Saturday, April 5th, 2008
Be generous but beware
Make sure your donations count
By Shelley Grieshop
Professional solicitors may come knocking at your door, as well as contacting vi. . .
The phone rings and a pleasant voice pleads for money.
Cancer research, law enforcement, children with disabilities - it doesn't matter what the cause. Our hearts are touched and our pocketbooks open without knowing just how much - if any - of our money is actually going where we intended.
"The people of Mercer County are very generous and contribute money quickly and without question," Mercer County Sheriff Jeff Grey said. "The sad fact is, most phone solicitations are from a professional solicitor who receives a large percentage of the money you contribute."
Professional solicitors negotiate a price per job with charitable organizations and often get a negotiated percent of the donations, said Monica Moloney, assistant chief of the charitable law section of the Ohio Attorney General's Office. There are no limits, guidelines or laws governing those contracts because, by law, states cannot set percentages for how much charitable organizations spend on solicitors or retain for operations, she said.
"The issue goes back to a trio of Supreme Court cases in the 80s," Moloney explained.
The argument at the time was that dictating how much charities keep and spend would have a "chilling affect" on free speech and was deemed a violation of the First and 14th Amendments, she said.
In 2005 (the latest figures available from the state), $521.8 million was raised by professional solicitors for Ohio charities. Of that total, 66 percent was kept by the charities and the remaining paid to solicitors.
According to a 2005 report by the Ohio Attorney General's Office, numerous charities were found to have retained less than 50 percent of the funds they raised. For example, a fundraiser performed on behalf of Central Ohio Police Officer Training netted the organization just 26.5 percent of the $209,000 raised.
In 2005, the Grand Lake Fraternal Order of Police (FOP), based in Celina, raised nearly $32,000 during its annual telemarketing fundraiser. The cost to hire a professional company to perform the solicitations - about $22,400 or 70 percent of the money raised.
"At one time we considered doing it ourselves, but like other charitable organizations, you find out there are only so many people willing to do the work," said former Mercer County Sheriff Paul Gray, who served as treasurer for the local FOP in 2005.
It's the price of doing business if you want to raise money, Gray added.
Still, some charitable organizations manage to keep a majority of their donations such as the March of Dimes, which pocketed 93.3 percent of their donations during a 2005-2006 campaign.
Solicitors serve a purpose for organizations that need them, Moloney said. Most are required by law to be registered with the attorney general's office. They also have a responsibility to properly represent the charity they are working for and must be able to answer questions about the organization if asked by potential donors, she added.
"We urge the public to ask the questions: How much money did the charity retain last year? How much did they spend on soliciting? If you're satisfied that they only kept 5 percent of what they raised last year, great. If not, don't feel guilty about saying no," Moloney said.
If a solicitor is pushy, abusive, offers to pick up your donation or gives you information about the charity that you find out later is false, contact the attorney general's office, she advised.
"That's fraud, she said.
The state agency encourages the public to log onto www.guidestar.org to find financial audit information on charities across the state. The site contains IRS-filed documents on charitable organizations; many are free to view and download. Some of the data available on the Web site details how the charitable organizations spent their donated funds.
Charities will always need our support but the public needs to be cautious, Grey added.
"People need to be aware and not be so quick to open their checkbooks," he said. "If in doubt, say no and hang up."
Tips for donating money to charity:
The U.S. Attorney General's Office offers the following tips for consumers to follow before donating to charities:
• Ask the solicitor where the charity is physically located (city and state).
• Ask what specific programs and services the charity helps.
• Ask what percentage of your donation will support the cause described in the solicitation.
• Ask what percentage of the charity's annual income is spent on administrative expenses and fundraising activities.
• Verify - either through the Better Business Bureau, Federal Trade Commission or the Attorney General's Office - that the charity exists and has authorized the solicitation.
• Never provide a credit card or bank information until you have reviewed all the information from the charity and made the decision to donate. Law enforcement agencies advise to never give any personal information to anyone on the phone.
• Ask for a receipt showing the amount of the contribution and stating that it is tax-deductible.
• Avoid giving cash. For security and tax records, it is best to donate by check, made payable to the beneficiary, not the solicitor.
If you suspect charitable fraud, have questions about a charity or professional solicitor or want copies of a charity's registration forms or financial reports call 877-244-6446 or visit the Attorney General's Web site at www.ag.state.oh.us.
- Shelley Grieshop