Mission Statement Fraud Analysis

 Advertising and Marketing on the Internet: Rules of the Road

https://www.ftc.gov/tips-advice/business-center/guidance/advertising-marketing-internet-rules-road

 

"The FTC Act prohibits unfair or deceptive advertising in any medium. That is, advertising must tell the truth and not mislead consumers. A claim can be misleading if relevant information is left out or if the claim implies something that's not true"

What the Federal Trade Commission (FTC) is saying here is that if a company misleads (deceives, implies something untrue, misrepresents their intentions, tries to confuse) their consumer in any way in order to entice them into purchasing their wares or supporting their mission, IT IS CONSIDERED ILLEGAL/FRAUD. Based on this, I will provide my analysis of grantLOVE Project’s mission statement and all the instances that I consider to be misleading and potentially fraudulent.


This is grantLOVE Project's mission statement:

"The grantLOVE project is an artist-owned and operated project that produces and sells original artworks and editions to benefit artists and arts non-profits.

Created by Los Angeles artist Alexandra Grant in 2008, grantLOVE is a symbol of artist philanthropy. Alexandra was inspired by the work of Paul Newman and the Newman’s Own brand as a form of lateral philanthropy, where a company sells products in order to generate profits to give to charity. To date, the sale of grantLOVE products and Alexandra’s artwork (prints, sculpture, etc.), necklaces and rings have raised funds to support multiple Los Angeles art projects and charities."

1st Instance:

"Alexandra was inspired by the work of Paul Newman and the Newman’s Own brand as a form of lateral philanthropy, where a company sells products in order to generate profits to give to charity."

grantLOVE Project compares themselves to Newman’s Own.

 

Newman’s Own is a non-profit Charity that donates 100% of its profits to charity. This is a very well known fact. Most consumers recognize the brand and are aware of this fact. Many consumers buy these products because they know that their money will also help others and this is rewarding for them to do. They have a stellar reputation and consumers have absolute confidence in their philanthropic mission.

By stating that grantLOVE Project was inspired by Newman’s Own, they are attempting to transfer the absolute confidence the consumer has in Newman's Own,  onto themselves. 

 
They are also deliberately misleading the consumers into believing that grantLOVE Project donates 100% of the profits to charity, just like Newman's Own. This notion is implied with the comparison; but have you noticed that nowhere, in their mission statement, do they mention that they actually do in fact donate 100% of the profits to charity? The words they use are that they "sell products in order to generate profits to give to charity". This is a vague statement that easily misleads the consumer into thinking that all of the profits generated will be given to charity when that is not the case. Newman's Own gives ALL of its profits to charity; grantLOVE project DOES NOT.

This is the message they are trying to project: 

 

Newman's Own = grantLOVE Project

 

This is the reality:

 

Newman's Own ≠ grantLOVE Project
 

This is a very good example of what the FTC considers "misleading information". The comparison to Newman's Own is false.

If you were to believe that 100% of the profits earned by grantLOVE Project were intended for charity you would be wrong.

There are several instances throughout grantLOVE Project's website where this is proven; where they openly state that only a portion of the profits will be going towards charity. In fact, there are also instances where there is no portion identified as going to any charity.
 
I wonder what percentage of the consumers, that have bought the products from her website, are aware of the fact that only part of those profits are going to charity?

Which begs the question, if only a portion is going to charity, then where is the rest going to?

The next instance may yield some answers…



2nd Instance:

"The grantLOVE Project is an artist-owned and operated project that produces and sells original artworks and editions to benefit artists and arts non-profits."

 

grantLOVE Project is owned and operated by artist Alexandra Grant. Hence the singular "artist-owned and operated". This is important to note.

Technically, since the owner/manager, Alexandra Grant, is an artist, she would qualify as someone who can benefit from her own charity. After all, she is an artist and the profits earned can "benefit artists".

She very well could be funneling money to herself through her charity. Essentially, donating a portion of the profits from her charity to herself in order to pay for her art studio, supplies, travel expenses with regards to her career/business as an artist (separate from her philanthropic work). In which case, she would be personally benefiting from the profits that are gained through grantLOVE Project.

This is not allowed.

