Red Cross Calls Sandy Spending 'Trade Secret'

Won't say how it spent the $300M it raised

By Rob Quinn,  Newser Staff

Posted Jun 27, 2014 1:07 AM CDT | Updated Jun 27, 2014 7:43 AM CDT

(Newser) – The Red Cross raised more than $300 million for Superstorm Sandy disaster relief, but it is refusing to say how it raised or spent the cash. After ProPublica filed a public records request for the information, the Red Cross hired a law firm to block the release of some documents. The lawyers argued that the information is a "trade secret" and if it was disclosed, "the American Red Cross would suffer competitive harm because its competitors would be able to mimic the American Red Cross's business model for an increased competitive advantage."

The Red Cross is a public charity with a federal charter to provide disaster relief, so it's not clear who its "competitors" are, ProPublica notes. The Red Cross says it wants "proprietary information important to maintaining our ability to raise funds and fulfill our mission" to remain confidential, but the use of the "trade secret" exemption is not "something you would expect from an organization that purports to be 'transparent and accountable,'" says a spokesman for the Disaster Accountability Project watchdog group. "Donors have a right to know" what is being done with the money, writes Laura Northrup at Consumerist, "but the Red Cross refuses to even separate out how much money budgeted for certain expenses was spent during the disaster, and how much allocated for future efforts." (As of last spring, the Red Cross was still sitting on more than a third of Sandy donations.)

A man enters a Red Cross shelter at Annapolis High School in Annapolis, Md. as Hurricane Sandy approaches the East Coast, Monday, Oct. 29, 2012.
A man enters a Red Cross shelter at Annapolis High School in Annapolis, Md. as Hurricane Sandy approaches the East Coast, Monday, Oct. 29, 2012.   (AP Photo/Steve Ruark)
Galina Quacinella, right, gets some blankets for herself and her husband at a Red Cross aid station in Staten Island, New York, Sunday, Nov. 4, 2012.
Galina Quacinella, right, gets some blankets for herself and her husband at a Red Cross aid station in Staten Island, New York, Sunday, Nov. 4, 2012.   (AP Photo/Seth Wenig)
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