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Trusted Charities Break Donor Trust When It Comes to Donations – Only 22% of Money Makes It

September 12th, 2012 · 5 Comments · Uncategorized

I was watching the Today Show this morning after going for a run and the story I caught floored me. They reported that only 22% of donated money actually makes it to charity when collected by telemarketers. This is backed up in an article on Bloomberg entitled “Charities Deceive Donors Unaware Money Goes to a Telemarketer“. We are not talking mom and pop charities here. We are talking about charities like The American Diabetes Association, The American Cancer Society, and more. If that doesn’t get you, paid employees of the telemarketers have passed themselves off as volunteers and (obviously) don’t disclose exactly how much goes to charity and how much is profit for the telemarketers. But it gets worse. Here is an excerpt from the Bloomberg piece that is outrageous at best,

In fiscal 2010, InfoCision gathered $5.3 million for the society. Hundreds of thousands of volunteers took part, but none of that money — not one penny — went to fund cancer research or help patients, according to the society’s filing with the U.S. Internal Revenue Service and the state of Maine.

Fees Added

Every bit of it went to InfoCision, the filings say. The [American Cancer Society] actually lost money on the program that year, according to its filings. InfoCision got to keep 100 percent of the funds it raised, plus $113,006 in fees from the society, government filings show.

Major charities compound the deception by encouraging telephone solicitors to lie. InfoCision scripts approved by both the Diabetes Association and the Cancer Society for what the telemarketer calls neighbor-to-neighbor campaigns in 2010 instruct solicitors to say, when asked, that at least 70 percent of the money raised will be used for charitable purposes.

Yet in contracts with InfoCision in that very same year, the association and society said they expected that the telemarketing firm would keep more than 50 percent of all the funds it collected.

Altogether, more than 5 million Americans volunteered to raise money for these two groups — and other charities that hired InfoCision — from their neighbors since 2005 after being pitched by solicitors using charity-approved scripts, according to state regulatory filings.

So the American Cancer Society hired a group to collect donations and ended up shelling out $113,000 for some telemarketers to rake in $5 million in “donations” which they kept and added fees to. What is more, according to the Bloomberg article, the charities themselves endorsed and encouraged lying to donors and enlisted the help of thousands of volunteers, who thought they were doing the Society a service. That is crazy. The more I think about it the more upsetting it gets. This is going to hurt some reputations big time and will hopefully lead to more transparent and upfront mandatory disclosures of exactly how much of your donation will go where they say it is going BEFORE you give.

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5 Comments so far ↓

  • Philip Cunningham III

    There are watchdog groups (such as this: who hold charities accountable.

    I enjoyed how you felt the need to offer an explanation for why you were watching the Today Show 🙂

    • mattdabbs

      Missy and I used to watch it all the time but stopped when we had kids. Now when I run in the morning and get back to the house I spend some time cooling down with the TV on for 5-10 minutes and that is all I catch 🙂 Not as bad as saying you were “flipping channels” and saw something on Oprah. Always have to explain that one. At least you used to.

  • Jerry Starling

    Absolutely outrageous!

    Yet, how much of a church’s giving goes to programs beyond building operations and staff, who mostly serve the members? Especially in smaller churches that are struggling to survive. Many mission programs have the missionary coming home frequently to raise money. That expense is also “overhead” that does not go directly to the ministry. But how many churches that sponsor missionaries even calculate these figures?

  • Andrew Patrick

    This is going to hurt some reputations big time and will hopefully lead to more transparent and upfront mandatory disclosures of exactly how much of your donation will go where they say it is going BEFORE you give.

    …. what if they lie while they are disclosing?

  • charities Australia

    Trust is the main thing while donating to a charity and according to Google you’ll find approximately 8000 websites that provide information on Charitable Annuities like charity Australia.

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