As mentioned before in my About grantLOVE Project post, LLC Charities (grantLOVE Project is an LLC charity) are considered Charitable Trustees by the Attorney General. There are more elaborate definitions on the Attorney General's website as to the fiduciary duties of a trustee. The most important of which is; THE BENEFICIARIES COME FIRST. Your duty is to the people or charities you are collecting for. These funds are put in your trust for THEM. Your duty is to ALWAYS think about them first. Self-serving behavior is considered unethical. If she were/is "donating" any money or assets to herself or the other businesses that operate at that address, she would be violating that code of ethics.

One indication that this may be happening can be seen when you compare the staff for grantLOVE Project and X Artists' Books.

 

The person below is a recent hire. They were hired as a Project Manager for both grantLOVE and X Artists' Books.

 

 

I wonder who is paying this person's salary? Is it divided between grantLOVE Project and X Artists' Books? It should be. What about Alexandra Grant? Would the work done by this individual sometimes overlap into her personal business as well?

 

Looking at their advertised skills sets, I would say they are more suited in a Public Relations role than Project Manager. Alexandra Grant relies heavily on Social Media as a promotional tool. Although she does use Instagram to promote grantLOVE Project, X Artists' Books and her personal work ( https://www.instagram.com/alexandragrantstudio/), her main focus has ALWAYS been advancing her public recognition and image via her personal Instagram (https://www.instagram.com/grantalexandra/). 

This is easily apparent with a quick glance at both the number of posts (green) and the number of followers (red) for the three Instagram accounts.

  

When you compare the four it becomes very clear that her main focus is herself. They look anemic by comparison.

 

I wonder if this is the new hire's primary focus? If so, who's funds are being used to pay this person's salary?

 

And then there is this individual, who has been working for X Artists' Books for almost two years now.

 

Yet they were the one manning the grantLOVE Project Pop-up Shop at Frieze last February. Did they volunteer their services?

Something tells me that Alexandra Grant is not very good at keeping a separation between herself and her other businesses, and that resources are often shared. In fact, I fear that she sees grantLOVE Project as an extension of herself and her daily operations very likely reflect this.

 

The way I see it, there are four businesses that share address 1610 W 7th Street #504, Los Angeles, CA  90017. Three of which are managed by Alexandra Grant.

1) grantLOVE Project (Alexandra Grant, LLC) - managed by Alexandra Grant

 

2) X Artists' Books, LLC (book publishing) - managed by Alexandra Grant

 

3) Marcia Grant LLC (residential real estate) - managed by Marcia Grant (Alexandra Grant's mother)

 

4) Alexandra Grant's personal business as a solo artist (separate from grantLOVE Project) - managed by Alexandra Grant

 

Unfortunately, given this, it is very likely that funds and assets have intermingled between all of these.

To summarize, I believe Ms. Grant uses the phrasing “benefit artists” in order to create a "loophole" for herself and to help mask the fact that she is actually giving herself some of the charitable profits. Again, this is misleading information. Consumers are led to believe that the donations are meant to help OTHER artists and arts non-profits, as in OTHER THAN HERSELF.

Don’t get me wrong, I do believe grantLOVE Project does donate some of the profits to charities, but they are not at all transparent about who they are, how often this happens and how much is actually donated. Which leads me to my next problem with the mission statement.

How much is actually donated…

3rd Instance:

 

"To date, the sale of grantLOVE products and Alexandra’s artwork (prints, sculpture, etc.), necklaces and rings have raised funds to support multiple Los Angeles art projects and charities."

grantLOVE Project was founded in 2008, it is clear that it would have raised funds since it first started. Why such a vague statement?

Normally, an organization/charity would list the amount of funds that have been raised and donated up until that point. They would update that amount, at minimum, once a year. The company has been in place and raising money for 12 years and all they say is that they have "raised funds"? The lack of transparency here is alarming!!

The lack of transparency throughout the grantLOVE Project website is extremely evident.

Sometimes they list that 100% of the profits go towards charity. See below...

Sometimes they say that a portion of the profits go to charity. See below...

 

Whenever they state the latter they never specify how much of that portion goes to charity. Is it 50%, 20% 1%? Do they donate $1 for every purchase? No one knows.

There are even some items where there is no mention of any of the profits going to charity. See below...

