Barely a year into his tenure as head of the local American Red Cross chapter, CEO Bill Earley is facing allegations he agreed to swap private donor information for personal gain.

The claims are made in a wrongful termination lawsuit lodged in federal court in April by Joy Chesbrough, hired last year as the chief development officer of the American Red Cross of San Diego/Imperial Counties. She was let go Jan. 5 after only four months on the job.

In the suit, Chesbrough claims Earley retaliated against her for voicing objections to his actions, which she says violate American Red Cross policy and state and federal laws.

“Plaintiff walked into a culture of mismanagement and unethical practices,” according to the lawsuit. “It came to Plaintiff’s attention that sharing donor information externally was previously practiced by, and acceptable to, the Red Cross-SD. When Plaintiff refused to participate in this conduct and sought to put an end to it, she was faced with retaliation and ultimately the wrongful termination of her employment.”


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Both local and national American Red Cross officials declined to comment on the reason for Chesbrough’s departure, but deny any wrongdoing or privacy breaches occurred.

“Her allegations are untrue. The Red Cross cannot perform its mission without the generosity of our donors and their personal information is not shared,” a statement released by both offices says.

Earley, a longtime labor attorney hired by the Red Cross last July, declined a request for an interview.

Photo via American Red Cross of San Diego/Imperial Counties Flickr feed
Photo via American Red Cross of San Diego/Imperial Counties Flickr feed
Local Red Cross CEO Bill Earley, left, with SDPD Chief Shelley Zimmerman

Chesbrough claims that on two occasions Earley agreed to release confidential donor information: Once promising his former law firm McKenna Long & Aldridge an 800-plus attendee list for the Red Cross’ hallmark Real Heroes charity event after sponsoring a table. Another time, she said Earley planned to hand over information about the region’s top 15 donors to a real estate consulting firm, McKinney Advisory Group, in exchange for hosting a small fundraiser “so McKinney could obtain leads for potential new clients.”

“Despite the donors’ Constitutional right to privacy, Defendant’s privacy policy, the industry standards, and other laws and safeguards against disclosing such information, due to his relationship with McKinney, Earley had no objection to providing this information,” the lawsuit states. Earley is also accused of planning to unlawfully “send mailings to the Red Cross’ financial donors on behalf of these special interest organizations” namely his former law firm.

According to Chesbrough, the American Red Cross database contains donor names, addresses, phone numbers, emails, wealth data, as well as information about spouses, children, prior gifts and donor leadership roles on other boards, although she’s unsure how many details were going to be given or whether they ever were released.

San Diego's Red Cross chapter is locked in a legal battle with multiple layers.

“She was concerned about the gracious people of San Diego and not wanting their personal information shared to third parties,” said Chesbrough’s attorney, Alreen Haeggquist. “She intercepted and stopped Bill Earley from disclosing the information, but she’s not sure if it was released after she left.”

The local Red Cross chapter has faced major turnover of its top leaders and can’t seem to shake controversy. It has been scrutinized multiple times in recent years over various decisions and missteps, including the handling of money donated for an Alpine fire in 2001.

Earley was hired to lead the beleaguered organization last summer, mere months after the previous CEO,  Tony Young, abruptly resigned. Young said at the time his departure just 14 months into his tenure was driven by a difference of opinion with national American Red Cross leaders, not performance. Three board members left their posts days later.

Young, who had stepped down from his post as San Diego City Council president to take the Red Cross job, said the local chapter operates more as a franchise than an independent group.

“It’s more of an organization where you raise money, and the money doesn’t go straight to San Diego. It goes other places,” Young said. He said donor information was never wrongfully released on his watch.

It’s more of an organization where you raise money, and (it) doesn’t go straight to SD. -Former Red Cross CEO Tony Young

Chesbrough isn’t the first local American Red Cross official to allege wrongful termination.

Former CEO Dodie Rotherham unsuccessfully sought $2 million in a wrongful termination lawsuit against the local chapter and national American Red Cross in 2002. Rotherham and the entire San Diego Red Cross board were removed from their posts by national organization leaders after facing intense criticism over the minimal donation money spent helping victims of a 2001 fire in Alpine. Concern mounted when it was discovered that audit results were misrepresented and toned down by local officials.

In the wake of that shakeup, the organization hired an ethics expert and set up a corruption hotline while it struggled to regain the trust of the community.

When Earley was hired, he told U-T San Diego his primary goal was to get more San Diegans prepared for wildfires and other disasters.

An inaugural Disaster Preparedness Academy offered July 29 attended by nearly 100 business owners and employees is just one sign Earley is doing his job, board chairman Stan Hartman said in a statement.

“Bill Earley is a tremendous leader and we’re proud of the work he has done in a short time with the Red Cross in San Diego. We look forward to continued growth under his leadership,” said Hartman.

Hartman, who declined to discuss Chesbrough’s allegations, also cited a No. 1 national survey ranking in client and volunteer satisfaction, and progress made installing 1,000 smoke alarms as part of the American Red Cross Home Fire Preparedness Campaign.

But Chesbrough says in the lawsuit that Earley’s leadership is hurting the organization. The longtime charity worker and graduate of USD’s Institute for Nonprofit Education and Research was recruited by the Red Cross from the nonprofit World Vision International. Chesbrough’s resume also includes senior posts at nonprofits PetSmart Charities and MAP International.

