USA for Africa Is Sued Over Paper Work

The USA for Africa Foundation has been sued by the state of Connecticut for failure to file a financial disclosure statement, as required by the state’s charity reporting law.

Last week, another disclosure dispute arose between the foundation and the City of Los Angeles.

Connecticut Asst. Atty. Gen. Robert M. Langer told The Times on Thursday that the Century City-based foundation did not file a required 1985 financial audit report, despite several telephone calls and letters from his office. The final demand for the statement was mailed Sept. 12, he said.

“Members of my staff have spent several months attempting to obtain the information, and only as a last resort have we had to file suit,” Langer said. “We don’t take our responsibility lightly and we really did attempt to resolve this matter without litigation, and it’s unfortunate that it has come to this.”

$48 Million Raised

The state filed suit in Hartford Superior Court earlier this week against the charity, officially known as United Support of Artists for Africa Foundation. As of Sept. 1, the foundation had raised $48,750,000 in royalties from sales of “We Are the World” record albums, tapes and related products. Most of that money has been allocated or spent to help famine victims in northern Africa.

Connecticut is seeking to enjoin USA for Africa from further solicitations until the foundation complies with the state’s financial disclosure law.

“Consumers and the state need a complete financial picture of how much money a charity raises and how it is spent, in order to guard against fraud,” Atty. Gen. Joseph I. Lieberman said in a statement.

“While it is important to say that we have no evidence that USA for Africa has misused any contributions, neither can we determine whether the charity has used its donations properly without having a financial report,” he said.

Last week, the Los Angeles Department of Social Services rebuked the foundation for failure to file a complete statement of its expenses and receipts for last May’s Hands Across America project, a fund-raiser for homeless and hungry people in the United States.

First Statement Rejected

The city rejected a statement filed Sept. 18, because it did not show $8 million in corporate contributions. A statement filed Sept. 25 was accepted. It showed $31.8 million in contributions, including the missing $8 million. After $16.3 million in expenses, the foundation showed that it had about $15 million for distribution to the poor.

The Internal Revenue Service and California’s Office of Charitable Trusts each told The Times last week that extensions on filing 1985 disclosure statements had been granted to USA for Africa. The foundation has until Nov. 15 to file statements with both agencies.

USA for Africa spokesman Dave Fulton said that Connecticut’s charity laws are so strict that it cannot grant a similar extension.

“We did send a copy of our 1985 audit to the Connecticut attorney general’s office and they returned it,” Fulton said. “I think what they were trying to tell us was that they wanted their form, not the audit.”

1985 Figures Told

The eight-page audit report, covering USA for Africa receipts and expenses for 1985, shows that the organization earned $44.1 million and spent $8.7 million last year.

Marty Rogol, the foundation’s executive director, said that IRS Form 990, required of charitable organizations, has taken longer to prepare than he expected, in part because the foundation recently switched accounting systems. The Connecticut disclosure statement requires basically the same information as Form 990, and that will not be compiled until nearer the Nov. 15 deadline, he said.

“You can’t get blood from a stone, you know,” he said.