 
This is very strange since the items ARE being sold under grantLOVE Project and one would assume that at least some potion of the profits of every item sold by them would benefit charity, correct? After all, that is the basis of their mission statement. Plus, she even mentions it in this in this article...

https://www.laweekly.com/artist-alexandra-grants-teams-up-with-andsons-chocolatiers-for-a-limited-edition-love-box/

 
"My dream is for the grantLOVE symbol to sort of be like the Red campaign so that you know when you’re buying something with it on there you’re supporting the arts or arts education,”

Given this statement, how can she be selling any items on her website where no portion is going to charity???

Wouldn't this be illegal?

Isn't this false advertising?

The lower ticket items (like the hoodies) are typically the ones where it is stated that they donate 100% of the profits to charity.

There are far too many occasions where there is no mention of any portion going to charity. One could assume this was an honest mistake, but I don't believe that's the case. 

 

The grantLOVE website is a convoluted mess where a consumer can easily get confused as to whether or not their purchase will benefit charity in any way. It is riddled with deceptive tactics. This becomes more and more evident as you examine their other means of advertisement (Instagram, Facebook, articles in magazines and papers). They contradict themselves often. This is shameful and unacceptable!!

The lack of transparency as to who has benefited from grantLOVE Project and how much was donated is absurd. The only times, that I’ve seen, where there is mention of how much money was raised through the sales of grantLOVE products and who benefited from this money is when these are collaborative projects. As in, when grantLOVE is collaborating with another artist or company to raise funds through sales. For example, the Oscar De La Renta Collaboration where the proceeds were going to Project Angel Food.

 

My guess is that when Alexandra Grant is collaborating with someone else through grantLOVE Project, she has no choice but to be transparent about the money that is being earned. That is why the amount raised is always mentioned in those cases, but only in those cases.

Beyond those instances, she hasn't listed any amounts that have been donated. Nor has she mentioned any of the artists’ grantLOVE has donated too. This is highly suspicious to me. Why? Because highlighting whom the donations are going to does two things;

1- it brings attention to the artist and gives them much needed publicity. After all, an artist wants and needs this attention to sell their work, to get gallery showings, recognition, to pay the bills. By mentioning who is getting the donations she would be bringing awareness and attention to them as artists as well as...

2- bringing more attention to her grantLOVE Project. Therefore making it even more likely for her to get future purchases on her site because people know it is being put to good use and it makes them happy to be contributing to someone else's success.

She has the platform to do this through Instagram @grantalexandra (99.6k followers) & @grantloveproject (4,284 followers) but she never does it.

Why?

Wouldn’t it be a win-win situation

Publicity for her and grantLOVE, publicity for the artists.

It would be an extremely positive thing to do business wise, very good PR.

I have yet to see her do this. Maybe it's because if she did that, she would then have to account for the rest of the profit money and how it is distributed. Maybe she really does have something to hide there? It certainly seems that way.


4th Instance:

"The grantLOVE Project is an artist-owned and operated project that produces and sells original artworks and editions to benefit artists and arts non-profits."

 

I have been trying to decipher exactly who is supposed to benefit from the charitable profits based on her mission statement.

In the first sentence she says artists and arts non-profits. That’s pretty simple:

1) Artists (pretty self-explanatory)

 
2) Art non-profits (non-profit organizations that benefit the arts in some way)


In other words, the funds can benefit an artist or group of artists on various projects or they can benefit an art organizations that fall in the non-profit group.

  

They cannot benefit organizations that do not fall in the non-profit group 

 

They cannot benefit non-profit organizations that are not arts related.

Now lets list some of the beneficiaries for grantLOVE Project and what category they fall into:

1) 18th Street Arts Center - art non-profit

2) Epiphany Conservation Trust - This does not qualify. They are a non-profit but have nothing to do with the arts.

3) Heart of Los Angeles (HOLA) - art non-profit

4) LAXART - arts non-profits

5) LOVE House - social practice art project fiscally sponsored by Fulcrum Arts which is an arts non-profit

6) Project Angel Food - This does not qualify. They are a non-profit but have nothing to do with the arts.

