An Incomplete Picture

A recent scandal around a popular YouTuber’s nonprofit foundation has created a lot of drama, but what it’s missing are voices that understand the nonprofit sector.

By Ernie Smith

As I pointed out in a recent post, good investigative commentary can be had on YouTube if you know where to look—something that Hbomberguy’s recent video on plagiarism I felt delivered in spades with a thoughtful selection of in-depth reporting and analysis.

But unfortunately, this can cut both ways, and another prominent controversy in the YouTube sphere highlights this. Recently, the gaming YouTuber Karl Jobst, who is well-known for his investigations of speedruns and fraudulent practices in the gaming industry, published a video explaining that Jirard Khalil, a fellow gaming YouTuber known as The Completionist, had misled his audience about a charity event he had been running for a number of years.

The problem? The charity, called The Open Hand Foundation, had not donated any of the funds it had received over a period of more than a decade from charity golf events and Khalil’s IndieLand online streams, among other things.

Jobst, collaborating with Mutahar Anas, another YouTuber running a channel called SomeOrdinaryGamers, had caught something legitimate—a lack of donations that, combined with Khalil’s past statements, could be seen as misleading. The problem was, they felt the need to keep feeding the beast on an important story, and Khalil, as well as the foundation, were not speaking up for obvious reasons.

And that created a situation that might have crossed a serious line, as both Jobst and Anas published videos that strongly suggested Khalil and his family were guilty of charity fraud. Jobst in particular told his viewers to report the foundation to the California Attorney General.

“It’s obvious Open Hand isn’t in a rush to respond or donate the money, so at this point all we can do is wait for those with power to step in,” he said.

But the thing is, Open Hand did end up donating the money at the end of last month, in fact just before the Jobst’s second video posted. And in a pointed video that appeared to have been formed with the assistance of legal counsel, Khalil made it clear that, while he was apologetic for the challenges with donating the money at scale, the videos created by Jobst and Anas often misrepresented the charity, and what’s more, that his family was considering legal remedies.

So, what gives here? Speaking as a journalist who is not a regular viewer of the stakeholders’ channels but has had a history of reporting in the nonprofit space, one of the key things I noticed when watching Jobst and Anas’ clips was that their reporting was based on a mixture of source materials and speculation. They had one part of that equation covered by using the source materials, but they were often basing their perspectives on what Khalil’s nonprofit was and wasn’t based on online research alone, and the fact is, researchers on speedrunning scandals may not know all the details about analyzing tax information for 501(c)(3) nonprofits.

That’s not to say Karl Jobst is a bad journalist—far from it. He has done good work over the years in his niche of speedrunning. But his reporting was missing an expert voice, which meant that questions that could have firm answers or proper context were instead filled with speculation. Often, when I am covering a topic I lack familiarity or specificity with, I bring in an outside source—in the case of nonprofits, that meant talking to sources like lawyers and financial experts on the challenges that can face charities. (Lawyers, it should be noted, often don’t speak in absolutes about specific situations when talking to media outlets.)

Jobst didn’t do that, essentially meaning he was interpreting the documentation himself. So it was just him and Anas reading documents on a website, which creates a situation where Khalil or his lawyers could argue that people who are not experts on nonprofit tax code made some serious contextual mistakes. To be fair, journalists do this all the time, but neither Jobst nor Anas appear to have a background in this kind of journalism. Long story short, they needed interpreters to ensure they weren’t reading things incorrectly.

Additionally, there is a case that he needed to see if he could surface any sources close to the foundation, to see if there were any details about how the organization operates that he could highlight in the process. What do those details look like? These were peppered throughout Khalil’s response clip—he was able to point out that donations and expenses don’t often flow in all at once, leading to situations where expenses and donations alike may not fully appear on one tax document or another. (Anas, in a response, disregarded this stuff as “legalese,” but it turns out that the details matter in potential legal cases!)

It’s not always easy to get this as an outsider reporting on a piece of news, but there are always ways, including getting a source to speak to you off the record. Hbomberguy’s clip on plagiarism offers an excellent internet-native example of this: At one point, he went into culture YouTuber James Somerton’s Discord and analyzed how he and a writer interacted when building clips. One of Somerton’s drafts that wasn’t used included a plagiarized passage, which Hbomberguy determined came from a conservative blogger who was diametrically opposed to everything the LGBTQ commentator stood for.

To Jobst’s credit, he tried to do some of this by highlighting past things Khalil and other Open Hand Foundation stakeholders said on social media feeds. But the problem is, the foundation has real-life elements that Jobst didn’t account for through interviews, which meant he was assessing donation numbers through pictures of golf tournaments that happened five or more years ago. Jobst, honestly, needed a mole—and maybe he went looking and perhaps didn’t find one.

I think the most serious issue is that Jobst directly accused The Open Hand Foundation of charity fraud, something he did not need to do with his reporting, but likely played well to the YouTube audience he was trying to reach. (When you’re raising allegations as a journalist, let the evidence speak for you.) This to me reflects why it was dangerous not to bring in an expert to help back up or contextualize his claims. The second he did that, it turned his work from journalism into advocacy, and potentially undermined his reporting work—which, as a reminder, correctly called out the fact that The Open Hand Foundation had not donated the money.

