Schuette Issues Professional Fundraiser Report: Charities See Only 35 Cents for Each Dollar Raised
Joy Yearout 517-373-8060
March 7, 2013
General Bill Schuette today announced the publication of Michigan's first annual
Professional Fundraising Charitable Solicitation Report, which found that
charities collect an average of only thirty-five cents for every dollar raised
by professional fundraisers soliciting donations in Michigan.
have generous hearts and deserve to know how much of their donation actually
makes it to their intended charity, especially in these times when every dollar
makes a difference," said Schuette. "Donors might be
surprised to know that, on average, only thirty-five cents of each dollar
collected through professional fundraisers are passed on to the charity.
"This new report
will hold professional fundraisers accountable and make charities more
transparent, so donors can do as much good as possible."
Consumers may access
the report directly at
http://1.usa.gov/15cWQLQ or by visiting the "Charities" section of the
Attorney General's website at www.michigan.gov/AGCharities.
Under Michigan law,
a professional fundraiser is defined as a person or organization that solicits
contributions on behalf of a charity in exchange for compensation. This is
different from a charity that hires its own staff member for development and
other fundraising activities.
requires professional fundraisers to submit the results of their campaigns to
the Attorney General. The data includes the type of appeal conducted (mail,
telephone, etc.), gross receipts raised, the amount paid to the fundraiser, and
the final amount and percentage that went to the charity. Any charity
fundraising in Michigan is required to report these results, so the Professional
Fundraising Charitable Solicitation Report includes data from charities across
the country. The report includes the results of fundraising campaigns reported
to the Attorney General during the 2012 calendar year.
professional fundraisers and fundraising counsel may benefit certain charities,
some professional fundraisers leave little of the donations for the intended
charity. According to data aggregated in the Attorney General's Report, on
average, professional fundraisers pocket 65% of funds raised.
According to the
Better Business Bureau's
Standards for Charity Accountability, charities should "spend no more than
35% of related contributions on fund raising. Related contributions
include donations, legacies, and other gifts received as a result of fund
Schuette noted that
states are limited in their ability to pass laws to regulate professional
fundraisers' solicited contributions. The U.S. Supreme Court ruled
unconstitutional state laws requiring that a minimum percentage of each donation
go to charity in Illinois ex rel. Madigan v. Telemarketing Assocs., 538
U.S. 600 (2003). As a result, states are limited to passing laws that prohibit
fraudulent fundraising practices and require reporting from charities and their
professional fundraisers. Michigan law addresses both aspects.
Schuette added that
examples of fraudulent fundraising practices prohibited by Michigan law include:
(1) falsely telling a donor that he or she gave six months ago and it's time to
give again, or (2) falsely telling a donors that 90% of their donations go to
the charity, when that is in fact not true.
transparency and provide donors greater access to this important information,
Schuette enhanced the Attorney General's online charity search feature to
include professional fundraiser data. The Attorney General's annual
Professional Fundraising Charitable Solicitation Report provides a year-end
compilation of data, while the online charity search feature provides campaign
information as it is filed throughout the year.
The online charity
search is designed as a central resource for prospective donors to perform
general searches for various types of registered charities. For instance,
donors may search by key words within the organization's purpose, as well as by
city, county, state, name, or any combination of these. Inquiring prospective
donors can visit
General's office has the primary responsibility for ensuring charitable assets
are being used for the purpose for which they were donated and that
organizations are acting as responsible stewards of these assets. To fulfill
this mandate, the Attorney General's Charitable Trust Section registers
charitable trusts, licenses charities to solicit funds, monitors charitable
assets, and oversees any changes that may occur in a charitable entity's form or
existence. The Charitable Trust Section also serves as an important repository
of publicly available information about charities, and protects citizens from
illegal scams posing as legitimate charities. For more information on the
Attorney General's oversight of charitable solicitation in Michigan, visit