State AG: Charity Telemarketers Keeping Lion's Share of Donations

Annual “Pennies for Charity” fundraising report says the bulk of donations are going to telemarketers and not those in need.

Telemarketers running fundraising campaigns for charities in New York keep an average of 62 cents of every dollar they raise for themselves, according to a new report released Thursday by State Attorney General Eric Schneiderman. 

In half of the fundraising campaigns run by for-profit telemarketers, the charities retained less than 30 percent of the funds raised, according to Schneiderman's annual “Pennies for Charity” fundraising report. In 91 campaigns, telemarketers were actually paid more than the amount that the individual charities received, the report says. 

A portion of the donations covered by the report were made to charities related to Hurricane Sandy relief and aid to the victims of the Sandy Hook shooting. 

Telemarketers registered in New York reported raising more than $249 million in contributions in 2012, but more than $154 million of that amount that was intended to help those in need instead went to cover the telemarketers' fees and expenses, the report says. 

“New Yorkers who open their hearts and wallets deserve to know how their hard-earned dollars are being spent and how much of their money is going to pay telemarketers’ salaries and costs,” Schneiderman said. “Our annual report aims to help New Yorkers maximize the benefits of their donations by showing how much really goes to charity, versus how much remains in the pockets of fundraisers.”

In 459 of the 589 (78 percent) campaigns analyzed in the report, the charities retained less than 50 percent of the funds raised.

Statewide, the rate of return was lowest for donations solicited in Nassau and Suffolk counties, the report says. 

In Suffolk, for example, $117,630 was collected for the Suffolk County Police Memorial Fund in 2012, but just 40 percent of that amount–$47,052–went to the fund itself, the report says. The rest went to the telemarketer, Holbrook-based D & D Telemarketing. 

In Nassau, Campaign Center Inc., based in Lindenhurst, collected $148,280 on behalf of the Nassau County Council Veterans of Foreign Wars. Of that total, just 20 percent–or $29,656–went to the charity, the report says. 

Last year, following the release of the 2012 "Pennies for Charity" report, Schneiderman served subpoenas and launched several investigations focusing on fundraising campaigns that repeatedly result in little or no money going to charities. So far, the office has shut down three charities and one fundraiser. Additional investigations are expected to result from this year’s report.

Read the entire report here

Schneiderman issued the following tips when making donations via phone solicitation:

Resist Pressure To Give On The Spot. If you receive a call from a telemarketer, do not feel pressured to give over the phone. You can ask to receive information about the cause and a solicitation by mail.

Ask The Telemarketer. Ask the caller what programs are conducted by the charity, how much of your donation will be used for charitable programs, how much the telemarketer is being paid and how much of your donation the charity is guaranteed.

Ask How Your Donation Will Be Used. Ask specifically how the charity plans to use your donation, including the services and organizations your donation will support. Avoid charities that make emotional appeals and are vague in answering your questions. Be wary if an organization will not provide written information about its charitable programs and finances upon request. Any legitimate organization will be glad to send you this information.

Look Up Charities. Review information about the charity before you give. The Attorney General’s interactive website allows potential donors to easily search the "Pennies for Charity" report by the name of the charity or by region in New York State. (A link to the search tool can be found on the Attorney General’s charities website at www.charitiesnys.com.) Users can also see how much money was raised by a professional fundraiser and how much money actually went to each charitable organization. Also confirm that the charity is eligible to receive tax-deductible donations by searching the IRS website at www.irs.gov.

Give To Established Charities. Donate to organizations you are familiar with or ones with a verifiable record of success in meeting their charitable missions. Closely examine charities with names similar to more established organizations.

Never Give Cash. It's best to give your contribution by check made payable directly to the charity. This is safer than giving by credit or debit card and far safer than sending cash. Be careful about disclosing personal or financial information; never give out such information to an organization or individual you don't know.

Report Suspicious Organizations. If you believe an organization is misrepresenting its work, or that a scam is taking place, please contact the Attorney General’s Charities Bureau at charities.bureau@ag.ny.gov or (212) 416 8401.

GLENN March 01, 2014 at 02:20 PM
I love when they call and ask for money, I just keep asking them a hundred questions, they get so fed up we get disconnected most of the time. I only give to the wounded worrier project. Nothing to any other scam charity ever!
Vincent March 02, 2014 at 06:55 AM
knee jerk: reaction?
knee jerk March 02, 2014 at 07:22 AM
Vincent?: OK I don't answer ,then use the caller id # to call them back. If a live person answers I berate them- nicely. The other method is I have a childs' toy musical horn that plays various barnyard animal sounds like a cow or pig or chicken or duck or sheep. When a live person is on the other end I play those animal sounds into the phone until they hang up.
TJ Eckleburg March 02, 2014 at 03:48 PM
Knee, you obviously have way too much time on your hands
knee jerk March 12, 2014 at 09:46 AM
Hey, TJ: Yes I do, but I use it wisely.


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