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At the center of this issue is restricted funds, not fraud

I think the problem with this situation is there was a lot of who and what in the reporting and not much why. As in, why do some foundations not donate in a timely fashion? Do other nonprofits operate like this? Is The Open Hand Foundation a unique case?

These questions went unanswered, unfortunately, and I think it created an unnecessarily volatile situation as a result.

Here’s what I can offer to this conversation as someone who has covered nonprofits at length: The “why” of this, from my vantage point, is the conflict between restricted and unrestricted funds.

There is currently a trend away from restricted funds in the sector, in part because of the challenges they create for overhead. A decade or two ago, the Guidestars of the world did a real number on nonprofits by putting the thought in people’s heads that paying salaries or covering the cost of day-to-day operations was a bad thing, and much of the coverage in the nonprofit space in recent years has pushed back against the overhead-is-bad boogeyman.

A 2021 paper on restricted funds, by authors ChiaKo Hung and Jessica Berrett, found that restricted funds can have a negative effect on service impact. (The paper is paywalled, unfortunately, but The NonProfit Times has a useful summary here.)

The Open Hand Foundation, for obvious reasons, didn’t want to do that. They’ve already paid a ton of overhead on their funds just in payment processor fees, and their endowment that isn’t as large as, say, the unrestricted funds that MacKenzie Scott has been offering nonprofits in recent years. Plus, it simply feels good to know that all the money they raised actually went to medical research and patient support.

The foundation, which is in no position to do frontotemporal degeneration research of its own, is small enough that they possibly did the math and determined that they could ultimately donate more directly to their cause if they held the donations for eventual restricted use, that it would still ultimately be more valuable even after inflation (which, for context, was rising at a much smaller rate when IndieLand started). But that is just speculation that they themselves should answer for. There is an argument that they shouldn’t restrict the funds at all, or ensure that a portion of the funds goes directly to overhead, and per the press release announcing the donation of the fund, that’s where they eventually landed.

Combine this with the fact that The Open Hand Foundation is a fairly small organization staffed by family members and volunteers that have full-time jobs (The Completionist’s whole thing is that he completes video games, after all), and you have a situation that is easy to misconstrue. Khalil didn’t do himself many favors by puffing up what the foundation was actually doing in interviews, but as creators assuredly know, puffery comes with the territory.

All that said, I did reach out to a couple of nonprofit academic and research organizations about this topic, to see if they could help determine if a situation like Open Hand’s is common, and will update this piece if I hear back.

Anas posted a response to Khalil on Sunday that essentially took the stance that Khalil, by focusing on small details, was obfuscating the bigger issue; Jobst has said he is working on a response video of his own. I encourage both of them to bring more specialized sources into their reporting and to let the storytelling do the work, because right now, what this situation needs is a fresh pair of eyes.

Update (12/15/2023)

Since I posted this, Jobst uploaded another clip. I think the most consequential point of the entire thing hits around the 19 minute mark, from Jirard’s conversation with Jobst and Anas:

We’ve been having conversations about moving it as early as as today or tomorrow just because the pressure I got from you guys, if I’m being quite honest. Not that I was trying to say face, but like, this is a private fight that I’ve been dealing with for months with my family. And I even told my family, hey, this is the last IndieLand I’m ever going to do, because this is the 10th year anniversary of my mom’s passing, and when I kind of found all this information out, I was very unhappy with how things were going.

That, to me, sounds like a boardroom battle, and one where Jirard’s point of view on the issue was at odds with other board members—i.e. his own family. He might have wanted to move quickly, but perhaps his father disagreed with the approach, for example. Boards can sometimes move slowly and be indecisive, and adding family dynamics to the picture may not have helped matters either.

I can take or leave Jobst’s claims of embezzlement—I think while Khalil probably spoke a bit too loosely during IndieLand, the format is a livestream and does lead to a lot of loose talk. Dude is filling time for hours, because that’s how the format works, and that lends itself to slip-ups. It doesn’t seem like he was being intentionally misleading, for the most part. But I do think that if Khalil decides to do another livestream like this in the future, he should probably cut out the middleman. It’s clear that what they were building towards struggled from an execution standpoint, and the use of a charity tied directly to Khalil has raised too many questions.

This story still needs voices who aren’t personally attached to the stakeholders, to be clear. A good example of the kind of analysis Jobst and company should bring into their work is this forum post, which offers a lawyer’s perspective on the situation.

Update #2 (12/15/2023)

I think this response from Pat Contri highlights a balanced way to handle serious allegations in a situation like this. He doesn’t take sides, he doesn’t default to attacking or defending, he states plainly that the situation looks bad, calls for an investigation, and avoids either overstating or understating what happened. He has a personal stance in the situation, but he tries to separate his feelings from that.

I don’t know what we’ll find out from here, but I encourage this kind of approach as things continue to get worked out.

Update #3 (12/18/2023)

A raw audio interview of the stakeholders was published earlier today after initially being posted to Discord. This is a good thing from an observer standpoint as it limits interpretations of what was actually said. I think to some degree the issue comes down to people who didn’t know what they were doing trying to do the right thing, and struggling with the execution.

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Ernie Smith

Your time was just wasted by Ernie Smith

Ernie Smith is the editor of Tedium, and an active internet snarker. Between his many internet side projects, he finds time to hang out with his wife Cat, who's funnier than he is.

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