$43 Million Paid by Charity to Related For-Profit Wreath Company

CharityWatch CEO, Laurie Styron, recently talked to The Des Moines Register about Wreaths Across America, a charity that has come under fire for its close relationship with a for-profit company, Worchester Resources, Inc., that is owned by family members of an officer and an employee of the nonprofit.

“‘The loss of the charity’s business would likely present an existential threat to the for-profit company, and for this reason, there are no amount of controls that could be put in place to inspire confidence that decisions are being made in the charity’s best interest,’ she said.”

“Styron has said she believes the family should either divest from its wreath business or members should resign from the charity to eliminate ‘this very significant, inherent conflict.'”

Styron expressed similar concerns in an interview with The Military Times last year, saying, “The owners and their close relatives should either sell off their financial interests in the for-profit vendor, or the interested parties should resign from the charity and allow an independent board to recruit leaders in whom the public can have confidence in their capacity to act independently.”

CharityWatch contacted Wreaths Across America on November 20, 2024 via U.S. mail and the contact form on its website to request a complete copy of its audited financial statements and IRS tax Form 990 for its fiscal year-ended December 31, 2023. As of the date of this article the charity had not responded.

CharityWatch was eventually able to obtain a copy of Wreaths Across America’s fiscal 2022 audited financial statements from a public source. The audit covers an 18-month period ending on 12/31/2022. 

According to audit note 9, Related Party Transactions, “During the eighteen months ending December 31, 2022 the Organization paid Worcester Resources, Inc for wreaths, balsam products, shipping and other services. The husbands of an officer and an employee are majority owners in Worcester Resources, Inc. Total payments to Worcester Resources, Inc during the eighteen months ended December 31, 2022 were approximately $43,222,500 for wreaths. At December 31, 2022, $1,615,002 was owed to Worcester Resources, Inc for goods or services provided. 

According to audit note 10, Concentrations, “Worcester Resources, Inc, as the sole supplier of wreaths for the Organization, accounted for approximately 98% or $43,222,500 of the sponsorship related costs for the eighteen months ended December 31, 2022. The Organization is committed to maintain the relationship disclosed with this vendor in Note 9 through the December 31, 2025 wreath laying event.”

“Wreath sponsorships, as the major source of revenue, accounted for approximately 94% or $61,818,944 of total revenues for the eighteen months ended December 31, 2022. The Organization has no significant plans to diversify its revenue sources.”