Donors Warned About Professional Fundraisers
Attorney General Spitzer today released his office's annual report on the fundraising activities of non-profit corporations. The report shows that less than a third of the money raised by professional telemarketing campaigns actually goes to charity.
"Pennies for Charity, Where Your Money Goes: Telemarketing by Professional Fund Raisers" provides a summary of information filed with the Attorney General's Charities Bureau by professional telemarketers who conducted fundraising campaigns in New York State in 2002.
It shows that a total of $184.3 million was raised by 607 fundraising campaigns conducted in 2002. However, only $57.1 million, or 31 percent of the funds, actually was retained by charitable organizations. The remainder was paid to the telemarketers as fees and other costs of the campaigns.
"This annual report makes two key points," Spitzer said. "First, donors need to make informed decisions prior to making a charitable contribution. In many cases, it is better to give money directly to a charity than to a professional fundraiser."
"Second, the people who serve on charitable boards have an obligation to remain actively engaged in their organizations' fundraising decisions. Board members must take responsibility for the selection of professional fundraisers to ensure that their organization's income for charitable purposes is maximized."
The Attorney General identified the following professional fundraisers whose campaigns yielded the least amount for charity - on average 12 percent or less of the funds raised:
Telesystems Marketing, Inc. (Houston, TX) 12%
Community Affairs, Inc. (Pompano, FL) 11%
LAS, LLC (Washington, DC) 11%
Theodore Productions, Inc. (Gettysburg, PA) 10.3%
Nationwide Fundraisers, Inc. (Naples, FL) 10%
DirectLine Technologies, Inc. (Modesto, CA) 9.1%
Integral Resources (Cambridge, MA) 8.4%
Bee LC (McLean, VA) 8.2%
George Carden Circus International (Springfield, MA) 2%
Among the other significant findings of the Attorney General's report are:
- In only 42 of the 607 campaigns did the charity retain at least 65 percent of the money raised, the amount that is deemed to be acceptable by the Better Business Bureau's standards for charitable organizations.
- In more than 78 percent of the campaigns the charities kept less than half of the funds raised; and
- Twenty-five charities actually lost money under their fundraising contracts.
This year's Pennies for Charity report contains an additional table which is the result of a recent change in State Law. This modification cancels the registration of charitable organizations failing to file financial reports for 2001. Forty-five organizations have had their registrations canceled as a matter of law and are no longer authorized to solicit contributions from New Yorkers.
The Attorney General's web site, http://www.charitiesnys.com, contains an electronic copy of the report. The information contained in the Attorney General's report pertains solely to telemarketing campaigns conducted by charitable organizations registered to solicit contributions in New York.For Adobe PDF files you can download Adobe Reader from Adobe Systems.