Charities Raising Funds

 

Dear Friends:

New York is home to thousands of charitable organizations. Many of those charities engage the services of Professional Fund Raisers to raise funds on their behalf. Fund raisers are hired for many reasons. Some organizations do not have sufficient staff to raise funds. Others do not have the expertise necessary to conduct fundraising campaigns. Small organizations may view professional fundraising campaigns as a way to get more people involved in their causes.

Whatever your organization's reason for hiring a fund raiser, it is important to learn as much as possible about the fund raiser's experience and record before signing a fundraising contract. Remember - the fund raiser will be representing your organization in seeking support from members of the public.

Following the tips listed below should contribute to the success of your fundraising campaigns and assist your organization in avoiding the financial loss, bad reputation and other problems that may result from hiring an inexperienced or unscrupulous fund raiser.

Sincerely,

Eric T. Schneiderman

New York State Attorney General
The State Capitol
Albany, New York 12224
1-800-771-7755
www.ag.ny.gov

 

Make periodic visits to any telephone room used by telemarketers. Each person who is employed by the professional fund raiser to make calls on behalf of your organization must be separately registered with the Attorney General as a professional solicitor. Your visits will enable your organization to learn what the public is being told about the organization.

Obtain the professional fund raiser's copies of invoices and receipts to be sure that vendors are paid on time. If they are not, they will probably seek payment from your organization.

Make sure that your organization is given periodic accountings of the fundraising campaign and that the fund raiser is keeping records of funds received and expended during with the campaign. Remember, your organization is responsible for all funds raised in your organization's name by a professional fund raiser.

 

For information concerning registration of charitable organizations contact:

Department of Law
Charities Bureau
120 Broadway
New York, NY 10271

(212) 416-8400

For information concerning registration of professional fund raisers, fund raising counsel and professional solicitors, contact:

Department of Law
Charities Bureau
The Capitol
Albany, NY

(518) 486-9797 or Visit the Attorney General's Internet Site at:

www.ag.ny.gov/bureaus/charities/about.html

 

Make sure your organization is properly registered with the Attorney General's Charities Bureau and current in its annual financial filings.

Check with the Charities Bureau to see if the fund raiser and its professional solicitors are registered and have currently filed the required contracts and financial reports.

Find out from the Charities Bureau what other charities the fund raiser represents.

Ask the Charities Bureau for copies of the fund raiser's contracts with other charities to determine what the fund raiser agreed to do for those charities.

Ask the Charities Bureau for copies of the fund raiser's financial reports of fundraising campaigns conducted on behalf of other charities.

Ask the fund raiser for references. A reputable fund raiser should be happy to provide a potential client with the names, addresses and telephone numbers of some of its clients.

Contact charities for which the fund raiser has worked, find out what was promised, what was done, whether there were any problems and if the charity is satisfied with the work done by the fund raiser.

Make sure all contracts between your organization and a professional fund raiser are in writing as required by New York law.

Read all provisions of the contract before signing it. The contract should state clearly all of its terms. If something is unclear, the contract may need revision.

Consider whether funds solicited by the fund raiser should be received by the charity itself or by a bank or other fiduciary custodian instead of the fund raiser.

New York law requires that fundraising contracts include the following provisions:

  • If funds are to be received by the fund raiser, within five days of receipt all funds solicited by a fund raiser must be deposited in a bank account exclusively controlled by the charity.
  • The charity has the right to cancel the contract without cost, penalty or liability within fifteen days after the fund raiser has filed it with the Attorney General.
  • Clear descriptions of the services to be provided by the professional fund raiser and the financial terms of the contract.
  • Names, addresses and registration numbers of both parties to the contract as well as the dated signatures of the fund raiser and the charity.

Follow activities of the fundraising campaign.

Review all written solicitations and scripts used by the fund raiser -

  • Make sure that solicitation material accurately describes your organization and its activities.
  • Solicitation material must include the name of the organization as registered with the Attorney General.
  • All solicitations must advise potential contributors that they may obtain a copy of the soliciting charitable organization's financial report from the Attorney General or from the organization itself.
  • Any solicitation conducted by a professional fund raiser or any of its representatives ("professional solicitors") must disclose the name of the specific professional solicitor, the name of the employing professional fund raiser and a statement that the solicitor is being paid to raise funds.
   

 

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