Viewpoint Viewpoint (May 14, 2004)

Buyer beware before donating cars

Donating an automobile to a charitable cause is one of the most heavily advertised promotions in the media these days, with the ubiquitous sales pitches appearing in newspapers, magazines, online and on the radio. The "hook" of most ads is a promise to help a cause that everyone can support, like victims of domestic violence. The ads also promise an easy transaction with a toll-free call, free disposal of the vehicle and a tax deduction.

But if ever there was a need to apply the old adage "caveat emptor, or let the buyer beware," it is in this genre of charitable giving. For in many instances, the charitable cause receives only a fraction of the donation's value. A case in point is the Mountain View operation run by Gary Kegel at www.cars4care.com, which calls itself the Community Fellowship for Battered Women of Silicon Valley and the Peninsula, Inc.

Mr. Kegel's operation, described in last week's Voice, continues to advertise for auto donations online, even after running afoul of city ordinances by improperly operating a used car lot where the city said illegal repairs and car sales were conducted. Apparently responding to the city's legal pressure, Mr. Kegel abandoned his car lot and the house he used as a shelter, although he continues to accept donated cars without revealing his place of business.

He told the Voice last week that he is continuing to help women, but not necessarily battered women, and that he is attempting to contact Yahoo to correct his Web advertisement, which promises to help victims of domestic violence and battered women. But he continues to monitor his phone and when someone leaves a message about donating a used car he responds quickly. But regardless of whether Mr. Kegel is living up to his claims, his organization's primary source of income - the donated cars - can continue unabated. And we suspect that is the primary motivator for his operation. In the year 2002 alone, Mr. Kegel took in $186,000 in revenue from donated cars, while only $10,000, or just over 5 percent, was spent on program services for the women he helped.

Mountain View City Attorney Michael Martello has made no bones about his belief that Mr. Kegel's operation is not on the up and up. "To me this was a completely fraudulent operation," he said. "It is a scam completely. . . They weren't supposed to be repairing (or) selling cars." But unfortunately, Mr. Martello has little jurisdiction in matters of this type. Now that Mr. Kegel has vacated the car lot, the city has no reason to prosecute on those grounds.

Only the Internal Revenue Service, by enforcing its regulations governing charitable contributions, can bring a halt to what is becoming a glut of organizations seeking donations of vehicles of any kind, as well as other household goods. Until the IRS steps in, this so-called "charitable" method of disposing of unwanted vehicles will have to be regulated by "caveat emptor." For those who want to make sure their donation will truly help battered women, we recommend the Support Network for Batter Women, at www.snbw.org.

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