Based in St. Louis, and with contracts with Disabled Firefighters Fund, the Coalition of Police and Sheriffs, [...]]]> The St. Louis Post-Dispatch reported last Sunday on the work of Jason Birrittier — charity telemarketing entrepreneur. Jason recently shut down his telemarketing operation (called Public Safety), after a run-in with law enforcement. He denied all allegations.

Based in St. Louis, and with contracts with Disabled Firefighters Fund, the Coalition of Police and Sheriffs, and the American Veterans Relief Foundation, Public Safety kept more than 80 percent of the money it raised. Note: each of those three “badge” organizations had previously earned our Charity Skunk award.

Read the St. Louis Post-Dispatch story.

Comments in the article from Mr. Birrittier provide fascinating insight into his thinking (and perhaps that of similar charity telemarketers). According to the Post-Dispatch:

• “I felt by what I was doing, I was still helping out,” Birrittier said.
• Birrittier said he enjoyed talking to donors. If any of them asked how much of their donation would stay with Public Safety, he said, he would offer the truth — 82 or 85 percent, depending on the charity.  “People would still give after telling them that,” he said, “believe it or not.”

Apparently his thinking was — “If people are willing to donate when more than 80% won’t go to the charity, why shouldn’t I give them the opportunity?”

Mr. Birrittier reminds us why we avoid charities that use paid telemarketers.

See our post in [...]]]> We here in California are not alone dealing with the sleazy folks who dress themselves up as charities and dial for dollars for causes including veterans, firefighters, police and more. Another one of these groups has now hit Minnesota, according to a story in the Minneapolis – St. Paul StarTribune.

See our post in May on the California’s Attorney General’s Office lawsuits against 53 individuals, 17 telemarketers and 12 “charities” who purported to be helping police, firefighters and veterans. The California action is part of the Federal Trade Commission’s Operation False Charity.

The Minnesota group – calling itself Minnesota Disabled Veterans – isn’t a charity and accordingly doesn’t show up on IRS Publication 78′s list of charities. But the group uses a name confusingly similar to that of a known charity: Disabled American Veterans of Minnesota.

The Minnesota group raises its money through telemarketing.

Based on the California action, each of the following has earned our Charity [...]]]> California’s Office of the Attorney General on May 29 announced lawsuits against 53 individuals, 17 telemarketers and 12 “charities” who purported to be helping police, firefighters and veterans. The California action is part of the Federal Trade Commission’s Operation False Charity.

Based on the California action, each of the following has earned our Charity Skunk Award:

• Law Enforcement Apprenticeship Program, and its directors and fundraiser (Rembret, Inc.)
• California Police Youth Charities, and its executive director and fundraisers (National Consultants, Inc. and Public Appeals, Inc.)
• American Association of Police Officers, Police Protective Fund, Inc. and Junior Police Academy (operated by the same group), their officers and fundraisers (including West Coast Advertising, aka Professional Communications Network, and Mark Christiansen, dba Charitable Fundraising Services).
• Association for Firefighters and Paramedics, its president and its fundraisers (Public Awareness LLC, Community Support, Inc. and Courtesy Call, Inc.)
• Association for Police and Sheriffs, Inc., its directors and fundraisers (Public Awareness LLC, and Courtesy Call, Inc.)
• Homeless and Disabled Veterans Corporation and its fundraiser (Almost, Inc.)

California also acted against Coalition of Police and Sheriffs, Disabled Firefighters Fund and American Veterans Relief Foundation — earlier recipients of Charity Skunk Awards.

The complaints overflow with allegations like: fraud, false promises, misuse of donated funds, unfair business prectices, filing false public documents, failure to keep records, deceptive and misleading solicitations, improperly compensating directors and officers, and deceptive and abusive telemarketing practices.

Tips offered to potential donors by the California Attorney General’s Office:

• If you receive an unsolicited call asking for a donation, it is most likely from a paid telemarketer who may keep a substantial part of your donation as payment of fundraising fees.
• Recognize that the words ‘veterans’ or ‘military families’ in an organization’s name don’t necessarily mean that veterans or the families of active-duty personnel will benefit from your donation.
• Donate to charities with a track record and a history. Charities that spring up overnight may disappear just as quickly.
• If you have any doubt about whether you have made a pledge or a contribution, check your records. If you don’t remember making the donation or pledge, resist the pressure to give.
• Check out an organization before donating. Some phony charities use names, seals and logos that look or sound like those of respected, well-established organizations.
• Ask the soliciting charity or the paid fundraiser what percentage of your donation will go towards fundraising expenses and what percentage will go towards the charity’s charitable purpose.
• Do not send or give cash donations. For security and tax record purposes, it is best to pay by check made payable to the charity.
• Ask for a receipt showing the amount of your contribution.
• Be wary of promises of guaranteed sweepstakes winnings in exchange for a contribution. You never have to give a donation to be eligible to win a sweepstakes.

alleging that all three organizations, based at the same address [...]]]> The Federal Trade Commission (FTC) announced on May 20 Federal court cases and proposed settlement orders involving

• American Veterans Relief Fund (AVRF),
• Coalition of Police and Sheriffs, Inc. (COPS),
• Disabled Firefighters Fund (DFF) and
• Individual defendants Jeffrey Dean Duncan, William Rose and Kathy Clinkenbeard,

alleging that all three organizations, based at the same address in Santa Ana, CA, were created almost entirely to provide profits for the individual defendants and the for-profit fundraisers they hire. In recognition of their work, we’ve awarded the organizations and individual defendants our not-so-coveted Charity Skunk Award.

The FTC alleges, for example, that telemarketers calling on behalf of AVRF falsely claimed that the money they were raising would support families of soldiers fighting overseas — when virtually no money went to such families; COPS misrepresented its affiliation with law enforcement; and each organization misrepresented that donations would go to a legitimate charity, that they had programs (which did not exist), and that the programs would benefit the local community of the donor.

According to a related Los Angeles Times report, the groups raised $19 million from 2005 to 2008 but turned over only 5% of the money to legitimate charities. The report quotes counsel to the defendants, who said “the groups didn’t pay more to charities because they [the groups] incurred high costs.”

There’s more interesting information to be gleaned from the most recent tax returns (Form 990) of the three organizations,

• In 2007, together they raised more than $4 million. In 2004 through 2007, together they raised more than $18 million.
• In 2007, together they averaged spending a miniscule 5.3% on programs (the leader being AVRF, which spent a whopping 7.3%).
• In 2007, 65% of their spending went to ten outside telemarketing firms – and one firm was common to all three organizations.

If you take a look at the filings by that common firm with the CA Registry of Charitable Trusts, you’ll see that:

• The firm reported that they raised a bit over $2 million for charities, and that only about $300,000 (or 14.5%) of that went to charities. Guess that’s some of what counsel (see above) was talking about.
• COPS, DFF and AVRF aren’t the only groups the firm has worked for here in California.

Kind of makes us wonder whether the FTC has found a whole den of skunks — we hope they’ll keep digging, regardless of the smell!

The FTC website has several helpful documents on avoiding charity fraud. Start with this one. See also our links in the right column.

NFOA and several related individuals are now the subject of desist and [...]]]> Recently I learned of a charitable scam that had been operating in my local area (as well as other parts of the U.S.) – National Foundation of America (NFOA). In recognition of its work, we’ve awarded NFOA our not-so-coveted Charity Skunk Award.

NFOA and several related individuals are now the subject of desist and refrain orders issued by the California Department of Corporations. The orders are available online.

The orders reveal that NFOA, among other things,

• Held itself out as a charitable, humanitarian and philanthropic organization — when it was not.
• Offered to individuals “tax-deductible charitable strategies” — which were neither tax-deductible nor charitable.
• Targeted elderly and unsophisticated investors, and collected more than $3 million from its targets.
• Failed to register with the California Registry of Charitable Trusts, even though it did business in California as a charity.

These schemers will always be with us. Building on their everyday activities, they seem to be especially active following [...]]]> The U.S. is a very charitable and generous society. Unfortunately, the charitable, generous natures of many makes them the target of the unscrupulous — who often disguise themselves to look like charitable or humanitarian causes.

These schemers will always be with us. Building on their everyday activities, they seem to be especially active following up on well-publicized disasters across the world.

We’ve created the Charity Skunk Awards to help spread the warning about charity scammers and their schemes. We can learn by observing what they’ve done. We can spread awareness. Perhaps we can even help law enforcement catch a few while we’re at it. Past Charity Skunk Award recipients.

You can help in this effort. If you have come across a charity scammer, give us the details in an email you send to skunks@smartergivingguy.com — we’ll check out the information you give us and, who knows, you might nominate the Charity Skunk of the Year!