Charities Deceive Donors Unaware Money Goes to a Telemarketer
By David Evans - Sep 12, 2012 12:00 AM ET
Bloomberg Markets Magazine
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David Evans on Deceptive Fund Raising Practices
Carol Patterson was waiting for a call from her doctor. When the phone rang on that afternoon in August 2011 at her home in Cortland, Ohio, it wasn’t a physician on the other end. A woman named Robin said she was representing the American Diabetes Association.
Enlarge image InfoCision phone room
InfoCision telemarketers at work in one of the company's Ohio offices.
Ken Berger on Questionable Fund Raising Practices
2:56
Sept. 12 (Bloomberg) - Ken Berger, chief executive officer of Charity Navigator, a free charity ratings company, talks about questionable solicitation practices used by telemarketing firms contracted by charities. Duping the Donors is a featured article in the October issue of Bloomberg Markets magazine. (Source: Bloomberg)
Enlarge image Carol Patterson
Carol Patterson says she feels betrayed by the American Diabetes Association after learning that just 22 percent of the money she helped raised went to the group. Photographed at her home in Ohio, August 2012. Photographer: Grant Cornett/ Bloomberg Markets via Bloomberg
Enlarge image Naomi Levine
NYU's Naomi Levine says it's inexcusable for charities to deceive people who may donate. Photographed at her home in New York, August, 2012. Photographer: Grant Cornett/ Bloomberg Markets via Bloomberg.
Enlarge image The ADA's contract with InfoCision
Larry Hausner, the American Diabetes Association’s CEO, signed this contract for the association’s 2011 volunteer fundraising campaign with InfoCision. Hauser’s signature is just inches below the telemarketer’s estimate that it will be paid $3.9 million of the $4.6 million in expected revenue. That’s 85 percent of the money to be raised. Source: American Diabetes Association’s 2011 contract with InfoCision (page 22 of 35)
Enlarge image InfoCision script on behalf of the ADA
This 2010 script used by InfoCision to recruit volunteers to raise money for the American Diabetes Association instructs solicitors to tell the people they call that “overall, about 75% of every dollar received goes directly to serving people with diabetes and their families, through programs and research. The other 25% goes to program management.” Actually, in 2010, most of the money that InfoCision raised for the association went to the telemarketing company. Source: InfoCision’s script (page 29 of 38) on behalf of the American Diabetes Association
Enlarge image InfoCision script on behalf of the ACS
Caption: When asked about the “money breakdown,” InfoCision’s telemarketers were instructed to tell prospective Notes to Neighbors program volunteers that “overall, about 70 cents of every dollar received goes to the programs and services we provide.” Actually, the majority of the money raised for the American Cancer Society by InfoCision went to the telemarketing company. Source: InfoCision’s script (page 27 of 33) on behalf of the American CancerSociety
Enlarge image InfoCision's tips for scriptwriting success
“It really doesn’t matter if you’re selling a children’s charity, a political appeal or a miracle diet plan.” InfoCision describes its expertise in composing fundraising scripts with emotional triggers that appeal to sympathy, fear, anger and guilt. Source: An InfoCision document (page 1 of 2) titled "Four Easy Steps to Scriptwriting Success"
Enlarge image The American Cancer Society's 2010 Maine fundraising report
Caption: This annual fundraising report, filed by the American Cancer Society and signed by Chief Financial Officer Catherine Mickle on Nov. 1, 2011, shows that the “total dollar amount retained” by Akron, Ohio-based InfoCision exceeded the “total dollar amount raised from contributions.” Source: American Cancer Society’s 2010 Annual Fundraising Activity Report (pages 1 and 2 of 5) filed with Maine
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Robin didn’t ask for money. She asked Patterson to stamp and mail pre-printed fundraising letters to 15 neighbors. Both of Patterson’s parents and one grandmother had been diabetic, so she agreed to do it, Bloomberg Markets magazine reports in its October issue.
“I thought since it does run in the family, it wouldn’t hurt for me to help,” says Patterson, 64, a retired elementary school teacher. She guessed, based on what she knew about charity fundraising, that about 70 to 80 percent of the money she brought in would be used for diabetes research.
The truth was almost the exact opposite. The vast majority of funds Patterson, her neighbors and people like them throughout the country would raise -- almost 80 percent -- would never be made available to the Diabetes Association. Instead, that money collected from letters sent to neighbors would go to the company that employed Robin and an army of other paid telephone solicitors: InfoCision Management Corp.
Just 22 percent of the funds the association raised in 2011 from the nationwide neighbor-to-neighbor program went to the charity, according to a report on its national fundraising that InfoCision filed with North Carolina regulators.
