Dispute Impeded Red Cross Katrina Response By HOPE YEN, Associated Press Writer

Years before its uneven response to Hurricane Katrina, the American Red Cross struggled unsuccessfully to resolve internal disputes that beset its Sept. 11, 2001, relief efforts, internal documents show.

In an Oct. 29, 2001, e-mail, board member Bill George chided Red Cross management for not embracing change. At the time, the nation's largest charity was reeling from CEO Bernadine Healy's resignation amid charges it had mismanaged Sept. 11 donations.

Thousands of pages of Red Cross e-mail, corporate documents and whistleblower complaints paint a picture of an organization hampered by its mammoth structure, which gives local chapters extensive control and limits the powers of a CEO in a major disaster.

Sen. Charles Grassley (news, bio, voting record), R-Iowa, calling for immediate changes, warned the Red Cross board Monday that "'business-as-usual' cannot continue." He said the documents raise questions about the Red Cross' ability to keep close watch on billions of dollars in donations.

"This type of culture, a culture that discourages people from coming forward, management that does not want to hear the bad news, and is more concerned about good press than good results, is a theme that I am hearing too often," said Grassley, who, as Finance Committee chairman, oversees charitable organizations.

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