Clothing Donation Bins - Donor Beware

Clothing Donation Bins - Donor Beware

In recent years, clothing donation bins have proliferated across Michigan. Their near omnipresence makes them convenient. But not all of these bins support charity. And even bins that bear a charity's name may not support the charity in the way you think. So before donating your clothes into one of these bins, it's worth learning how these bins are operated.

Bin Operation in General

Many clothing donation bins are operated by for-profit recycling companies. Often, the recycling company agrees to do all the work of maintaining the bin. This usually entails regularly emptying the bin, discarding unusable clothing, and selling the remaining clothing on a per pound basis; in exchange, the charity receives a portion of the proceeds from the clothes. In other instances, a charity may simply license the use of its name to a bin operator in exchange for a cash payment. In still other instances, a charity may actually receive the clothing placed in the bin--perhaps for donation directly to the poor or for resale in the charity's thrift store.

Legal Requirements and Abuses

The operation of clothing donation bins is subject to Michigan's Charitable Organizations and Solicitations Act. Under this law, generally, bin operators must be licensed with the Attorney General and file their contracts with the Attorney General. The law also prohibits misrepresentations and requires certain disclosures.

Of course, the legal requirements for bin operators do not ensure that a particular bin operator is compliant with those requirements. Before donating, donors should review a bin's disclosures. If there are doubts about the accuracy of those disclosures, an inquiry or complaint to the Attorney General could help to allay those doubts; it also may assist the Attorney General in enforcing the requirements for clothing donation bins.

Consumers may contact the Attorney General's Charitable Trust Section at:

In 2017, the Attorney General successfully enforced Michigan law against a Detroit-area clothing donation bin operator. In 2018, the Attorney General successfully resolved a lawsuit against a Texas-based clothing donation bin operator.

Conclusion

Clothing donation bins can be a worthwhile receptacle for your used clothing. But donors should also understand how these bins operate in general and beware of abuses.