Jane Brunner's office told the company that it either needed to obtain an encroachment permit or remove it, but Sako said CCTG removed it after the bakery owner asked it to.

Kwon, owner of Precision Tune Auto Care, said he allowed CCTG to place the box on his property before Christmas because he was told that a majority of the money - as much as 80 percent - goes toward helping African children.

Kwon said he is often skeptical of other charitable organizations because he fears a large share of public donations goes to pay salaries.

"How would I feel if (that wasn't true)? How would you feel?" Kwon said. "I'm just trying to give something back to society. I think people are very skeptical. I like to look at the cup as half full. If everybody is afraid, nobody does anything."

Councilmember Pat Kernighan (Grand Lake-Chinatown), said she thought the boxes could be removed without getting too heavy-handed about it, likely by educating property owners about the background of the charity.

"Somebody ought to bring an action or file a complaint about (CCTG's) nonprofit status," she said.

Sako, who said he traveled to Mozambique as part of the CCTG program, has been in charge of the clothing-collection operation since 2006. With the exception of San Francisco, boxes have been placed in cities throughout the Bay Area. He said CCTG asks every city's planning department whether permits or licenses are required.

In many cases the consent of the property owner is enough, he said, although there are exceptions. San Rafael, for example, charges a permit fee of $1,200 to $1,500 per box, he said. Permits in Berkeley now require a public hearing, something Sako said CCTG did not want to endure.

"Our general policy is all these permits cost money," Sako said, adding that such costs cut into CCTG's only source of income. The nonprofit would rather place the bins where they are welcome and where CCTG doesn't have to pay, he said.

According to CCTG, the organization collects the clothes and takes them to its warehouse in Richmond. The garments are placed in 1,000-pound bales and sold to brokers for 25 cents a pound. Executives of one brokerage company, Garson and Shaw, are Tvind members, the "30 Minutes Bay Area" report said.

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