This article was last updated on May 20, 2022
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Canada Revenue Agency says many charities are paying 100s millions to fund raisers
The Canada Revenue Agency revealed that charities paid $762 million to professional fundraising companies. In some cases the charity only received a pittance of what was collected.
On PEI, five registered charities paid most of your money to fund raisers. One of them was the PEI Canadian Paraplegic Association which we identified in 2008 and run by Myrtle Jenkins Smith.
The CRA report covers the years 2004 to 2008 when $762 million was paid to external fund raisers. CRA guidelines state that less than 35% of the money raised should go to fund raisers.
Many are paying more than that and some more than 75%. CRA can revoke charitable donation numbers but rarely does.
Receiving a registered charitable number from CRA means your donations are tax deductible, which also means taxpayers are funding these organizations and their activities. When most of the money is not going to charitable works, it amounts to a scam on the Canadian taxpayer as well as a betrayal of trust. Tax dollars are being siphoned off for private purposes and not for charity.
Can small charities compete?
The reasons given for excessive payments are that small charities cannot compete with the big, glitzy media campaigns by the top charities.
That claim is no longer valid with the many ways charities can raise money through social media like Facebook and Twitter.
However, in some cases like AIDS PEI, the money is being paid to volunteers within the organization. ”Rather than hire an external fundraiser to conduct our fundraising operations, we hire our clients — Prince Edward Islanders living with HIV/AIDS, to come in and raise money for themselves, essentially,” said Hilton. CBC
If charities can’t raise money without paying people, are they really a charity? Do they have the support of the community or are they just another business? If a business paying their members, then the taxpayers should not be subsidizing them.
The PEI CPA is another kettle of fish. Not only are they paying professionals most of the money, theircampaigns demean those living with disabilities. Until we reported it, most of the money paid raised by Rick Hansen left the Province of PEI. After exposing this scam, the PEI CPA assured us some money is sent back to PEI although the CRA reports seem to indicate that is not true.
The Canadian Paraplegic Association seems to have this problem across Canada. Provincial associations in BC, Alberta, Ontario, Nova Scotia and PEI are reported to pay in excessive fees to fund raisers.
Database of charities over-spending on fund raising
CRA has a website where you can determine if a charity is really a charity or a money maker for these professionals.
CBC’s compilation of that site is more informative. You can check your province for charitable organizations that are paying too much to their fundraisers.
For instance, the QEII Health Sciences Foundation Centre Foundation in Halifax, NS paid $23.5 million in 2008 and 2009 to its fundraisers and only kept $ 2 million for charitable purposes. Considering the public sympathy the QEII builds with its annual fundraisers, who is profiting from the fund raising?
PEI Charities paying too much
PEI is not alone in this scandal. Nova Scotia has three pages of charities listed by CBC. QEII seems to be the worst case.
New Brunswick has 2 pages.
Ontario has 9 pages of charities that paid more than 75% of the money raised.
A particularly egregious story the the Canadian Red Cross Society that raised $1.4 million in 2009 and paid $1.2 million to the fund raiser.
With stories from CBC.
By Stephen Pate, NJN Network
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35% is daylight robbery!
People asking people is still the best fundraising methodology.
But professionals are not the only ones who can ask. Volunteer fundraisers are now being used effectively to ask their friends to join them in supporting causes they care about.
http://www.fundly.com is a platform that has been used to power volunteer fundraising, and causes that have used it have raised over $180M…
It is a travesty to pay professionals to do what we can do ourselves!
-db