Charities should keep fundraising costs to 35 cents on the donor dollar and avoid paying commissions to telemarketers or doorknockers, say proposed federal rules.
It’s a first for Canada’s charity watchdog. Until now, it has failed to deliver clear-cut rules on fundraising for the country’s 82,000 charities. Now it has, complete with a list of dodgy tactics that can turn donors off a charity.
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Among them, commission schemes that lead to high-pressure tactics (fundraisers only get paid if you donate) and repeated pitches that misrepresent what the charity is doing and how donors’ money is being spent.
In a written statement to the charity community, the federal Charities Directorate says the new guidelines explain what types of fundraising “may result in revocation” of the charity’s status. Penalties charities face under the new regime include hefty fines, suspension for one year (a chance for the charity to clean up its act) and outright shut down of its charitable status.
“The (charity) regulator should be applauded for coming out with this,” said Georgina Steinsky-Schwartz, president of Imagine Canada, a group that speaks for charities.
But Steinsky-Schwartz cautions that some charities may have valid reasons for spending more than 35 cents of each dollar on fundraising and she hopes the regulator will take a flexible approach.