Wall Street giants cut charity funding with opaque logic, investigation finds

A ProPublica investigation has identified significant inconsistencies in how major donor-advised fund (DAF) sponsors manage charitable giving, revealing that Vanguard Charitable, Fidelity Charitable and Charles Schwab’s DAFgiving360 selectively cut off funding to certain organisations while continuing to accept donations for others facing similar government scrutiny. These three entities, which control more than $327 billion and facilitate approximately a quarter of all individual giving in the United States, paused donations to the Southern Poverty Law Center (SPLC) following its indictment by the Department of Justice on fraud charges.

The investigation found that while sponsors cite reputational risk and policy triggers such as formal charges or investigations to justify these decisions, they have provided little transparency to donors or affected charities. The SPLC remains unaware of the specific reasons for the block or whether there is a path to reinstatement, despite the legal case against it remaining active and a former employee being indicted on related charges this week.

ProPublica’s review of giving records and policies uncovered that Fidelity Charitable and DAFgiving360 allowed donations to continue flowing to other organisations under government investigation, including hospitals, universities and a white nationalist group. These included Providence Health and Services, which faced allegations of illegal billing practices; Grand Canyon University, which was fined for deceptive advertising; Idea Public Schools, investigated for lavish spending; and the VDARE Foundation, a white nationalist organisation facing a lawsuit from the New York Attorney General.

Critics argue that these actions, amplified by political pressure from the Trump administration and Republican lawmakers, stifle charitable work and set a dangerous precedent. The administration has intensified scrutiny of nonprofits, with members of Congress initiating over 135 investigations since 2025. Legal experts warn that relying on private eligibility determinations rather than IRS status allows for inconsistent application of rules, potentially enabling politically motivated investigations to suppress organisations without proof of wrongdoing in court.

The fund sponsors have declined to be interviewed or answer detailed questions about their processes. Vanguard Charitable stated its pauses are objective criteria applications, while Fidelity Charitable said it does not comment on individual charity decisions. DAFgiving360 asserted it communicates directly with donors regarding eligibility determinations. Meanwhile, 16 state attorneys general have written to the sponsors expressing concern that their actions could allow weak or politically motivated investigations to chill charitable work, a sentiment echoed by donors who have begun moving their assets to other sponsors.