Telephone solicitations in fundraising campaigns

When fundraisers seek money by telephone, consumers should know how to protect themselves and to ensure that the money they donate is being used wisely.

Ernest McLean, Minister of Government Services and Lands, says: "Consumers should make themselves fully aware of the terms of any solicitation before making a contribution to a fundraising effort.

"Non-profit organizations must also be diligent. When they are approached by a firm proposing to conduct a fundraising campaign on their behalf, they should inquire about all the details before getting involved in any business arrangement."

Charitable and fraternal organizations are not required to be licensed if they are soliciting donations on their own behalf. These types of solicitations are typically carried out by local volunteers.

Professional or third party fundraisers, however, must be licensed by the Trade Practices and Licensing Division of the Department of Government Services and Lands. These fundraisers solicit donations on behalf of a charitable or fraternal organization and receive a fee for doing so, or they solicit donations to cover the cost of a product such as a publication.

In order to ensure that the consumer is able to make an informed decision, the department requires fundraising firms to tell the consumer the name of the fundraising company, the person calling, the name of their client and the amount of money being raised for that client.

There is no provincial regulation which sets out the proportion of the donation which must go to the charity and the proportion which must go to the fundraising firm. The amount of money to be paid to the fundraising company will generally be established by the agreement in place between the client and the fundraising company. People receiving fundraising solicitations should feel free to ask how their donations will be handled and used.

ADVICE TO CONSUMERS

The Department of Government Services and Lands offers the following advice to consumers who receive calls from fundraisers:

- If you are asked to make a contribution to a charity or some other non-profit organization, ask how much of your contribution the charity will actually receive.

- If the donation is in support of a publication which is intended for free distribution, inquire about the details of the magazine, including when it will be available.

- Inquire as to whether an official tax receipt will be issued. Some registered charities issue tax receipts for income tax purposes. If so, be sure to ask if your entire donation will be receipted for tax purposes. Be sure to differentiate between a tax receipt and a regular receipt for a donation.

- Never give cash unless you get a receipt at that time. Especially never send cash in the mail. A cheque made out in the charity's name should ensure that your money goes where it is intended.

- Do not be pressured into donating more money than you wish to give. Some organizations will recommend donations of a specific value, but you are not obliged to agree to that amount. The organization should be willing to accept any donation which you are able to give. Some organizations will send you an information package and a form to complete if you agree to make a donation. However, if you change your mind, you are not under any obligation to make a donation simply because the information is sent to you.

- If you are not sure about the legitimacy of the caller, check with the organization on whose behalf the funds are being raised to find out if they have a fundraising campaign under way.

- If the caller tries to pressure you into making a donation which you do not wish to make, or to donate a higher amount than you offer, be assertive about your position or simply end the conversation.

- If you wish to make a complaint you may contact a consumer affairs officer with the department. If the fundraising is carried out on behalf of a charity, you should also contact the organization for which the campaign is being conducted.

ADVICE TO NON-PROFIT ORGANIZATIONS

The Department of Government Services and Lands offers the following advice to non-profit organizations who enter into contracts with professional or third party fundraisers:

- Ask the company to provide you with a copy of the telephone presentation which will be made by the fundraising firm on behalf of your organization.

- Require full documentation from the professional fundraising company of the expenses and expenditures involved in raising the funds; as well as a full accounting of all receipts and remittances to your organization and the firm with whom you have contracted.

- Put appropriate financial controls in place which will guarantee your interests are properly looked after.

- Remember that a fundraising company will be using the name of your charity or organization to solicit donations. It is important that you are represented in a manner which is acceptable to you and which reflects the integrity and reputation of your organization.

Contact:

Rick Callahan Tony Patey Carol Furlong Director of Communications Director of Practices Supervisor, Trade (709) 729-4860 and Licencing Practices (709) 729-2600 (709) 729-4196