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Look Before You Give: Paid Fundraisers Enjoy Greatest Benefit From Many Charitable Donations

CONTACT: William H. Sorrell, Attorney General, (802) 828-3173

With the arrival of the holiday season, Vermonters’ spirit of generosity is getting into full swing, especially in the form of charitable giving. Most Vermonters, however, are unaware that when certain fundraising techniques are used, much of their donation may go to a third-party and not to the charity of their choice. Many donations made through paid fundraisers – companies hired to solicit charitable donations – result in only a small fraction of the gift going to the chosen cause: roughly 25% for gifts to Vermont-based charities.

“Once again, as we all look to help those in need or give to a favorite cause,” Vermont Attorney General Bill Sorrell said, “Vermonters should be aware when they make donations through a paid fundraiser, most likely the bulk of their gift is going to a different company – not the cause they want to support. Be informed. Ask questions. Ensure that your generosity can have its maximum impact.”

The Attorney General’s Office registers all paid fundraisers that run solicitation campaigns in Vermont and requires them to file an annual financial report for each campaign. The report lists the total donations received from Vermonters, how the donated dollars are divided between the charity and the fundraiser, and the expenses claimed by the fundraiser.
Based on data from the 389 reports filed for campaigns conducted between July 1, 2012, and June 30, 2013, paid fundraisers raised over $3.1 Million from Vermonters, but the named charities received only about $860,000 – roughly 22% of the total donations. The 17 Vermont charities that used paid fundraisers during this time period received only $433,860 from the over $1.7 Million raised on their behalf – a quarter out of every dollar given.

As with previous years, a few paid fundraisers continue to dominate in Vermont. Though 12 paid fundraisers ran 27 campaigns in Vermont, nearly 75% of the total money raised for Vermont causes went to four charities and their paid fundraisers:

Charity Name Paid Fundraiser (PF) Total Raised Total to Charity % to Charity Goods/Svs Expenses Net To PF

Prof. Fire Fighters of Vermont FireCo (two campaigns) $629,761 $134,757 21.40% $411,104 $83,900

Vermont Police Association Xentel $193,911 $36,843 19.00% $0 $157,068

Special Olympics Vermont The Heritage Company $131,966 $65,983 50.00% $0 $65,983

Vermont Police Association Police Publications $113,142 $27,154 24.00% $72,708 $13,280

Special Olympics Vermont DialAmerica Marketing $107,577 $14,948 13.89% $92,629 $0

Vermont Troopers' Association Police Publications $99,796 $25,759 25.81% $61,038 $12,999

Though four of these campaigns involved the sale of goods or services – for example magazines or concert tickets – the bottom line for the donor’s dollar remains the same: in most instances, less than a quarter of the total donation goes to the charity for charitable purposes.

“Vermont causes are worthy causes, and donors should feel good about supporting the charities of their choice,” Attorney General Sorrell said. “But information is vital whenever you hand over money, and donors should be fully informed before making any gift.”

The Attorney General’s Office urges Vermonters to:

  • Ask all solicitors to explain what portion of a donation goes to support charitable programming and what portion goes to fundraising. Though paid fundraisers are not legally required to answer, they must inform prospective donors about where to find such information (see next bullet).

  • Check the breakdown of contributions between fundraisers and charities on the Attorney General’s website: at www.atg.state.vt.us/issues/consumer-protection/charities.php.

  • Ensure that those soliciting money over the phone, through mail, or via the internet clearly identify themselves and their employer.

  • Report any concerns regarding paid fundraisers to the Vermont Attorney General’s Consumer Assistance Program, 146 University Place, Burlington, VT 05405, or call (800) 649-2424; (802) 656-3183 within Chittenden County.

    Follow the Vermont Attorney General’s Office on Facebook: facebook.com/VermontAttorneyGeneral and Twitter: @VTAttorneyGen

  •   Website consulting provided by The National Association of Attorneys General.