Child Foundation: Charity or Scam?

I find the Iranian community to be a competitive one. Unlike most other groups, Iranians don’t have as many philanthrapic organizations that do good in the world. We seem to be more focused on impressing each other, than helping each other out – something that has bothered me since I’ve been a child. There are some jewels in the mix of course and I usually like to highlight them on this blog. I did that with Child Foundation a few months ago. It’s an organization in Portland, Oregon that helps sponsor children in Iran, Afghanistan and Indonesia. It’s a great idea: to provide sponsorship to Iranian children whose parents cannot financially provide for them. If their grades are good they will be sponsored by someone in the U.S. I liked the idea so much I was even considering sponsoring a child next year.

But, unfortunately, now I’m not so sure about this organization.

(UPDATE: to read the latest update and Child Foundation’s response to this please click here or go to “Child Foundation’s Response to Fraud Allegations” on this blog).

The news (below) surfaced recently about some fraud that the founders of the organization may have been involved in:

Child-Foundation-Logo-300x231

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By Nigel Duara, Associated Press

A Texas couple and the head of an Oregon charity secretly sent millions of dollars to an Iranian bank and to a contact in Iran for nine years, violating the U.S. embargo on the Middle East country, according to a federal indictment.

The indictment describes an alleged scheme in which the Texas couple got tax exemptions for their donations to the Portland-based Child Foundation charity. The head of the charity, Mehrdad Yasrebi, allegedly funneled money that was meant for food and other assistance to his cousin and to a bank controlled by the Iranian government.

Working through Iranian corporations and banks in Switzerland and Dubai, the Texas couple and Yasrebi’s cousin masked their transfers by using food shipments and other commodities to cover financial donations intended for a sister charity in Iran run by the cousin, federal prosecutors say.

“These defendants are charged with going to extraordinary lengths to conceal the transfer of large sums of money in violation of the Iranian embargo,” Dwight Holton, the U.S. Attorney for Oregon, said in a statement Thursday.

A 26-page indictment alleges the Texas couple, Najmeh Vahid and Dr. Hossein Lahiji, conspired to defraud the government and laundered money by purporting to transfer charitable donations to Iran while actually keeping control of the money.

Also named in the indictment as a defendant is Ahmad Iranshahi, cousin of Yasrebi and the head of the sister charity started in Iran by the two men and other family members in 1999.

Yasrebi was identified as a coconspirator in the indictment but was not charged.

Federal officials allege that since Child Foundation’s creation in 1999, it has “funneled the overwhelming majority of its revenue” to the sister charity in Iran, Refah Kudak.

They also allege that as Yasrebi was sending money to Iran he was in contact with Iranshahi, 53, who lives in Iran and is considered a fugitive.

According to the indictment, Yasrebi and the Child Foundation transferred a total of $5.4 million between April 2001 and April 2005 to Refah Kudak through a bank account in Switzerland. Some of that money came from Lahiji and Vahid. The money eventually landed in Bank Melli, an arm of the Iranian government, federal prosecutors alleged.

The indictment alleges that Yasrebi organized the charity “to attract charitable donations in the United States and thereafter transfer virtually all of its revenues from the United States to Iran” through the sister charity there.

Prosecutors charge that Yasrebi sought the approval and financial support for the founding of the charity from members of Hezbollah, as well as Iranian diplomats, ayatollahs and other representatives of the Iranian government.

The indictment never explicitly states any link between the money donated and invested by Vahid and Lahiji and the terrorist group Hezbollah.

Vahid answered the phone at her home Thursday but referred all questions to the couple’s attorney, Jimmy Parks of San Antonio. Parks did not return a call seeking comment Thursday.

Calls to the Child Foundation also were not returned.

According to its most recent filings seeking to maintain charitable status, the foundation employs seven full-time employees and raised $2 million between June 1, 2009, and May 31. The foundation’s goal is to sponsor children “in the form of food, medicine, clothing and educational materials, and in some countries, housing and emergency assistance.”

The foundation serves children in Iran, Indonesia and Afghanistan.

Lahiji and Vahid are scheduled to appear in federal court in San Antonio during the week of Dec. 20. The charity is not named in the indictment, and none of its officers has been indicted.

The U.S. has had a trade embargo against Iran since 1995, the same year the Child Foundation achieved charitable nonprofit status.

11 Comments

MinaDecember 20th, 2010 at 5:47 pm

As an Iranian who live in US for last 15 years, I have sponsored 5 children in Iran via CF during last 10 years.
I have whatched my 5 sponsored kids are growing up under suport of CF and now two of them have enteres university.
I keep in touch with them, they write to me and always are thankful for the support. This is my own experience with CF and may other friends hav have the same experience also!

MahdiDecember 26th, 2010 at 12:16 pm

I have one child with Child Foundation and I donate $20 a month. Later I have learned and heard that each child has five donors for total of $100 a month, but Child Foundation gives only $20 a month. I do like to know where does the balance of $80 go. I will continue to donate but would appreciate an honest respond from the foundation.

Masoud Modarresمسعود مدرسDecember 27th, 2010 at 12:15 pm

Dear Mahdi;

Thank you for your support.

You are partially right. Our children have more than one sponsors now since average need of a child is about $100 per month.

The Child Foundation has delivered your donated money to needy children as intended – less the administrative cost of about 10% – with great obstacles imposed on us by the US government through sanctions against Iran.
Please contact us if you have any question or concerns.

Masoud Modarres

Child Foundation
Executive Manager

[…] unfortunately, as the title of my previous blog suggests “Child Foundation: Charity or Scam?“, the group was recently accused of funneling millions of dollars into Iran for personal use. […]

Hassan ShabrangJanuary 23rd, 2011 at 6:24 pm

Hello, I would like to show you the amount of money found in just Mr. lahiji home in Texas , who was an officer of the company and not a Donner as the child foundation likes everyone to believe, and like everyone else in this organization they all have either Hezbollah or Sepah background, I like you to click on the link provided and figure out how much money is there ,1footX 1foot of 100 dollar bills adds up to one million dollar , so there is about 40 million dollar ,not 1.5 as they are telling people.and this money is to be split between different terrorist groups, these people are well organized MAFIA type group, and I hope the FBI didn’t give up rounding up other higher ups in this organization in Washington, Oregon, Texas, Arizona ,California,etc. They are all living in luxury and wealth on the count of poor unsuspecting donation for children.click on this web site and on the money picture. and figure it out for yourself.

http://medicallicenseverification.com/2010/12/23/usa-south-texas-doctor-nabbed-for-secretly-passing-millions-to-iran/

larryNovember 21st, 2014 at 5:40 am

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ñýíêñ çà èíôó!…

GaryDecember 9th, 2014 at 5:14 am

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ñýíêñ çà èíôó!!…

OscarDecember 23rd, 2014 at 5:52 am

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áëàãîäàðåí….

michaelJanuary 20th, 2015 at 12:29 am

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tnx for info!…

kevinJanuary 21st, 2015 at 10:52 pm

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áëàãîäàðñòâóþ….

ArturoJanuary 21st, 2015 at 11:23 pm

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ñïàñèáî çà èíôó….

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