Kars4Kids, a US-based charity famous for its long-running car donation commercials, quietly funnelled tens of millions of dollars annually to an Orthodox Jewish organisation that funds trips Israel and bought property there, according to court findings and public records.
The revelations resurfaced after a California judge barred the organisation from airing its current advertisements in the state unless it clearly disclosed its religious affiliation and where donor money was primarily going.
An Orange County Superior Court judge ruled that Kars4Kids violated California false advertising and unfair competition laws by omitting key information from its ads, including that much of its funding was directed to Oorah, an Orthodox Jewish group with ties to Israel.
For more than two decades, Kars4Kids advertisements aired across the United States, encouraging people to donate unwanted vehicles to help children in need through its now-famous jingle.
The advertisements featured children singing and dancing while asking listeners to "make a difference in the life of a child", without explicitly mentioning the organisation’s Orthodox Jewish affiliation or overseas-linked activities.
The court case was brought by California resident Bruce Puterbaugh, who donated a non-functioning 2001 Volvo XC valued at $250 after believing the charity helped "underprivileged kids from all over the US", according to court documents.
Puterbaugh later learned that Kars4Kids primarily funds Oorah, which runs summer camps in the New York and New Jersey area and organises gap-year trips to Israel for 17 and 18-year-olds.
Court findings and previous investigations also showed that Oorah used $16.5 million originating from Kars4Kids-linked funds to purchase property in Israel.
"I feel taken advantage of by the ad and information that was not there," Puterbaugh said in court testimony.
Judge Gassia Apkarian found that the ads created the impression donations broadly supported disadvantaged children, while failing to disclose that more than 60 percent of Kars4Kids’ revenue, estimated at around $45 million annually, was transferred to Oorah.
Esti Landau, Kars4Kids’ chief operating officer, reportedly testified during proceedings that the charity’s advertisements did not mention the Jewish community.
According to court documents, around 30,000 of the 120,000 cars donated nationwide came from California.
The ruling did not revoke the charity's non-profit status or ban its operations. Instead, the court ordered Kars4Kids to stop airing its current advertisements in California unless they include explicit disclosures about its religious affiliation, where beneficiaries are primarily located, and the age groups served by its programmes.
The court also ordered Kars4Kids to reimburse Puterbaugh $250, representing the estimated value of the vehicle he donated.
In its ruling, the court stated: "Money cannot 'un-donate' a car or restore the donor's belief that they were helping a local, needy child."
The ruling added: "When a charity generates millions annually through a 'jingle' that conceals its primary religious and geographic focus, it creates an unfair playing field for local California charities that are honest about their missions."
Under the ruling, any future Kars4Kids advertisements broadcast in California must disclose the organisation’s religious affiliation and the primary geographic location of beneficiaries.
The court also ruled that future ads cannot include images of young children because several of Oorah’s programmes serve older teenagers and young adults.
Kars4Kids rejected the ruling, calling it "deeply flawed, ignores and misrepresents the facts that were presented at trial, and misapplies the law."
The organisation repeated the same statement when approached by The New Arab for comment. Track record of false advertisement The controversy has renewed scrutiny over the transparency of religiously affiliated charities soliciting donations from the wider American public.
Kars4Kids has faced similar criticism before. In the late 2000s, the organisation was fined in several US states for failing to adequately disclose its religious affiliation in fundraising campaigns.
A 2017 report by the office of former Lori Swanson found that only 44 percent of the $88 million raised nationally from donated vehicles between 2012 and 2014 went directly towards charitable programming, while around $40 million was transferred to Oorah.
The report described the findings as "concerning and troubling".
The Kars4Kids jingle, first aired in New York in 1999, later became one of the most recognisable charity advertisements in the United States and was frequently mocked and parodied in popular culture, including on Saturday Night Live.