The scandal surrounding Three Cups of Tea has not only increased scrutiny over nonprofits operating in the developing world but has become the talk of the North American nonprofit community.

from the Wall Street Journal:

The Big Spill Over ‘Three Cups of Tea’

Grass-roots nonprofits across the country now find themselves under intense scrutiny because of the Mortenson scandal. Many are considering going to new lengths to demonstrate to potential donors that they are on the up-and-up. All are bracing for an impact on giving. Many foundations and wealthy donors now are cautious because of “reputational risk” if they give to an organization that falters.

The scandal is the talk of the nonprofit community – though many won’t talk about it on the record. More extensive auditing is likely to result, according to Jim Zoiklowski, founder and president of BuildOn, a nonprofit that runs afterschool programs in American cities and builds schools abroad.