Report: Your Charitable Donation Is Going to Telemarketers, Not Charity

Shutterstock/1stclassphoto

Fight disinformation: Sign up for the free Mother Jones Daily newsletter and follow the news that matters.


‘Tis the season to give to charity. But a new report from New York Attorney General Eric Schneiderman finds that many of the donations New Yorkers are giving to charity are mostly going to line the pockets of telemarketing firms. The report found that more than 60 cents of every dollar raised by a professional telemarketing firm for charity goes to the firm itself. Out of 602 fundraising efforts examined, only 49 returned more than 65 percent of the money raised to the nonprofit. More than a third of the fundraising attempts returned less than 30 percent of the donor money to the charity, and in 76 of the campaigns, charities actually lost money hiring the telemarketers. Schneiderman has issued subpoenas to some of the entities in the report in an investigation into whether repeat offenders are breaking New York fundraising laws with their money-losing telemarketing schemes.

Consumer advocates have been saying for years that a lot of charitable fundraising doesn’t go to the needy. But the New York AG’s report comes at an interesting time, when Congress and the president have been discussing whether limiting the $50 billion in annual tax deductions Americans claim for charitable donations is a good way to shore up the nation’s finances. Nonprofit groups have risen up en mass to oppose the idea, but the AG’s report shows that despite claims by conservatives, the private sector is not especially efficient when it comes to serving the less fortunate. And since many of the beneficiaries of charitable donations (the telemarketers) are not even nonprofits, it’s not clear why such donations are tax-deductible in the first place.

Among the worst offenders on the AG’s list are some familiar organizations, many of which are politically involved. Among them is Tea Party Patriots, a group that has long had unusually high administrative and fundraising costs. Schneiderman found that in 2011, Tea Party Patriots, one of the largest grassroots tea party organizations to have come out of the movement, collected nearly $2 million in donations through telemarketers. Just $54,000 of that—less than 5 percent—went back to the organization. The telemarketers kept the rest. Also, it seems that tea partiers are good at promising telemarketers they’ll donate, but not so good about actually paying up. The report shows that Tea Party Patriots had $850,000 in pledges that went uncollected. For an organization that promotes fiscal responsibility, it’s not setting an especially good example.

(Note to conservative activists: If you’re looking to give to a tea party group over the phone, you’re probably best off giving to FreedomWorks, which was until recently run by a professional lobbyist and former member of Congress. FreedomWorks was one of the few groups examined by New York that got 65 percent of the money it raised through telemarketers. Of course, what it did with that money is another issue.)

The Family Research Council Action, Americans United for Life (an anti-abortion group), Ralph Reed’s Faith and Freedom Coalition, and the Concerned Women of America Legislative Action Committee, which ended up nearly $175,000 in the hole from one of its fundraising efforts, all had pretty bad records. But more liberal groups weren’t that much better. NARAL, the ACLU, and People for the American Way all ended up at the bottom of the report: their telemarketing efforts ended up costing them more than they made. It’s all just one more reason to hang up on telemarketers and send your donations through the mail. 

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

AN IMPORTANT UPDATE

We’re falling behind our online fundraising goals and we can’t sustain coming up short on donations month after month. Perhaps you’ve heard? It is impossibly hard in the news business right now, with layoffs intensifying and fancy new startups and funding going kaput.

The crisis facing journalism and democracy isn’t going away anytime soon. And neither is Mother Jones, our readers, or our unique way of doing in-depth reporting that exists to bring about change.

Which is exactly why, despite the challenges we face, we just took a big gulp and joined forces with the Center for Investigative Reporting, a team of ace journalists who create the amazing podcast and public radio show Reveal.

If you can part with even just a few bucks, please help us pick up the pace of donations. We simply can’t afford to keep falling behind on our fundraising targets month after month.

Editor-in-Chief Clara Jeffery said it well to our team recently, and that team 100 percent includes readers like you who make it all possible: “This is a year to prove that we can pull off this merger, grow our audiences and impact, attract more funding and keep growing. More broadly, it’s a year when the very future of both journalism and democracy is on the line. We have to go for every important story, every reader/listener/viewer, and leave it all on the field. I’m very proud of all the hard work that’s gotten us to this moment, and confident that we can meet it.”

Let’s do this. If you can right now, please support Mother Jones and investigative journalism with an urgently needed donation today.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate