CHARLESTON, SC (WCSC) - A new report from the South Carolina Secretary of State reveals in some cases, only a fraction of fundraising dollars actually make it to the charity intended.
Secretary of State Mark Hammond released the first annual Professional Solicitor Report of the Division of Public Charities "to promote accountability and transparency in charitable fundraising," specifically in regard to professional or paid fundraisers called solicitors.
When a charity or organization uses a solicitor and pays them to help raise money, it's no surprise the company would keep their share and use funds to cover the cost of the event or fundraising effort.
But in some cases, one percent or less of a fundraiser went to the actual charity. And, Hammond said, it's totally legal as long as the companies are being honest about how much a group should expect to make on a fundraiser.
Hammond recommends guidelines based on the Better Business Bureau. "Looking at the overall charity, we recommend organizations spending 65 percent and above for their charitable purposes."
And dealing with profession fundraisers may skew their numbers, Hammond worries.
"A lot of the organizations who solicit for schools or for firefighters, on average the professional fundraiser is getting 52 percent of that contribution before they send money to the charitable organization."
"We want to help educate donors here in South Carolina to let them know what a professional fundraiser is and when it is a professional fundraiser, exactly how much money is going to the fundraiser and how much is going to the charitable
organization," Hammond told Live 5 Wednesday.
He added, "Our numbers show that if you receive a piece of mail or get a phone solicitation, on average only 36.2 percent of that actually goes to the charity."
There were several Bingo charity events hosted by various promoters and Bingo companies in the Charleston area. They benefited groups such as the VFW and children's cancer groups.
The percentage actually donated to charity was often in the single digits, even if the fundraiser generated more than a million dollars.
For example, one Bingo event in 2015 for a local animal society listed a gross receipt of $1,472,132,00.
The net amount given to the charity? About 1.2 percent. $18,000.
Live 5 is investigating the list of local Bingo examples further.
"Our study shoes once the Bingo game is over and the report is filed, on average just over 1 percent actually goes to the charitable organization. 1.6 percent. Bingo promoters are getting the lion's share of what is raised," said Hammond.
County school systems were also listed as beneficiaries of some fundraisers.
Berkeley, Charleston and Georgetown county school districts worked with Great American Opportunities LLC in 2015. The company assists with sales of products such as cookie dough or wrapping paper.
In Charleston, one GA fundraiser listed gross receipts of $435.50. About 19 percent went to the district.
GA fundraisers in Georgetown brought in 35-41 percent of gross receipt and a Berkeley county schools got about $29 of $74 raised.
In other school districts, GA fundraisers brought in much higher percentages, even 299 percent in one case.
Great American has not yet responded to share how they determine those percentages. The school districts themselves are looking into the numbers after Live 5 asked whether they were satisfied with the money raised.
Hammond is asking charities and donors to research the companies before you give.
"Some pay millions on fundraising and after they account for expenses, there's very little left going to the charitable organization," he said.
He pointed to a Supreme Court ruling that said professional solicitors can't be restricted because it was deemed an infringement on free speech. But Hammond believes some sort of restrictions are warranted.
"I think it would be beneficial if there was a way we could do something that wouldn't infringe on constitutional rights but at this point there hasn't been any legislation proposed," he said.