Wednesday, January 30, 2019

When is 100% not really 100%? (Part Two)

Recall from last episode, if you will, how Rebel Media's Ezra Levant, throughout the course of his 2016 Indiegogo fundraiser for the Red Cross, made two unwavering claims:

  1. that he personally and magnanimously donated an initial $10,000 as a kickstarter, to challenge others to follow his lead, and
  2. that the full and complete "100%" of funds raised via the Indiegogo page would be turned over to the Red Cross.

As we have already seen (and as Ezra eventually admitted to in his own Statement of Claim and subsequent Reply), this did not happen; rather, having relentlessly described his initial $10,000 as a "donation" and bragging about it incessantly, Ezra admitted later that it was no such thing, and that it was in fact a slush fund out of which he covered the loss of 5 per cent of everyone else's donations, in order to (technically) continue claiming "100%". In other words, Ezra admitted that his claim of "100%" could only be true if you allowed him to no longer count his own donation.

That the above is a fact conceded by Ezra is absolutely clear from Ezra's own Statement of Claim, wherein he admits that the 100% he has been touting all this time refers to donations only "from others":

In short, what was happening was exactly and precisely what countless people on social media had been telling Ezra -- that every single donation to Ezra's fundraiser lost 5 per cent to Indiegogo's processing fee (including, hilariously, Ezra's own initial $10,000), and that his claim of "100%" turnover to the Red Cross had been false the entire time. But as embarrassing as all of this is, it is about to get worse for Ezra. Much, much worse.

First, let us remind ourselves how much was donated to Ezra's Indiegogo page, which is still viewable online as we speak:

That would be precisely $162,476 (call this $162K for brevity), and I can assure you it represents the total amount contributed by donors before the deduction of Indiegogo's processing fee. Make sure you understand this as it is crucial for what follows -- that amount (which, in fact, includes Ezra's initial $10,000 "contribution") is the amount before Indiegogo takes its 5 per cent cut, which means that, according to simple math, what would be left to turn over to the Red Cross would be 95 per cent of that amount, or $154,352.20 (let's call this $154K for brevity).

There's no magic here, it's simple math -- the Indiegogo page always displays the total inflow from donors but, when the fundraiser closes, 5 per cent of that goes to Indiegogo, while the remaining 95 per cent is available to the fundraiser. And herein lies Ezra's imminent problem.

If Ezra continually claims that "100%" of funds/donations will be turned over to the Red Cross, and interested parties are watching the Indiegogo page and watching that number rise, they might get the (mistaken) impression that it is that precise amount (in this case, $162K) that will go to the Red Cross, and not the correct final amount of $154K (after processing fee). And it would have been a simple matter to clarify that difference early in the fundraiser ... except Ezra failed to do that, and it is that failure to clarify that eventually gets Ezra in a truckload of trouble.

History shows that Ezra's fundraiser was surprisingly successful in the first couple days, bringing in over $100,000, and surpassing $160,000 not long after that, and it's here where the trouble starts.

First, here's Rebeler Sheila Gunn Reid, on May 11 (only a week into the fundraiser), bragging about having raised "160k":

I'm sure you can see the problem here. We already know that, while the final amount listed on the Indiegogo page was $162K, the amount that would be available for the Red Cross would be only $154K, so one might suggest that Sheila is being just a wee bit misleading here, especially in the context of continuing to insist that "100%" would be turned over.

And one might forgive Sheila for a slip of the keyboard, except that this error continues with both Sheila and Holly Nicholas reporting on the displayed amount on the fundraiser page:

Once again, there is no clarification that "over $160K" is simply the amount displayed on the Indiegogo page, and not the actual amount that will eventually be turned over to the Red Cross. And if there was ever any such clarification posted during (or even after) the course of the fundraiser, I am unaware of it. But that's not Ezra's problem, which is shortly about to appear.

Recall that that displayed, raised amount of $162K included Ezra's own initial donation of $10K, which means that no matter how Ezra played semantic games and redefined the English language, 5 per cent of that entire amount went to Indiegogo, leaving Ezra with only $154K to pass on, and at some point, after his own staffers crowed about having raised "over $160K", Ezra would eventually have to 'fess up to the shortfall, and that fessing up began with no fanfare on June 16, 2016, when Ezra bragged over at Rebel Media about the success of his fundraiser, but quietly back-pedaled on the amount raised:

Yes, you're reading that correctly -- after numerous assurances of "100%" turned over, and after Rebel staffers crowed about raising "over $160K", Ezra has finally been forced to acknowledge Indiegogo's processing fee, and quietly dial back the amount he claims to have raised to actually match what he was able to turn over.

In case you think that's a typo, Ezra published exactly the same, quiet back-pedaling on Rebel TV's Twitter account:

In short, having deceived donors into thinking that their entire donations would be turned over to the Red Cross, once the fundraiser is over, Ezra is now (with no fanfare) very quietly correcting his claims to now match reality, and hoping donors don't realize that their entire donation could have gone to the Red Cross if they had simply donated to the Red Cross directly (which does not charge a processing fee). But we're not done (as we never are).

