Charities or charitable
organizations as they are often referred to, are governed by a
fairly consistent set of laws throughout the United States with
some charity regulations being national and others being state
charity statutes. While charity regulations in your state
may be slightly more or less, you can assume that most charitable
must operate under these basic set of rules.
A charity fundraiser is a person or organization that contracts with a
charitable organization to raise money. Sometimes the
charity fundraisers will use volunteers and only take what is
necessary to cover costs. At the far extreme on the other
end, other charity fundraisers will take a large percentage of
contributions, up to 90% in some cases.
Many charity fundraisers are actually for-profit companies. Fundraisers, like charities, must be registered with the Secretary of
State in most states. Their actions are regulated and if
they operate outside charity regulations, the charity fundraiser
may be shut down. In other words, charities cannot operate
outside the law by hiring an outside charity fundraiser organization.
The Secretary of State in most
states maintains a registry of all charitable organizations,
charity fundraisers and charitable trusts. It is unlawful for most organizations to solicit contributions without being registered.
The charity registry can provide
valuable information, such as: total dollar value of support received by the
charitable organization; total dollar amount applied to charitable
purposes, fundraising costs and other expenses; and the total revenue of the preceding fiscal year.
You can contact your Secretary of State in all 50 states regarding
any charitable organization, and often find out a lot of
information about the charity that they do not otherwise
release. However, the Secretary of State for any state cannot endorse any
organization or give you any kind of personal opinion. Registration
with the state as a charity is not a guarantee against charity deception.
If you are involved in a dispute with a
charitable organization or
a commercial fundraiser, you may wish to pursue one of the following options:
- The Consumer Resource Center, Office of the Attorney General, offers mediation services;
- Ask the organization to resolve the dispute through arbitration or mediation (for example, the Better Business Bureau or a dispute resolution center);
- Pursue the case through Small Claims Court (if your claim is less than $4,000);
- or Consult an attorney for further options.
Most states say that a violation
of their charitable solicitations laws is also violates consumer
protection acts as well. This means the consumer can sometimes recover up to three times the amount of damages (up to $10,000) in a successful court action.
In most states, an individual soliciting a contribution must:
- Clearly state her or his name;
- Clearly state the name of the charitable organization and its principal place of business;
- Clearly state the name of the commercial fundraiser, if any, that employs the solicitor;
- Disclose the true nature of the organization's relationship to the government, if it is associated with or has a name similar to a government organization;
- And, upon request, state the published number of the Secretary of State
or other governing authority.
An individual soliciting a contribution must not:
- Make a false, deceptive or misleading representation;
- State or imply that the contribution is tax deductible unless the charity has filed with the Secretary of State its letter from the Internal Revenue Service granting tax deductible status;
- Give you tax advice or state
that your contributions will be tax deductible for you. They
may however, state that they are registered as a
tax-deductible charity if they are.
- Use the name "police, "sheriff", "fire fighter" or similar name unless authorized;
- Harass, intimidate or torment;
- Call before 8:00 a.m. or after 9:00 p.m. according
to your local time. Calling outside those hours is
You should also know that even if
your name is on the U.S. Government DO NOT CALL registry, this
does not apply to charitable organizations. However, they
must keep their own internal DO NOT CALL registry and if you tell
them to not call you, they must put you on that registry and abide
by your wishes.
Protect your charitable
Charities depend on their ability
to contact the public and solicit contributions. They come to our doors, call us on the phone, or write us in the mail.
Recently, charitable organizations have also discovered email and
regularly keep in touch with their patrons in this less expensive
Unfortunately, not all fundraisers are
reputable and legitimate. Some may use questionable fundraising
tactics. Some may misrepresent themselves, their charity, or what
they do. A few may simply be out to scam you. To protect yourself and to make sure the money you choose to donate goes to a reputable cause, read
and follow these general guidelines and suggestions.
Listen to what they say
When contacted by a charitable organization
that asks you for contributions, listen carefully to what they tell you. Make sure you learn the name of the person to whom you are speaking, as well as the name and address of the
charity; whether the organization is raising money for itself or if it is a fundraiser hired to solicit
charitable contributions; and whether the donation is tax deductible.
Make sure that you understand the
name of the organization and determine if it is the one that you
are thinking of. There are organizations that will create
sound-alike charity names to confuse the public, take advantage of
the good work and reputation of another organization, and bleed
off funds that would have otherwise gone to the organization that
has the good name.
