In this April 4, 2010, file photo, Los Angeles Clippers owner Donald Sterling sits court side during the NBA basketball game between the New York Knicks and the Los Angeles Clippers.
Danny Moloshok/AP

Sterling scandal puts NAACP fundraising history under scrutiny

Updated

The revelation that the Los Angeles chapter of the NAACP had taken money from and planned to honor LA Clippers owner Donald Sterling, who was banned for life from the National Basketball Association Tuesday after a recording of him making racist remarks was leaked to the press, has made this an uncomfortable week for America’s oldest and most distinguished civil rights organization.

Sterling had often touted his philanthropy despite the fact that his foundation, with a budget of about $350,000 according to tax records, comprised a small part of his $1.9 billion fortune. Tax filings showed one $5000 contribution to the LA NAACP.  

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The LA chapter had planned to present Sterling with a lifetime achievement award before the racist comments surfaced. The group granted him a similar honor 2009. Sterling has faced two lawsuits for housing discrimination, one of which ended with a nearly $3 million settlement with the federal government. Sterling also fought off an employment discrimination lawsuit from former NBA star and Clippers executive Elgin Baylor.

Given Sterling’s past record of alleged systemic discrimination against minorities – not just coarse speech – some have questioned why the NAACP accepted his money in the first place.

“People can relate to individual racism much easier than structural racism, which affects black people the most, said Peniel Joseph, a history professor at Tufts University and author of a recently released biography of civil rights activist Stokely Carmichael. “It shows you the desperation of civil rights organizations in a lot of ways – it’s very hard to raise money.”

Before Leon Jenkins, the head of the NAACP’s Los Angeles chapter, was forced to resign in the aftermath of revelations he’d been disbarred for taking bribes as a judge, he promised to give back the money Sterling had donated.

“The revelation that Mr. Sterling may have made comments in a phone conversation that was reminiscent of the ugly time in American history that contained elements of segregation and racial discrimination demands that the Los Angeles NAACP intention to honor Mr. Sterling for lifetime body of work must be withdrawn and the donation that he’s given to the Los Angeles NAACP will be returned.” Jenkins said Monday. He also describing Sterling’s contributions as an “insignificant” amount of money.

Granting someone a lifetime achievement award is different from simply accepting a contribution. But Sterling is hardly the only wealthy donor who has been accused of discrimination and who has contributed money to the NAACP.

“I think it’s important for the NAACP in LA and elsewhere and other similar types of organizations to realize what’s at risk in a system when we are now, almost all of us turning towards uber-wealthy people to fund things which do have the result of cleansing them of the appearance of bad behavior, or give them a pass,” says Maxim Thorne, a professor of philanthropy at Yale University and a former NAACP senior vice president.

As a non-profit, the group’s donations aren’t disclosed, but the sponsors of its yearly NAACP Image Awards, a star-studded event celebrating “the outstanding achievements and performances of people of color in the arts” are public. In the past five years, sponsors of the Image Awards have included companies like Wells Fargo, Bank of America, Wal-Mart and FedEx, all of whom have been sued for discrimination – in some cases by the NAACP itself.

The Justice Department’s civil rights division secured a nearly $200 million settlement with Wells Fargo in in 2012 over accusations the bank steered minorities into subprime loans – a lawsuit filed by the city of Baltimore alleged that loan officers referred to subprime loans as “ghetto loans” and black borrowers as “mud people.” The NAACP dropped its lawsuit against Wells Fargo – an NAACP contributor at the time the lawsuit was filed – in 2011, after the bank agreed to help establish the NAACP Financial Freedom Center, whose mission is to “educate and empower consumers and provide tools for effective advocacy.” 

The Justice Department also secured the largest settlement in the division’s history with Bank of America, $335 million, over similar accusations that its Countrywide unit discriminated against minority borrowers.

Wells Fargo began sponsoring the Image Awards in 2010, and Bank of America has sponsored the Image Awards since 2008. Both banks, the NAACP announced, agreed to the organization’s “responsible lending principles.” 

FedEx, which has sponsored the Image Awards since 2008, agreed in 2012 to pay a $3 million dollar settlement over accusations that they discriminated against job applicants on the basis of race and gender. 

The NAACP also backed Betty Dukes, whose class action sex-discrimination lawsuit against Wal-Mart went all the way to the Supreme Court, where in 2011 the conservative majority severely restricted the ability of workers to sue for discrimination as a class.  Wal-Mart was a sponsor of last year’s Image Awards, and has supported the NAACP’s work on helping the formerly incarcerated reenter society

The companies in these cases all continue to deny any wrongdoing. But so did Donald Sterling.

The NAACP hasn’t changed its position on civil rights or labor laws as a result of accepting contributions from businesses with questionable records on those issues – though it did come under fire for its support of AT&T’s merger with T-Mobile.  Former NAACP president Benjamin Jealous, who left the organization late last year, said the NAACP has been up front with its corporate donors about the NAACP’s intentions to pursue policies corporate supporters were opposed to such as the Employee Free Choice Act, which would have made it easier for workers to unionize. In some cases, Jealous says, corporate donors like Target walked away. 

“When I was there, it didn’t matter how much money you gave us we sued you, supported efforts to unionize you, and we pushed you to stop unfairly excluding formerly incarcerated people from your workforce,” said Jealous. “That’s much more risk and accountability than any national organization you will find from anyone who has a social mission that takes corporate dollars.”

Sill, these conflicts highlight the increasing difficulty of running a civil rights organization in an age where the still significant social and institutional obstacles facing black Americans have shifted from the days of the Jim Crow South, and where growing inequality leads to an increased reliance on wealthy donors whose generosity may have ulterior motives.

In the early days, the NAACP’s tough battles against lynching, segregation, and discrimination by the federal government galvanized the black community and sustained the organization before wealthy whites and foundations took notice of the group’s victories and decided to contribute. The NAACP still draws a significant amount of its funding from dues, but days when it didn’t need corporate help are long gone. 

“It does highlight the challenge of people who do good work and want to do good work, raising the resources to do it, and how people who believe in the mission of the NAACP, are forced to, or in this case have, taken money from a problematic individual,” says Thorne. “If we’re committed, and we believe in the credibility of the NAACP, then we should be supporting it so that they don’t have to turn to problematic sources.”

Thorne said that while there are no “written guidelines” for dealing with contributions from “sources that are not aligned with the NAACP’s mission,” there are sources the NAACP simply won’t take money from – such as the government, which the NAACP has spent most of its existence fighting. The local branches, however, are autonomous from the main organization and have to conduct their own fundraising. That’s partly how the LA chapter ended up honoring Sterling.

Shortly after Jenkins’ resignation from the LA chapter, the national NAACP said it was developing guidelines for bestowing awards. But like other charitable organizations, the group will continue to rely at least in part on contributions from companies and individuals who, like Sterling, are looking for more than just to help a good cause.

Donald Sterling, Fundraising, LA Clippers, NAACP and Sports

Sterling scandal puts NAACP fundraising history under scrutiny

Updated