By Travis Loller, Associated Press
NASHVILLE, Tenn. — Two Tennessee-based cancer charities labeled “shams” by the Federal Trade Commission have settled a massive fraud case, along with their president, by agreeing to a $75.8 million judgment and the dissolution of the businesses. But the government may never see much of that money.
The complaint filed last year accused James T. Reynolds Sr. and others of spending donations meant for cancer patients on six-figure salaries and luxury vacations. The FTC said it is the largest joint action ever undertaken by the FTC and state charity regulators.
FTC attorney Tracy Thorleifson said the agency does not yet know how much money the government will recover, but she said it “won’t even be close” to the judgment, which reflects the amount of money the public donated to Cancer Fund of America and Cancer Support Services between 2008 and 2012.
According to court documents, Reynolds went on a spending spree after he was first advised of the complaint.
“Not only did he sell his house in the fall of 2014, in the months since he has run up tens of thousands of dollars of credit card debt and spent almost all his available cash. He has been on multiple cruises and traveled nationally and internationally, always paying the way for himself and companions. Cash withdrawals from his checking accounts and credit card purchases since January 2015 have exceeded $101,000, not including payments for rent, utilities, insurance, automobiles, boats, or tithes to religious institutions,” court documents state.