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The Utah-based environmental group co-founded by convicted climate-change activist Tim DeChristopher is broke after losing $88,000 in the suspicious closure of a California nonprofit that was handling funds for the organization and others, according to group officials.
Peaceful Uprising had received major grants from the Threshold Foundation and New World Foundation, plus individual donations by check and credit card routed through the International Humanities Center in Los Angeles.
That center stopped making timely payments on invoices for organizing expenses in November, Peaceful Uprising national organizer Henia Belalia said, and has been unresponsive since a confusing January email from executive director Steve Sugarman stating the center was shutting down.
"He used very vague language," she said Tuesday, "and when he told us there was no money, he never accounted for it or said where the money was."
An email address and cell phone number for Sugarman were not functioning Tuesday, and the center's website was offline. The California Attorney General's Office would not confirm that it is investigating, though groups that lost money confirmed an investigator for the office's charity division has interviewed them and collected documents.
Sharon Simone, whose California-based nonprofit Headwaters Productions lost $4,000 from a scholarship fund, said Sugarman told her earlier this winter that his center had $10,000 in the bank and probably $1 million in liabilities to the hundreds of small groups that circulate their funds through it. Because the center was charging 10 percent to process donations, she said, it legally could not touch more than $100,000 of that $1 million.
"That's all they get to have," she said, "and that's not what happened."
The International Humanities Center functioned as an umbrella nonprofit, or "fiscal sponsor," for smaller groups not equipped to process donations and not registered for tax-exempt status on their own. Peaceful Uprising paid the 10 percent fee, Belalia said, but the rest was supposed to be reimbursed whenever the group submitted receipts for advocacy work.
Peaceful Uprising started using the center a year ago. Reimbursed expenses since then have included travel and other costs associated with rallies around DeChristopher's Salt Lake City trial and sentencing, and for rallies in Washington, D.C., against tar sands mining and a proposed pipeline from Canada to Texas refineries.
DeChristopher was convicted last March for falsely bidding on oil and gas leases at a December 2008 Bureau of Land Management auction. In July, a federal judge sentenced him to two years in prison.
In a Jan. 16 email provided by Peaceful Uprising, Sugarman announced "with deep sadness" his center's closure.
"We can all be very proud of the wonderful work we have done together," he wrote.
He explained that the organization had responded to "explosive growth" before the nation's 2008 financial crisis by adding staff and enlarging office space. Then the economy crashed, he wrote, and anticipated grant funding disappeared.
None of that should have mattered if the center wasn't dipping into the charities' funds beyond its allowed administrative take, Simone said. After the money disappeared, she said, she learned of a substantial Internal Revenue Service lien against the center.
Sugarman acknowledged the negative effects of a continuing IRS audit, but wrote that it had cost staff time and legal fees not cash flow.
Peaceful Uprising's Threshold Foundation grant helped sustain DeChristopher as he awaited trial, and Belalia said the group was able to spend much of it before reimbursements became sketchy last fall.
Now, Peaceful Uprising says it has been "financially wiped out."
Belalia said the group has turned to Moab-based Living Rivers as its fiscal sponsor.
Living Rivers conservation director John Weisheit said he started processing donations last month and already has seen $10,000. At that pace, he recommends that Peaceful Uprising file for its own 501(c)(3) nonprofit status and handle its own books, though that can take a year or more to achieve.
Living Rivers sends the processing work to its Moab accountant and charges 5 percent for it, Weisheit said.
The loss of funds likely will force Peaceful Uprising to concentrate its efforts on fewer causes than it might otherwise have taken on during the next six months, Belalia said. Among the campaigns that it intends to pursue is take on Rio Tinto's Bingham Canyon copper mine over air, water and land pollution.
Peaceful Uprising has tapped Moab-based Living Rivers as its new fiscal sponsor. Donation instructions are available at http://www.peacefuluprising.org.