Charity begins at home

Sobering article at Bloomberg:

Charities Deceive Donors Unaware Money Goes to a Telemarketer
Carol Patterson was waiting for a call from her doctor. When the phone rang on that afternoon in August 2011 at her home in Cortland, Ohio, it wasn�t a physician on the other end. A woman named Robin said she was representing the American Diabetes Association.

Robin didn�t ask for money. She asked Patterson to stamp and mail pre-printed fundraising letters to 15 neighbors. Both of Patterson�s parents and one grandmother had been diabetic, so she agreed to do it, Bloomberg Markets magazine reports in its October issue.

�I thought since it does run in the family, it wouldn�t hurt for me to help,� says Patterson, 64, a retired elementary school teacher. She guessed, based on what she knew about charity fundraising, that about 70 to 80 percent of the money she brought in would be used for diabetes research.

The truth was almost the exact opposite. The vast majority of funds Patterson, her neighbors and people like them throughout the country would raise -- almost 80 percent -- would never be made available to the Diabetes Association. Instead, that money collected from letters sent to neighbors would go to the company that employed Robin and an army of other paid telephone solicitors: InfoCision Management Corp.

Just 22 percent of the funds the association raised in 2011 from the nationwide neighbor-to-neighbor program went to the charity, according to a report on its national fundraising that InfoCision filed with North Carolina regulators.

And that was the good news -- some more:

And it gets worse. Many of the biggest-name charities in the U.S. have signed similarly one-sided contracts with telemarketers during the past decade. The American Cancer Society, the largest health charity in the U.S., enlisted InfoCision from 1999 to 2011 to raise money.

In fiscal 2010, InfoCision gathered $5.3 million for the society. Hundreds of thousands of volunteers took part, but none of that money -- not one penny -- went to fund cancer research or help patients, according to the society�s filing with the U.S. Internal Revenue Service and the state of Maine.

Fees Added
Every bit of it went to InfoCision, the filings say. The society actually lost money on the program that year, according to its filings. InfoCision got to keep 100 percent of the funds it raised, plus $113,006 in fees from the society, government filings show.

Lots more at the site including scans of the script that:

...instructs solicitors to tell the people they call that �overall, about 75% of every dollar received goes directly to serving people with diabetes and their families, through programs and research. The other 25% goes to program management.�

and scans of the contracts. InfoCision is doing nothing illegal -- except lying to the marks -- they are just permeated with an ethical stink that needs to be cleaned up. Taking advantage of people's altruism for commercial gain. Makes me wonder how much money has been spent on lobbyists to keep the legislation favorable. Reader ORChuck nails it with this observation:

ORChuck
The problem here is that charities have become industries unto themselves. They no longer work for the causes they claim, but they work for themselves and their own perpetuation.

In many respects, The Association to Cure X, A2CX, has a conflict of interest. If they do manage to cure X, then they've just stabbed their golden-egg-laying goose. Once the "executives" at A2CX tuck into comfey positions with handsome salaries and generous benefits and big expense accounts, traveling all over the country in first class, attending red-carpet "fund raisers," hob-nobbing with celebrities, etc., and once they have a payroll of hundreds of people working for A2CX, and the A2CX Headquarters Building, and all that, they have little incentive to actually cure X. Quite to the contrary, in fact. A cure for X would, at that point, be a disaster. So, if a scientist had a breakthrough and actually found the cure for X, the executives at A2CX would likely dip into donor funds to hire a hitman. It'd make a fun movie plot... if it didn't raise such serious questions.

Jerry Pournelle's Iron Law of Bureaucracy writ large:

Pournelle's Iron Law of Bureaucracy states that in any bureaucratic organization there will be two kinds of people:

First, there will be those who are devoted to the goals of the organization. Examples are dedicated classroom teachers in an educational bureaucracy, many of the engineers and launch technicians and scientists at NASA, even some agricultural scientists and advisors in the former Soviet Union collective farming administration.

Secondly, there will be those dedicated to the organization itself. Examples are many of the administrators in the education system, many professors of education, many teachers union officials, much of the NASA headquarters staff, etc.

The Iron Law states that in every case the second group will gain and keep control of the organization. It will write the rules, and control promotions within the organization.