From holiday season giving to aiding in recovery efforts at home or overseas, consumers have several opportunities to donate to charity throughout the year. Whether donating your time, treasure or talent, Better Business Bureau of Southern Arizona reminds consumers to give wisely.

BBB Wise Giving Alliance Standards for Charity Accountability were developed to assist donors in making sound giving decisions and to foster public confidence in charitable organizations. 

The standards seek to encourage fair and honest solicitation practices, to promote ethical conduct by charitable organizations and to advance support of philanthropy.

Before you donate to a charity in 2012:

• Research the organization.  Check with your BBB at www.give.org to get reports on how national charities measure up to BBB Standards for Charity Accountability. Confirm the organization is registered with the IRS as a 501(c)(3) and verify the programs and distribution of money is where you want it to be. According to BBB’s Standards for Charity Accountability, at least 65 percent of total expenses should be spent on program activities and no more than 35 percent of contributions can be spent on fundraising.
• Be wary of imitations. Don’t be fooled by names that look impressive or that closely resemble the name of a well-known organization.
• Avoid giving personal information over the phone. Since nonprofits are not required to use the “Do Not Call” list, you could receive a phone call asking for a donation. Avoid giving your personal information over the phone and go “off the call” to confirm the legitimacy of the organization before deciding to donate.

Avoid giving to charities that:

• Use high pressure solicitations: A legitimate charity will be glad to give you the time needed to fully research its program.
• Offer prizes: Most honest charities do not try to entice you to give by telling you that you have won a prize.
• Steer you away from mailing a donation. Dishonest individuals try and avoid doing anything through the U.S. mail to avoid federal prosecution under postal statutes.

February is American Heart Month, and the Better Business Bureau of Southern Arizona is advising consumers to beware of a national heart charity soliciting donations.

The charity, Heart Support of America Inc. of Knoxville, Tenn., is sending out mailers offering free Heart Attack First Aid Kits and asking for donations of $10 to $25.

Records on file with the Internal Revenue Service show that about 90 percent of the donations raised on behalf of Heart Support of America go to professional fundraising companies. The records also show that less than 3 cents of every donated dollar goes to provide direct financial help to heart patients, their families or heart organizations.

Laura M. Perry of Clinton, Tenn., is the charity’s president. Perry and her daughter, Linda S. Boyd, are two of the three directors on the charity’s board.

“February has been designated as American Heart Month, a time when we reflect on the importance of a healthy heart and the enormous toll that heart disease takes on our families and our communities,” said Kim States, BBB President. “It’s a perfect time to give to charities that are making important strides in helping heart patients and funding research.

“Beware of any charity that spends most of its income on fundraising, salaries and other overhead,” she said. “It certainly appears that Heart Support of America is one of those.”

High fundraising costs are a reason for donor concern and a sign of an inefficient organization. BBB suggests that a charity spend no more than 35 percent of related contributions on fundraising. Related contributions include donations, legacies and other gifts received as a result of fundraising efforts.

The charity either has not responded to written BBB requests for information or has declined to be evaluated in relation to BBB Standards for Charity Accountability.

Heart Support of America provided records to the IRS that show the charity used professional fundraisers to raise about $7.5 million in donations from 2009 through 2011. Of that total, $611,000 (about 8 percent) was turned over to the charity.

About $208,000, or less than three cents of each dollar raised, was used for direct assistance to heart patients or their families, or for grants to hospitals and other charitable institutions.

In 2011, the most recent year for which IRS records are available, Heart Support of America raised about $2.2 million through its fundraising companies, Direct Response Consulting Services and Bee L.C., both with addresses in the same office building in McLean, Va. Records show that both Direct Response Consulting and Bee, L.C., have five-year contracts with Heart Support of America that end this spring.

Heart Support of America’s website says the charity was founded by Jim Halliburton in 1991, after he survived a massive heart attack.

The site says that the charity’s grant programs have paid for phone cards, emergency housing, transportation, prescription drugs, funeral assistance and a variety of medical supplies and equipment. It also includes profiles of several patients who reportedly were helped by the charity.

“Our desire is to serve the cardiac patient and their family in need through the processing of individual applications and through establishing grants to various social service departments,” the site says.

In addition to its direct grant program, Heart Support of America says it spent $740,000 on public education in 2011, providing information to the public about “nutrition, support and patient medicine.” It is unclear how much of that total is money spent as part of the charity’s mail and phone solicitations.

In its 2011 IRS report, the charity lists among its expenses about $98,000 in salaries, $221,000 in legal fees, $402,000 in office expenses and $981,000 in postage and mail house fees.

An audit report for the charity, dated April 5, 2012, noted that the charity “has recently suffered significant reductions in contribution revenues and has a net deficiency in net assets.” That deficiency, the audit report states, raises “substantial doubt about its ability to continue as a going concern.”

The charity did not respond to email and phone requests for information from the St. Louis BBB.

BBB offers the following tips for donors:

• If you are solicited by a telemarketer, ask the names of both the fundraiser making the call and the charity he or she is representing.  Ask how much of your contribution goes to the charity and how much is retained by the fundraiser.
• If you are solicited by mail, understand that a portion of your contribution may go to a for-profit company hired to run the campaign.  Call the fundraiser or charity and ask how much of your money the charity will receive.
• Contact the charity to find out how it uses donations from the public.  Will your donation provide direct aid to patients, buy medical supplies or be used for education or research?
• Check the charity’s BBB Charity Review at www.bbb.org  or by calling (520)888-5353. BBB evaluates charities based on 20 Standards of Accountability.

As immediate relief needs are assessed in the wake of the devastating earthquake in Haiti on January 12th, many Americans are looking for ways to help by donating to a charity. Better Business Bureau of Southern Arizona warns that—as occurred following the tsunami in 2004 and Katrina in 2005—fraudulent charities will likely emerge to try and scam donations from well-meaning Americans.

“Whenever there is a major natural disaster, be it home or abroad, there are two things you can count on. The first is the generosity of Americans to donate time and money to help victims, and the second is the appearance of poorly run and in some cases fraudulent charities,” said Kim States, BBB President.  “Not only do Americans need to be concerned about avoiding fraud, they also need to make sure their money goes to competent relief organizations that are equipped and experienced to handle the unique challenges of providing assistance.”

BBB offers the following six tips to help Americans decide where to direct donations:

Rely on expert opinion when it comes to evaluating a charity.

Be cautious when relying on third-party recommendations such as bloggers or other Web sites, as they might not have fully researched the listed relief organizations. The public can go to www.bbb.org/charity to research charities and relief organizations to verify that they are accredited by the BBB and meet the 20 Standards for Charity Accountability.

Be wary of claims that 100 percent of donations will assist relief victims.

Despite what an organization might claim, charities have fund raising and administrative costs. Even a credit card donation will involve, at a minimum, a processing fee. If a charity claims 100 percent of collected funds will be assisting earthqu (more…)