Two best friends and close philanthropic associates of actress Eva Longoria, a politically active Democratic donor, have been using non-profit organizations to generate millions of dollars in business for for-profit entities that they also own, according to an investigation by The Hollywood Reporter.
Longoria is highly active in the political world both as a high-dollar donor to the Democratic party and also as a part of the party’s outreach to Latino voters.
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She is also highly active in the Hollywood charity world, including a large role in the philanthropic efforts of her two best friends Maria Bravo and Alina Peralta. Longoria serves as the host and the honorary chair for a series of galas run by Bravo and Peralta’s Global Gift Foundation.
The Hollywood Reporter found that Bravo and Peralta have intertwined the operations of the Global Gift Foundation with their own event planning and advertising companies in a way that experts say "doesn’t pass the smell test" for accountability.
Bravo and Peralta have proclaimed to donors and the public that nearly all of the money they raise goes to a good cause, but they are quiet about how they make money through their event-production company, MandA, which the foundations hire to stage the galas, and about their for-profit limited company that sells advertising and sponsorships for the events. They assert that MandA produces events for rates that are "far below industry standard" and that the limited company manages all expenses for the events so "all donations are untouched."
While Global Gift attendees and donors might think they are participating in a purely philanthropic affair, they are providing funds to an intertwined group of entities run by the two women. Yet, operating in California, GGF must comply with California's Corporation Code section 5233, which regulates self-dealing within charities and forbids transactions of "unjustified favoritism" in cases "in which one or more of its directors has a material financial interest" and "results in a benefit" to them. […]
Charity experts agree that the structure of Bravo and Peralta's charitable enterprise raises concerns. "It's all about transparency," says Phil Buchanan, president of the Cambridge, Mass., based Center for Effective Philanthropy. "It's hard to imagine how, if these people are in these leadership roles, they are contracting with a company they run—that is the very definition of a conflict of interest."
Richard Marker, an NYU professor and co-principal of Wise Philanthropy, agrees. "People have an expectation that there will be a level of accountability," he says. "There's no question that it doesn't pass the smell test."
Experts on non-profits say that philanthropically active celebrities such as Longoria have a responsibility to do their homework on the groups it lends its name and services to.
Longoria was initially combative and dismissive when questioned by The Hollywood Reporter, saying that there was "no merit" to the investigation. As more details emerged about the unethical nature of the charity’s structure, however, Longoria changed her tune, saying that she was "glad to hear that Global Gift Gala is improving the effectiveness of its operations."