By Staff Reporter, May 15, 2013 03:42 PM EDT
(PHOTO CREDIT: stock.xchng)
A nonprofit watchdog has disclosed that Locks of Love, the charity that makes hairpieces for needy children suffering from hair loss, has $6 million in hair missing.
"Locks of Love continues to build its balance sheet through fundraising and disclosed sales of $500K-$1MM of hair each year while $3.8MM in cash and investments remain idle on the balance sheet," writes Nonprofit Investor (NPI). "With disclosed personnel and office expenses of less than $1MM per year and net assets of $6MM, NPI views $6 years of reserves to be an inefficient use of capital."
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That said, it's important to note that only 20 percent of donated hair can actually be used. Locks of Love told The New York Times in 2007 that a significant portion of the donations cannot be used since it is too moldy, too short, gray or too processed. Additionally, some of the hair may be sold to help the charity cover its cost.
But according to the report by (NPI), Locks of Love produced 317 hairpieces in 2011, but could have produced 2,080. The report states that 104,000 locks of hair is donated each year and even after 80 percent that cannot be used it taken into account, $6 million in hair is missing each year.
"We're not making a judgment one way or another. What we are saying though is the amount of hair that is unaccounted for every year is significant. It's $6 million every year," said Kent Chao from NPI to ABC News. "Human hair is extremely valuable. It's a multi-billion dollar industry worldwide."
Locks of Love president, Madonna Coffman, issued the following statement in response to the report:
"To our knowledge we are the only organization that provides a vacuum fitted, custom prosthesis, as opposed to 'wig' that can be mass produced and inventoried until needed. False claims based on inaccuracies, fabrications or assumptions will not interfere with our commitment to these families."
Check out the infographic by NPI: