10 Tips for Charities Working with Paid Solicitors

Pennsylvanians are generous people and want to support your many good efforts. If not done in accordance with the law, problems arising from fundraising campaigns can lead to bad publicity, loss of profit and damage to the reputation and financial stability of charitable organizations. The Charitable Trusts and Organizations Section of my Office has compiled a list of tips to aid your charity when you hire a paid solicitor to conduct your fundraising campaigns. The following 10 suggestions are intended to assist your charity in properly monitoring paid solicitation campaigns and, thus, reducing the risk of problems to your organization.

Seek independent legal advice on the specific details of your fundraising campaigns to ensure that you are in compliance with Pennsylvania’s solicitation laws.

Tip #1
Be certain your organization and the paid solicitor are currently registered. Call the Pennsylvania Department of State, Bureau of Charitable Organizations (Bureau), at 1-800-732-0999, to verify: that your organization and the paid professional solicitor are registered; that the solicitor’s surety bond is current; and to obtain the solicitor’s registration number issued by the Bureau.

Tip #2
Ask for and check all references. A prospective paid solicitor should be able to give you the names and addresses of organizations on whose behalf he/she has conducted fundraising events. Check with these organizations to be sure they had a positive experience with the solicitor. You may also contact the Bureau to request information on registered professional solicitors.

Tip #3
Put your contract in writing. Your charitable organization must have a written contract with the paid solicitor executed by an authorized representative of your organization. All terms agreed upon must be in writing. The complete legal names of the organization and the paid solicitor should be used. The names of the persons signing the contract should be printed below their signatures. A full mailing address for both parties must be included. Be sure to include the following:

a statement of the charitable purpose for which the fundraising campaign is being conducted;
a statement of the respective obligations of the professional fundraising counsel or professional solicitor and the charitable organization;
clear and complete terms as to what amount of money raised goes to your charitable organization, including any terms which guarantee a minimum amount your charity will receive;
the beginning and ending dates of the contracts;
cancellation terms, if the solicitation is stopped for any reason;
a statement that the professional solicitor does not have custody or control over the funds as they are received, including funds arriving after the conclusion of the campaign;
clear and complete terms as to who will be responsible for distributing all show tickets and/or other promotional items involved in fundraising, and be sure that dates and times for performances, rentals, tickets, agreements, etc., are agreed upon and in place prior to the beginning of any solicitations;
clear and complete terms stating who will pay the solicitor’s expenses if the fundraising is unsuccessful, specifying whether the expenses are to be borne by the solicitor or the charity;
agree upon the final settlement date with the professional solicitor in advance and write it into the contract; and
any other information required by the Bureau.

NOTE: a copy of all contracts must be provided to the Bureau at least ten days prior to the date solicitations begin.

Tip #4
Review and approve the script or pitch to be used on the telephone. Your organization should closely review and approve any information used by the paid solicitor, either through telemarketing or direct mail. The paid solicitor and a member of your organization should closely supervise the solicitation calls or mailings to be certain they do not deviate from the script. The script must disclose that the solicitation is being made by a paid solicitor on behalf of your organization.

Tip #5
Make periodic, unannounced visits to the phone room(s) where the solicitations are being conducted. This will allow you to monitor what is being said to the public on behalf of your organization.

Tip #6
Review both the sales records and financial records of the campaign at least weekly. Make the project manager aware that you plan to do this.

Tip #7
Do not request cash donations. Request that all checks or money orders are made payable to your organization. If cash is received, it should be immediately deposited in the bank account established by the charity.

Tip #8
Obtain copies of all documentation, such as the original invoices as received, paid receipts as paid, bank statements, checks and deposit slips. Remember that solicitors, service providers and some contractors who are not paid by the professional solicitor eventually look to the sponsoring organization for full payment.

Tip #9
Monitor all expenses to be sure that they are reasonable, necessary and in the ordinary course of business. Immediately question any expense which you feel is excessive or without documentation.

Tip #10
Contact your local government officials prior to beginning any localized fundraising and ask whether or not any additional permits or licenses are required from the municipality.