This week's scathing shower of shame begins with a holiday fable.
Suppose Santa Claus wants to lend Rudolph $1,000 to cover the reindeer's losses at the craps table. So Santa hands his right-hand elf the cash and asks him to bring it to Rudolph.
If the elf were to skim, say, $900 off the top for administrative services rendered, we'd call him a thief and confiscate his pointy shoes--and we'd expect Santa not to trust him again. But faced with the same situation, the Oregon Volunteer Firefighters Association keeps handing donated cash to the wrong people, who in turn keep taking the vast majority for themselves.
OVFA's intentions are great. Its financial instincts are terrible. In this year's fundraising drive, OVFA raised $900,000 from generous Oregonians to aid volunteer firefighters who serve rural areas throughout the state. Thanks to a bum agreement with the telemarketing firm it hired to scare up the cash, though, OVFA only kept $95,740 of the proceeds--or about 11 percent of the take.
The balance, around $800,000, went to the shady New Jersey-based call center Civic Development Group LLC, which raises money on behalf of police and firefighter groups around the nation. (It also shills in Oregon for the Cancer Fund of America, from which it takes 88 percent of donations.)
CDG itself is quite a piece of work. The company's practice of giving just pennies on the donated dollar to the charities it represents has attracted the disdain of attorneys general from New York to California. The Federal Trade Commission even censured the firm for lying to donors, and as recently as early November the company made headlines when one employee repeatedly threatened to send a SWAT team to a Utah woman's door if she didn't reveal her credit-card number.
OVFA president James Oeder did not return the Rogue Desk's calls.
Oregon Department of Justice spokeswoman Victoria Cox says such arrangements are lamentably common.
"If somebody's calling you on the phone for a donation, you should be aware that probably 70 cents of every dollar will go to the telemarketer," she says.
But don't curb your giving out of fear of being hustled. Either seek the right charities out yourself (www.guidestar.org is a good info source) or, if you must give over the phone, just ask what the telemarketer's cut will be. Johnny Law requires them to tell the truth.
Any organization that is willing to allow a fundraising company take over 25% of donations as a fee is probably badly mismanaged, and a bad way to support their cause. At a 90% cut to the company, it becomes an object of derision and concern. Why would an organization be willing to pay such a large percentage to a for-profit firm? A charity that does something as stupid as this probably is mismanaged, and isn't the best place to put your charatable dollars.
Those who've worked at CDG say how good the firm is at fundraising. They are good at getting people to give. They just keep most of the funds for themselves. If the first line they said was "Our company keeps 90% of everything you give, and the charity gets 10%", they wouldn't get any of the dontations.
Perhaps we need a law in Oregon that requires all telemarketers to say what percentage actually goes to the charity they're calling for at the outset of the call.