7) Union for Contemporary Art - arts non-profits

8) X-TRA Contemporary Art Quarterly - arts non-profit

9) SAVVY Contemporary - arts non-profit

10) Orange County Museum of Arts (OCMA) - arts non-profit

Technically, grantLOVE Project has been contributing to organizations that DO NOT fall into the categories defined in their mission statement. 

 

Your mission statement should be what you honor. If you state that your charity will only benefit art based charities then you cannot raise and give funds to those that do not benefit the arts.

Project Angel Food's mission is "to prepare and deliver healthy meals to feed people impacted by serious illness, bringing comfort and hope every day". Although they are a noble and worthy cause, they do not benefit the arts in any way.

Since 2010, Alexandra Grant & grantLOVE Project has raised over $110,000.00 for Project Angel Food.

 

Now, the phrasing in this post is a bit confusing as it mentions both Alexandra Grant and grantLOVE Project as if they are separate donators. I had to do a fair bit of digging on this one and stumbled on this Youtube video - https://www.youtube.com/watch?v=_aUiD4Siag0. It's a video of Alexandra Grant's Visiting Artist Talk in Vermont from 2019. At the 22:21 mark she is talking about grantLOVE Project and the money she helped raise for Project Angel Food through the sale of her LOVE neons at one of their art auctions and says: "I sold three of these at an art auction in 2 minutes and raised $60,000.00". She then continues to talk about grantLOVE Project. The picture below is on the screen while she says this.

This is further corroborated by this post on Facebook for grantLOVE Project which mentions the pink and black neon created by Alexandra Grant through grantLOVE Project for Project Angel Food. 

 

Here is the problem with this. Just because this was done through an art auction, does not mean it is benefiting the arts. It is clearly stated in the grantLOVE post above that Project Angel Food is "a non-profit in Los Angeles that provides food and assistance to those who are too critically ill to take care of themselves". They are clearly aware of Project Angel Food's mission. And, unfortunately, they just don't qualify as an organization that can benefit from grantLOVE Project because they are not an arts related charity and grantLOVE Project is supposed to ONLY benefit artists and arts non-profits.

If Alexandra Grant wants to continue supporting these kinds of charities through grantLOVE Project, she needs to update their mission statement to reflect this. As it stands, I believe all the funds that have been raised and donated by grantLOVE Project for Project Angel Food have been inappropriately distributed as it contradicts her mission statement.

 

Or does it?

 

Lets take another look at the last line in her mission statement shall we?

 

"To date, the sale of grantLOVE products and Alexandra’s artwork (prints, sculpture, etc.), necklaces and rings have raised funds to support multiple Los Angeles art projects and charities."

"Los Angeles art projects and charities", what exactly does she mean by this?

 

At first read, I think she means art projects and art based charities in Los Angeles. But that can't be right because some of the charities she benefited are outside of Los Angeles or the state for that matter.

At the second read, I realize it is another vague statement basically stating that some of the funds raised have helped artists from the Los Angeles community but it is not limited to those from that community.

 

At the third reading, I realize that the way she phrased "Los Angeles art projects and charities" could imply that the charities don't have to be arts related. As in Los Angeles art projects and Los Angeles charities. Wait, what???

 

Is she actually negating part of the first sentence in her mission statement with the last sentence in her mission statement?? 

 

Basically implying that she can raise and use the funds for any charity she wishes, regardless of whether or not they are arts related?

 

Did she really just leave that last sentence completely open ended so that she doesn't have to stay within the implied limitations of her mission statement?

 

I believe so!! 

 

If my analysis is correct, this means that she created a loophole for herself so that she can raise funds for charities like Project Angel Food, if she so wishes.

 

And that is the biggest problem with her mission statement. It's all very unclear and convoluted. It is filled with misrepresentation, and it is deliberately misleading. It creates confusion. The fact that these apparent contradictions are present in her mission statement is a strong indication that they will also be present throughout her website. Guess what? They are!!

Conclusion:

I believe the FTC would have a field day with the grantLOVE Project's mission statement, as it is rife with misleading information. As such, I think what Alexandra Grant and grantLOVE Project really need is... a lawyer to help clean up this mess. There are so many snafus and deceptions in their mission statement alone, and that doesn't even begin to cover the other transgressions throughout the grantLOVE Project and her personal website. I feel sorry for whoever that will be. They will have their work cut out for them.