“Earley started yelling at Plaintiff and speaking to Plaintiff as if she were a dog. Earley demanded Plaintiff to ‘sit!’” repeating it several times while pointing to a chair, the lawsuit asserts.

She also claims she was lied to about the organization’s finances and was made staffing promises during her interviews that weren’t kept, hampering fundraising efforts, a primary part of her job. Shortly after her start date she learned the organization was $600,000 in the red, an amount totaling 16 percent of the budget. Layoffs followed.

Four months of mail was also discovered at the Post Office, containing substantial donations, “Hence, none of the donated money was being allocated in accordance with the donor’s intentions” and donors weren’t receiving receipts as required by the IRS and Red Cross policy, the lawsuit states.

Though the alleged wrongdoing occurred in San Diego, the case is being heard in federal court because the American Red Cross headquarters is in Washington, D.C. and “the amount in controversy exceeds $75,000, excluding interest and costs.”

Court records show a mandatory settlement conference is scheduled for next May ahead of trial.

    This article relates to: Must Reads, News, Nonprofits/Community

    Written by Ashly McGlone

    Ashly is an investigative reporter for Voice of San Diego. She can be reached at ashly.mcglone@voiceofsandiego.org or 619.550.5669.

    6 comments
    barb graham
    barb graham subscriber

    Any time large sums of money pool up, the grifters follow. It seems that big-name charities like the Red Cross and United Way have been taken over by incompetent, greedy people.


    Of course, without donations, they wouldn't even exist, so if we don't like their performance or behavior, we are free to find another charity to contribute to.  Just make sure you do your research.

    Emmett McMahon
    Emmett McMahon subscriber

    It is a shame that there are liars and thieves all around us.  Think about it, preachers that like to track and 'play;around' with little kids to folks in just about ay line of business willing to sell or give out personal information about customers, affiliates or donors. Just greed and dishonesty.  It is not all of them, just a few.    .   

    richard brick
    richard brick subscribermember

    After the 2001 fire and millions of dollars donated by locals, the Red Cross gave out some blankets and shovels. After and investigation headed by Supervisor Jacobs, I believe, it was found that most of the money went to decorating Dotie's office, and the local office got a new phone system. 


    Please read up on the on going senate investigation of where the billions of dollars donated to the Haiti relief fund went. the Red Cross claims it built 9 houses with the money. Must be some houses to cost that much.


    This is a sorry charity that is more concerned with executive pay and their infrastructure then they are about people in need.

    msginsd
    msginsd subscriber

    @richard brick You have it wrong.  It's not about exec pay, or infrastructure.  At the national level, it's about pension obligations and congressional appointments of people who know nothing about running an organization like Red Cross.  The Haiti thing makes me sick. Tho, to be accurate, Red Cross didn't spend 'billions" on homes.


    At the local level, the problem is staffing the board and local exec management with "connected" people. Dodie Rotherham was the worst, but Jerry Sanders, Ronnie Froman, Tony Young, and now Bill Early are really the canary in the birdcage.  We need change.   We need a leader who has experience in this kind of nonprofit.  Supposedly those people were good to generate donations, so it was all about the money.   But as Tony Young stated, a lot of those donations get taken by National.  My observation about Tony Young?  He did nothing other than show off the organization to  his friends.  He was a non-entity.  Never connected with volunteers.    Above us as volunteers.


    Red Cross does a lot of good in San Diego, thanks to the 700+ volunteers (we have less than 10 paid staff).  As a volunteer, I can tell you that we continue to prepare for disasters,   The effort we expend is tremendous and we are concerned with people in need.  That's why, during the May wildfires, I worked 12-16 hour days.  I wasn't alone.  There were hundreds of volunteers who gave their time to help our neighbors and friends. We opened shelters in Carlsbad, San Marcos, and Escondido.


    San Diego Red Cross volunteers are ready to step up to whatever happens. 7/24/365.

    Derek Hofmann
    Derek Hofmann subscribermember

    Why is it legal, in America's Finest City, to buy and sell private personal information without the person's permission?

    Barry John Johnson
    Barry John Johnson subscriber

    Large non-profits are so ripe for improper action. The boards typically are not aggressive in oversight, with many on the board for PR purposes. They typically meet once a month and are at he mercy of the Executive Directors doling of information. Despite many large non profits receiving large amounts of public funds, they are not subject to public information transparency requirements. The salaries of the large non-profits can tend to get large, not just for the CEO but for an entire array of 2nd and third tier management staff. They then become creatures of the grant/donations as matter of maintaining the hierarchy.  A large non-profit can sometimes morph into a cult of personality for the Executive Director. Board members can actually be sought out by the ED, the person they are intended to provide oversight of. The heavy salaried 2nd and third tier staff are subject to the ED's whims. Typically, I see greater staff turnover at the lower direct service provider level. The Red Cross seems jacked up on all levels.


    I would like to see greater transparency for large non-profits. The IRS 990 forms which can be found online are often a good starting point to look at salaries and funding sources.


    I am always interested in the lavish fund raising events put on by these large non-profits. These are reported in the IRS 990 forms. The non-profits spend a lot of money to have these events which can manifest in the form of art shows, fashion shows etc. I would love to see reporting on these events, how much they make, costs etc