Thursday, January 7, 2010

AARP Dirty Secrets - Part 2: AARP “Kickbacks” Fund Donations to Liberal Causes

Seniors’ Advocacy Organization Gives Millions to…High Schools?
“Our focus is on issues….Here, policy trumps everything.” — Associated Press story quoting AARP Executive Vice President for Social Impact Nancy LeaMond,who in 2008 received $385,598 in salary and $36,081 in other compensation from the organization.


ARRA News Service - While AARP claims to serve as a seniors’ advocacy organization, its operations charge elderly beneficiaries above-market rates for insurance policies in order to fund entities and causes that seemingly have little to do with its stated purpose:

• A review of its financial statements finds that in 2008, AARP received $652.7 million in direct “royalties and fees” from selling products like Medigap supplemental insurance policies. Royalty revenues now comprise more than half — 60.3% — of all AARP revenues; in 2008, fully 38% of AARP’s $1.1 billion in revenue came directly from United Healthcare.

• A similar review of AARP’s most recent Form 990 filing with the Internal Revenue Service reveals that these royalty fees helped fund millions of dollars in donations to organizations whose purposes appear to stray far from AARP’s stated goal of helping seniors:
o More than $1 million to 56 school districts and high schools under the rubric of the “Ethel Percy Andrus Legacy Award;”
o $10,000 to the Center for American Progress Action Fund for a “half in ten campaign to cut poverty in half in ten years;”
o $10,000 to the Consumers Union for “general support;”
o $100,000 each to the host committees for the 2008 Republican and Democratic National Conventions;
o $1,897,159 to the AARP-controlled Legal Counsel for the Elderly;
o $200,000 to the Make it Right Foundation to “build affordable green housing;”
o $2,050,000 to WETA—the Public Broadcasting Service affiliate in Washington, DC—“to support the production and national television distribution of Washington Week with Gwen Ifill;” and
o $21,624,619 to the AARP Foundation.
While grants to schools, “affordable green housing,” and public broadcasting may be worthwhile efforts, many may question their relationship to AARP’s stated mission as a seniors advocacy organization. Moreover, a Bloomberg news analysis published in December found that seniors have been charged hundreds of dollars above market rates for AARP-branded coverage—a practice which several of the organization’s own members called “unconscionable.” Given these facts, many may question: Whom does AARP serve — its members, or its executives’ political wishes? And is AARP a seniors’ advocacy group, or a billion-dollar insurance company masquerading as a “charity” organization?

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