Ask questions about the charity
Before making any financial
charitable contribution, make sure you ask what the funds are used
for and how much of it goes to that cause. Find out if the person to whom you are speaking takes a
percentage of the contribution, and if they do, how large a percentage. Ask what programs the organization has supported recently and where they are located. If the solicitor comes door-to-door, ask for identification and written information about the charity. If the solicitor calls on the phone, ask for a brochure
on the charity to be sent to your home.
Legitimate charities should welcome your questions. They want people to know what they are doing for the community.
They also want to do their part to make sure that other scam
organizations are not taking advantage of their good reputation.
Learn about the charity
Take time to find out about the
charity before you contribute. You don't have to donate right away, and pressure to do so should make you suspicious. Read the brochures provided by the organization at your own pace.
Call the charity directly if you
have questions about whether the solicitor actually represents the
organization or if you think that they are misrepresenting or
damaging the credibility or reputation of the organization.
Call the beneficiaries of the charitable funds - local schools, shelters, workshops, etc. Find out whether they are aware of the solicitation and have authorized the use of their names.
Call your state Secretary of State's office to find out if the charity and its fundraiser are registered and for further information.
When you are satisfied
When you have decided to donate, write a check and make the check payable to the charity, not the fundraiser. Do not send or give cash and do not give a credit card number to anyone over the phone.
Charities will try to get you to give them your credit card number
because so many people will back out on their commitment to donate
and because it's is easier. But when you are talking to
someone over the phone, you cannot be assured that they will only
use this information for the purposes that it was intended.
Remember to save all your records such as cancelled checks or billing
statements where you have made charitable donations. They will be essential if you ever have to file a
complaint and/or when you file your taxes.
The old adage "if it sounds too good to be true, it probably is," applies to dealing with charities as well. Here are some warnings:
Don't be fooled by a name. Some phone charities, including for-profit companies, have sympathetic sounding names, or names that closely resemble those of respected, legitimate charities.
Don't fall for a "sob story." The hard luck tale is a favorite ploy of the phony
charity operator. A legitimate charity will tell you how it is using your money to make a difference for the better.
Don't give in to pressure.
They've done without your contribution till this point and whether
you give them your donation today or next week won't make any
difference. Tell the solicitor you want to take time to make your decision. If
they argue, reconsider your decision anyway.
Don't pay by cash. Pay by check and make it out to the charity (using its full name, not initials),
and most certainly not to the fundraiser. Making a check out
Never give your credit card number to a fundraiser over the phone. If the fundraiser comes to your door, always ask for identification. Alternatively, you can mail your check directly to the charity.
If you receive unordered items in the mail, don't feel obligated to make a donation. It's against the law to demand payment for unordered
merchandise and frankly, they cannot demand that you send it
back. By all legal terms, they have given you a gift.
Legitimate charities do not use this tactic and if enough people
keep the unordered items, they won't be in business for very
Selling tickets for concerts and sporting events can be a good fundraising tool. Just remember most of the money may go to the fundraiser and to pay expenses.
At best, only the profits will go to the charity and perhaps 90%
of the donation will go towards the cost of the tickets.
Be wary of charities that offer to send a courier over immediately to collect your money.
This is sure sign that you are being taken advantage of.
Real charities do not operate this way and therefore, they don't
use any courier service. Phony charities use this practice
because they are worried that you will think about it or realize
that they are not what they profess to be.
Be wary of sweepstakes and contests posing as charities. You do not have to donate for a chance to win.
Stay away from charities that
tell you you can buy a product and take the entire cost of it as a
charitable donation. While some people do this, it is
illegal and if you get caught, you can cause yourself some
problems. Even if it is a legal charity, when you get
something of value for your donation, you cannot take the entire
donation as a deduction. Charities know this and won't tell
you that you can buy their product and take it as a charitable
Get involved with your
There really is no better way to be certain that the charitable organization asking for your support is deserving than to become involved.
Speak to the organizers.
Talk to them about what your talents are and see if you can
help. Charities need grunt labor all the way up to
professional services. Such services can be expensive and
use up valuable donated funds. If you are a professional,
your services may cost you little but be of tremendous value to
the charity. If your staff has extra time that they would
not use productively, consider donating that paid time. You
are paying for it anyway, but by donating it, you can benefit the
Participate in events and donate
your time to the charity. Almost every charity can use
additional help from time to time.
Contribute directly to these charities, and you can be sure your money will be doing the most good.
These pages are created to inform and educate the public only.
They are not and should not be considered legal opinions or
advice. You do not and cannot have any client-attorney
relationship with SeniorMag or any of its employees. You
should not act upon legal advice found on SeniorMag and are advised
to seek professional counsel before taking any action based upon
information found on this site.