Wednesday, June 16, 2010

Most Charities are Good Charities

But a select few are horrible. Really, they're not even charities. They are organizations established under the auspices of charitable giving but they really only serve the people who run them.

Missouri Attorney General Chris Koster recently won a suit against Jeffery Duncan and Kathy Clinkenbeard, both of California, for soliciting in Missouri on behalf of three scam charities: Coalition of Police and Sheriffs, Inc. (COPS), Disabled Firefighters Fund, Inc. (DFF), and American Veterans Relief Foundation, Inc. (AVRF). The AG's office found that less than 5% of the funds raised by these 'charities' went to help the police, firefighters, and veterans they purportedly served.

The BBB's Standard is that no more than 35% of funds raised by an organization be used for fundraising expenses. Additionally, at least 65% of an organization's expenses must be program expenses. All organizations have administrative and fundraising costs - I would strongly question any organization that implies that it doesn't - but those costs must be reasonable.

I hate talking about charity scams because most charities are good organizations run by honest, well-meaning people. As donors, it is prudent that you ask questions of any organization that seeks your financial support. If you receive a solicitation call, you have a right to know if the caller is a professional fundraiser hired by the organization and what percentage of your donation will actually go to the charity. It is not uncommon for professional fundraisers to take 80% or more of the money collected from phone solicitations. You should also know how a charity allocates its expenses among program, administration, and fundraising.

For more information on giving wisely to police and firefighter organizations, check out these BBB tips.

2 comments:

  1. I've taken calls on all those scam organizations. I know what you mean about hating talking about the bad charities. I try to explain as best I can that people should check out every single charity that solicits them, but it makes it sound like I believe there are scammers hiding in every corner. No! It's something safe to do, just in case. It's not to make them paranoid about donating. I'm try my best not to sensationalize the issue.

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  2. The observation that "most charities are good organizations run by honest, well-meaning people" is based upon what?

    I would contend that most charities are self serving organisations that provide excellent salaries for their executive officers. The infra-structure that follows charities into disaster areas is unbelievable. Best hotels, some 5 star, new 4x4 vehicles, leisure and entertainment. Weird accounting practices that make it impossible to determine where the money actually goes.

    Others are just run by well meaning incompetents or worse yet by churches who use charity donations to pay the clergy and build and maintain huge buildings and assets with only a tiny percentage of the money actually going to what could be called the 'good' cause. For most though the good cause is the God cause. Spreading the word of their particular creed to raise more money to spread the word of that creed etc.

    If you want to give to charity find one that you like. Check it out as much as you can and stick with it. But don't just give because an ad on TV or the like has pricked your conscious.

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