‘Terribly Wrong’
“It’s like a betrayal,” Patterson says, sitting in her kitchen in June, after being shown copies of the North Carolina report and the contract the association signed with InfoCision. “I know I won’t donate again. It’s like they stabbed you in the back. It’s terribly wrong.”
And it gets worse. Many of the biggest-name charities in the U.S. have signed similarly one-sided contracts with telemarketers during the past decade. The American Cancer Society, the largest health charity in the U.S., enlisted InfoCision from 1999 to 2011 to raise money.
In fiscal 2010, InfoCision gathered $5.3 million for the society. Hundreds of thousands of volunteers took part, but none of that money -- not one penny -- went to fund cancer research or help patients, according to the society’s filing with the U.S. Internal Revenue Service and the state of Maine.
Fees Added
Every bit of it went to InfoCision, the filings say. The society actually lost money on the program that year, according to its filings. InfoCision got to keep 100 percent of the funds it raised, plus $113,006 in fees from the society, government filings show.
Major charities compound the deception by encouraging telephone solicitors to lie. InfoCision scripts approved by both the Diabetes Association and the Cancer Society for what the telemarketer calls neighbor-to-neighbor campaigns in 2010 instruct solicitors to say, when asked, that at least 70 percent of the money raised will be used for charitable purposes.
Yet in contracts with InfoCision in that very same year, the association and society said they expected that the telemarketing firm would keep more than 50 percent of all the funds it collected.
Altogether, more than 5 million Americans volunteered to raise money for these two groups -- and other charities that hired InfoCision -- from their neighbors since 2005 after being pitched by solicitors using charity-approved scripts, according to state regulatory filings.
‘False Pretenses’
Charities should be held accountable for deceptive fundraising done in their name, says James Cox, a professor at the Duke University School of Law in Durham, North Carolina, and co-author of “Cox and Hazen on Corporations” (Aspen Publishers, 2003).
“If that’s what they do systematically, then they’re obtaining money under false pretenses,” he says. “I don’t just think it’s incredible. I’d be surprised if it isn’t criminal.”
Naomi Levine, chair and executive director of the George H. Heyman Jr. Center for Philanthropy and Fundraising at New York University, says charities are knowingly being dishonest.
“I’m amazed at that,” she says. “I didn’t know about it. It’s deceitful.” Levine, 89, was a nonprofit fundraiser for three decades, bringing in more than $2 billion for NYU.
“Even for them to engage in a program like that is shocking to me,” she says. “And I’m in the field. So how can you expect donors to know that?”
Richard Erb, vice president of membership and direct marketing at the Alexandria, Virginia-based Diabetes Association, defends his group’s practices.
‘A Dime’
“If we came into it and said, ‘Geez, I’m not going to make a dime on this,’ do you think we would have anyone who would give us money?”
Greg Donaldson, a senior vice president at the Atlanta- based Cancer Society likens telemarketing campaigns that net the charity low percentages of donations to retailers pricing a product below cost to lure shoppers.
“It’s certainly not inconsistent for organizations like ours to invest in some loss-leader strategies, to engage people in long-term meaningful relationships,” he says.
In the past decade, many of the nation’s biggest health charities have hired InfoCision, including the American Heart Association, American Lung Association, American Society for the Prevention of Cruelty to Animals, March of Dimes Foundation and National Multiple Sclerosis Society.
Overall, InfoCision brought in a total of $424.5 million for more than 30 nonprofits from 2007 to 2010, keeping $220.6 million, or 52 percent, according to state-filed records.
Evangelical Preachers
InfoCision, which is based in Bath Township, Ohio, near Akron, says on its website that it raises more money for nonprofits than any other telemarketer in the world. The privately held company was founded by Gary Taylor, who got his start raising money for evangelical preachers.
InfoCision, which isn’t required to and doesn’t disclose revenue or profit, also does marketing for corporate clients such as Time Warner Cable Inc. (TWC) and Verizon Communications Inc. (VZ) The company has a political operation as well.
It did fundraising for Citizens United, the conservative group best known as the plaintiff in the Supreme Court case that allowed unlimited independent spending by corporations and unions on behalf of political candidates. From 2009 to 2011, InfoCision raised $14.7 million for Citizens United.
The telemarketer was as stingy with Citizens United as it was with some of the charities: It kept $12.4 million, or 84 percent, of the money it raised for Citizens United, according to InfoCision filings with North Carolina. InfoCision has also worked for the National Republican Congressional Committee.
$115 Million
rest in link
and you right it seems to be the one disease they aint tried nothing new with
but if you got a certain cancer that speads and it reaches stage 4 kiss yo ass goodbye nikka
