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Opinion/Philanthropy Journal – Donors must protect themselves

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By Todd Cohen

Americans burned by phone hustlers that keep most of the money they raise for charity are on their own.

The Supreme Court ruled May 5 that charitable solicitors can face fraud suits only if they try to fool donors about how much of what they give actually goes to charity.

But the ruling does not shield donors from greedy telemarketers simply because they pocket big chunks of the money they raise.

Charities like the decision because it draws a line between free speech and fraud but does not mess with past rulings that, citing free speech, struck down state and local efforts to police how much charities can pay telemarketers, or what they have to tell prospective donors.

As long as they do not lie, the Supreme Court says, telemarketers can hoard donations and feed off donors too busy, lazy, shy or naive to ask about the telemarketer’s share before giving.

So donors need to be smarter because charities are weak and state watchdogs are weaker.

Many charities fall prey to the lure of telemarketers promising cash and image-building in return for a big cut of the take.

And most politicians lack the spine to crack down on charity telemarketers or stand up for donors.

Under its “donor beware” doctrine, the Supreme Court has freed telemarketers to keep hitting on charities and donors, leaving them with the job of cleaning up charitable solicitation’s mean streets.

If they fail to police the telemarketers they hire, and fail to make sure donors understand where their dollars go, charities do not deserve donor support.

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