Vermont AG Says Paid Fundraisers Keep Much Of The Money They Raise

Dec 8, 2015

A new report from Attorney General Bill Sorrell shows that most of the money raised by professional fundraisers for Vermont charitable groups goes to the fundraiser, not the charities.

Attorney General Bill Sorrell says he doesn't think many Vermonters are aware of this practice.

State law requires paid fundraisers to file information with the attorney general's office outlining how much money was raised for a specific campaign and how much money was actually paid out to the professional fund raiser.

The attorney general defines a paid fundraiser as an "outside entity" or company hired by a non-profit group, not employees for the non-profit who are on staff and raise money as part of their job. 

Sorrell's report covers 1,100 charitable campaigns that employed professional fundraisers over the past three years. During that time, Vermonters donated almost $8 million to campaigns that employed paid fundraisers. VPR was one of the nonprofits that has hired outside fundraisers, and was mentioned in the AG's report. In VPR's case, 92 percent of the money raised by the fundraiser went to VPR.

Sorrell says some of the fundraisers kept very little of the money. But he says, on average, 70 percent of the money never made to the charity.

"If you give to a charitable cause for a campaign that's being conducted by a paid fundraiser, then on average, the lion's share of every dollar you contribute is going to the paid fundraiser and not to the charity you're trying to support," he says.

Sorrell believes that the results of his new survey will come as a surprise and a shock to many Vermonters who contribute to these charitable campaigns.

"Most people really want to support that charitable cause and they would rather see 100 cents on the dollar — or darn close to it — go to the actual charitable cause,” says Sorrell, “Rather than just … paying some company that conducts fundraising campaign that are situated somewhere else in the United States."

"Most people really want to support that charitable cause and they would rather see 100 cents on the dollar — or darn close to it — go to the actual charitable cause, rather than just paying some company that conducts fundraising campaign that are situated somewhere else in the United States." - Vermont Attorney General Bill Sorrell

Sorrell says Vermont law also requires paid fundraisers to disclose to a consumer that they're being paid to solicit money for a charitable group. But he says sometimes this notification doesn't happen.

"I always ask, ‘Are you a paid fundraiser?'" Sorrell says. "And [I] make my decisions accordingly whether to support that particular campaign or not."

Sorrell says Vermonters who have questions about a particular charity should call his consumer protection office for more information.

Update 12:05 p.m., Dec. 9, 2015: The story was updated to note how the attorney general defines paid fundraisers. The update also notes that VPR has used such fundraisers in the past, with 92 percent of the money raised by the outside fundraiser going to VPR.