Even if donors never twigged to what was happening, the Red Cross did note that something seemed odd, as I have in my possession a series of e-mails between Ezra and the Red Cross' Susan Larkin, and it is this e-mail of Jun 13, 2016 that is relevant here:

in which you can clearly read that Larkin seems uncomfortable with Ezra's current bragging about having raised "more than $150,000" and prefers that Ezra use the more precise amount of $162,476 displayed on the Indiegogo page. And while Larkin is probably unaware of Ezra's semantic manipulation, she still obviously realizes that something doesn't sit well with her in terms of how Ezra is downplaying the amount raised. But there is one more point worth making here.

Readers might be a bit concerned in my describing the way Ezra ran his fundraiser and how he misled his donors about the "100%" as "deceptive," wondering if perhaps I'm crossing a line here. I am not worried about calling out Ezra's 2016 Indiegogo fundraiser for the Red Cross as deceptive since, in fact, the Canada Revenue Agency says exactly the same thing.

In their page describing acceptable fundraising practices, the CRA devotes an entire section to warning prospective donors about "Fundraising that is deceptive", and I particularly draw your attention to the caution specifically about fundraisers that claim that 100% of donations will be turned over:

As you can clearly read, the CRA explicitly and specifically warns donors about fundraisers that claim that 100% of their donations will be turned over, particularly in light of having to pay fees to any third-party fundraiser that it employs for that fundraising.

If that sounds familiar, it's because that is exactly what happened here -- Ezra persistently claimed that he would hand over fully 100% of all donations to the Red Cross, even when he knew that was impossible due to Indiegogo's processing fee. In short, that CRA warning describes, to the letter, what Ezra did, and I need only repeat the final highlighted sentence above: "this type of claim could be considered to be deceptive." And if the CRA is willing to call this type of behaviour deceptive, who am I to argue?

Coming up: one last post on all of this, wherein I examine Ezra's claim that all of the donations to his Indiegogo fundraiser would be matched (thereby tripled in value) by the federal and Alberta provincial governments. And how that never happened.

P.S. It's worth mentioning another significant point. Ezra's numerous assurances that he would turn over "100%" of all "donations" rests entirely on his later contention that his own contribution of $10,000 should not be considered such a donation, and that that amount is somehow excluded from his mathematics. That argument is feeble at best, for a number of reasons.

First, as I mentioned earlier, the Indiegogo page for that fundraiser is still online, and it shows both the final raised amount of $162,476, along with a note that that money was raised from precisely 1094 backers:

Remember those numbers for just a minute.

At this point, to see all of the contributors, one need only click on the "BACKERS" link on that page to end up here, and if you scroll down to the very bottom, you end up seeing the very first contributor to that fundraiser; unsurprisingly, it is in fact Ezra Levant with his $10,000:

In short, Ezra's $10,000 was donated to his own fundraiser just as everyone else's donation was received, so there is no reason to treat that contribution any differently from anyone else's. But it gets worse.

In a May 4, 2016 tweet (only one day into his fundraiser), Ezra tweeted thusly:

wherein Ezra is announcing not only his own $10,000 donation but, in the very next sentence, making the promise of "100% of funds to the Red Cross." One would think that it would be difficult to argue in court that, in the midst of a single tweet, you were completely redefining the concept of what constituted a donation, and that that first sentence was in no way logically connected to the second one.

Finally, though, it is Ezra in his own June 2016 Statement of Claim that clearly admits that his initial $10,000 is nothing more than a regular donation by a regular backer when he writes:

That would indeed be Ezra Levant, in his own Statement of Claim, confirming that his Indiegogo page raised $162,476 "from 1094 donors," of which we have already seen that Ezra himself was donor number one, meaning that Ezra is describing himself as just another donor that contributed to the final tally of $162,476.

In short, Ezra's lawsuit-driven contention that his initial donation of $10,000 is not a real donation and is somehow not subject to his assurance of 100% being turned over is totally and utterly contradicted by his own actions and public pronouncements.

P.P.S. In case people want to know exactly what was eventually handed over to the Red Cross, I have a January 10, 2017 e-mail from the Red Cross' Susan Larkin, confirming a precise final amount of $156,921. While that amount is oddly slightly higher than 95 per cent calculated above, that is because a small number of donors chose to Canada Post mail their donations rather than hand them over online. In any event, it is absolutely clear that there was a several thousand dollar shortfall between the "100%" that was publicly promised, and what was finally delivered to the Red Cross.

I will produce that very e-mail in my next and last blog post on this subject; you'll just have to take my word for it for the time being.

P.P.P.S. Apropos of nothing, it's worth pointing out that it's been over two and a half years, and we are still waiting for the Ezra Levant-inspired convoy to head north and put Fort Mac back together:

On the other hand, rumour has it there's another convoy organizing in Alberta these days ... perhaps they could make themselves useful.

It's just a thought.

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