June 6, 1972 EXTENSIONS OF REMARKS 19863 EXTENSIONS OF REMARKS CONTROLS NEEDED OVER CHARI­ ca.rd manufacturers, envelope suppliers, Most of the money, according to the agency's printers and gadget makers. statement under the District's Charitable TABLE MAIL SOLICITATIONS One cause raised over $1.2 million last Solicitation Act, promptly went to Korea. year, but had less than $75,000 left after it The next year, when the agency tried to paid the costs of its mail campaign. grow, it turned to ma11lng lists and sent out HON. LIONEL VAN DEERLIN Then there are the charlatans who gobble a wide appeal. It collected $975,000, but ex­ OF CALIFORNIA up all the money raised and pacify the in­ penses totaled $368,000. IN THE HOUSE OF REPRESENTATIVES tended recipient charity with a few thousand "I was disappointed when the auditors told me how much it cost," said the non­ Tuesday, June 6, 1972 dollars. Since the men who try to debase the cur­ professional fund-raiser. "We tried to keep Mr. VANDEERLIN. Mr. Speaker, most rency of philanthropy have been attracted to costs down. I didn't think it would be so Americans are unaware that as much fund-raising by mail, Chief Postal Inspector high." William J. Cotter says the Postal Inspection He works out of a basement office, pays his as 80 or 90 percent of the funds contrib­ help-much of it part-time-little more than in Service has intensified its investigation of uted response to mail solicitations possible fraudulent use of the mails to raise the minimum wage and himself lives in a are skimmed off by a variety of middle­ money for causes. medium-low income home. Through his ef­ men. Twenty so-ca.lied charities or promotiona.l forts, his brother-in-law, a priest in Korea, Too often, only a trickle passes through firms are now under investigation across the was able to build a 150-bed hospital and is to the intended beneficiary. country, three have been indicted and a now building a boys' town. This disgraceful situation was com­ United States attorney is now considering "I know you can raise funds for less than prosecution of another fund-raising project. 50 per cent of what you taken in," he said, prehensively outlined in reports pub­ "but if we try to grow the same a.mount lished in Sunday's Washington Star and Those are allegedly the outright frauds. Fund-raising appeals that violate no law but every year, it's going to be expensive every written by a Pulitzer Prize-winning in­ make more money for the promoters than for year." vestigative reporter, Miriam Ottenberg. their causes have prompted Rep. Lionel Van A fund-raising appeal doesn't use just one Miss Ottenberg points out the need for Deerlin D.-Calif., to start drafting what could malling list, but many. To try to find the legislation, which I am having drafted, be called "truth in giving" legislation. His right list for that particular appeal, the to let the donor know where his money idea is to require the printing right on the fund-raiser may rent as many as 30 or 40 is going when he responds to one of these solicitation it.s.elf just how much of the lists, using about 5,000 names from each. appeals. money raised goes to the cause. The fund-raiser will be testing not only His proposal could have broad impact be­ the names but the copy for the appeal, The shabby operators tend to poison cause almost $8 billion a year is raised by whether the package gets results. He may the atmosphere for all charities, even the mail appeals--half of it locally by church find the mail isn't the right vehicle and he'll completely legitimate. Self-disclosure and city-wide appeals, the other ha.If through turn to some other form of fund-raising. But would hopefully force out the marginal natlonal appeals. if it clicks, he'll proceed with the mail ap­ types, to the benefit of the honest ap­ Fund-raising by mail for both worthwhile peal, using the most productive 10 or 12 lists. peals which we would all want to sup­ and questionable causes has burgeoned since All this testing costs money and sometimes computers made it possible to focus appeals a new appeal hasn't got it. Some appeals port. borrow the initial sum, use money from the Miss Ottenberg's main article and an on groups with known interests. Before computers, it was prohibitively ex­ test to pay it back and get the funds to accompanying side-bar follow: pensive to try to sift out the names of poten­ finance a wider appeal. [From the Washington Star, tial givers. Occasionally, a fund-raiser will advance June 4, 1972] For in this business, the name is the game. the money for the test-particularly if he THE PLEAS IN YOUR MAILBOX Your name is worth money. The owner of dreamed up the project in the first place (By Miriam Ottenberg) a mailing list might get as much as $75 for and the people he interested in the cause are naive enough about fund-raising to sign Does your dally quota. of mall make you a thousand na.mes of known contributors like you. A list could be rented for as little as $15 contracts most favorable to his interests. feel that you and you alone a.re expected to In the realm of how much a fund-ralsing a.llevia.te all the world's miseries? a thousand names, but average cost runs from $25 to $35 a thousand for a. one-time campaign costs, the fund-raiser may be the If so, it's because your name is among the next big expense item. He may work for a millions selected by computers programmed rental. A productive list--tha.t is, one known to fee based on how much he produces and to find potential givers to causes. Subscrib­ how much time he puts in. Or he may take ing to a. magazine, belonging to a book or pull in the contributions-might be rented 20 or 25 times in a year. If you're on that a 15 percent mark-up on the cost of the ap­ record club, buying by mail or at some time peal package he has put together. Or he may giving to a single cause is enough to put kind of list, you could be introduced to tha.t many new causes and get on ma.ny new lists. ask for and get both a retainer and a better you among the chosen. than 15 percent mark-up on all the costs of Once that happens, you're asked to feed How many new lists you get on depends on your response to the causes. the campaign except postage. the hungry from Appalachia to Korea; heal If the fund-raiser also owns the mailing the sick of cancer and respiratory diseases For a charity, buying ma11lng lists is the first big expense. One cause that raised over lists he uses, he may get not only the rental and some diseases you never heard of before; fee for the mailing lists but also a 20 per­ support your symphony, or rehabllita.te $1 million spent half a million on mailing lists. cent broker's commission on the top of his wounded veterans and displaced refugees. other charges. But few fund-raisers collect The mail solicitations are usually appeal­ The goal of buying lists is not only to get an immediate source of contributions but that many ways. ing and expertly done. Pitiful children eye A Massachusetts fund raiser with 30 na­ you from the brochures. Sometimes the com­ to build a "house Ust"-those who contrib­ ute this year and wlll be solicited again tional accounts said the lowest fee he puter has worked your name into the body charges is $3,600. His highest was $24,000 of the letter and even recalled your previous next year. One professional fund raiser estimated but he produces over $30 million in contri­ generous gift. butions on that appeal. But do you know how much of your gift that it costs 56 cents to get one new contrib­ will go to those scrawny children or those utor but only five cents to bring back a pre­ A charitable agency may do its own fund­ maimed refugees? How much of your dollar vious contributor. raising but get the advice of a consultant is used to solicit more dollars through the Charitable agencies have to keep on seek­ on the wording of the use, when to send out mail? Is somebody--other than the intended ing new contributors because an estimated the appeal and appeal material, what mail­ recipient-profiting from your generosity? 25 percent of their previous contributors ing lists to how often, even whether to use The majority of fund-raising campaigns by move or die or otherwise lose contact every stamps or a non-profit machine stamp. mail try to pare expenses to make certain year and their number has to be replenished. To save agencies the cost of buying mail­ that the larger part of your gift goes to those Usually, the first year ls the hardest for ing lists, this consultant recommends using you want to help. Some long-established, a new cause--so difficult that some find costs the telephone book for mail solicitations. highly regarded charities have mail fund­ ea.ting up every cent tha.t comes in.