The purpose of this circular is to standardize charity crime prevention information presented during community crime prevention meetings and impart basic skills on awareness and investigative methods used to research any charities soliciting within your area.
Historically, charities were developed to meet certain needs of society. They were formed to do "public good" and to provide aid to segments of the community that fell outside of the general scope of public assistance. The state of California is home to more than 72,000 charitable organizations; this represents about one-eighth of all the charities in the United States.
Each state, city and county has their own set of ordinances to govern what is expected from each charitable organization. A surprising fact is that approximately only 200 cities and counties have ordinances in place to govern the laws of charitable organizations and solicitation rules. Of these, two ordinances are applicable to all states. These two ordinances are Internal Revenue Service (IRS) codes. They are 501 C (3) (IRS Code), for non-profit charitable organizations, and 501 C (3), a profit organization working for a non-profit organization. The definition, as given by the IRS, of a 501 C (3) organization is any religious, educational, charitable, scientific, literary, all testing processes for Public Safety, National or International Amateur Sports Competitions, or organizations structured for the prevention of cruelty to children or animals.
Clarification of non-profit versus profit organization is as follows: a non-profit organization’s proceeds or monies raised go directly to the charitable organization. A profit organization may take some of the proceeds or monies gained from any event held for a specific organization and pay for cost incurred in the process, with the rest or yield of the income going to the charitable organization. For instance in the case of a dinner dance event, any cost incurred such as rental items, ticket sales, catering costs, etc., a profit organization will be paid for prior to the charity receiving any funding. Examples of non-profit organizations would be Aids Project
Los Angeles, and March of Dimes. Examples of profit organizations would be Friend of Children’s Hospital - Los Angeles, whose proceeds benefit Children’s Hospital of Los Angeles and the popular donation of vehicles to various organizations.
In cases of a profit organization, find out exactly how much of your donation will be received by the actual charity. An example is the vehicle donation organization; yes, it does provide you with a tax write off for the full blue book amount of the vehicle, but only approximately zero to 50 % of the actual amount is donated to the charity. The rest of the donation is used to cover the cost of advertising, towing, as well as miscellaneous costs and is considered a legal contract governed by the state of California.
Within this crime prevention circular the terms charity and organization are used, both words have the same definition within the circular.
Questions frequently asked are "How do I know that this charity is legitimate?" and "Where does this money go once I make a donation?" This circular is designed to help you recognize what is an authentic charity and provide tips on how to avoid being victimized by a charity that is not legitimate.
All charities whether non-profit or profit must raise funds to survive. Most charities rely on various income sources that can include:
- Public support,
- Government funding,
- Private foundations grants; or
- Fees collected for services they provide as part of charitable programs.
A charity can solicit funds in several different ways. Some solicitors are paid for their efforts by the charity or by the private fundraiser hired by the charity, while others work as volunteers. Some examples of typical or most poplar solicitation techniques are as follows:
- Fundraising events, i.e., dinner dances, raffles, and marathons/races
- Direct in-person requests
- Direct mail or telephone solicitation requests
- Newspaper and magazine advertisement
- Sales of tickets to special events or sales of products
HOW TO PROTECT YOURSELF FROM BEING SWINDLED
It is easy for you to place faith into a "charity" that seems to be providing a great service for an organization in need. But it is up to you, "the contributor" to research where your money is going. Included in this circular are examples of criteria your favorite organization must adhere to and crime prevention tips to keep your money safe.
Every city is governed by its own set of ordinances, the Los Angeles City Municipal Code (LACMC) Number 44.00 sets forth the criteria needed to solicit within the City limits.
The conditions are:
- An application must be filed with the State of California, which includes the organization’s bylaws and a listing of its Board of Directors.
- Regardless of where the organization is based (even out of state charities) an application must be filed with the City of Los Angeles if the charity plans to solicit within the City.
- The application must state the intent of the charity and where the funds raised will be dispensed.
- A background check is conducted to gather information on the organization.
- A permit is then given to the organization to proceed with any solicitation method they chose.
- After the solicitation is completed the organization must file a report of results of activity with the City of Los Angeles.
- Follow-up investigations are completed on any of the above mentioned items as needed.
CRIME PREVENTION TIPS
These are tips to help you avoid being swindled by an illegitimate charity or organization.
Organizations soliciting within the City of Los Angeles are required to obtain an information card from the Los Angeles Police Commission prior to soliciting contributions. A person can check to see if the charity is a valid charity prior to making a donation by calling the Los Angeles Police Commission’s, Charitable Services Section, at 213-978-1144.
- Do not give cash to strangers.
- Take the time to learn about the charitable organization you support or considering supporting.
- Be assertive on the telephone with telephone solicitors.
- Tell the solicitor whether in person or over the telephone that you would like to do some research on the charity/organization.
- Make all donations by check to the organization or use employee-withholding programs through your work.
- Ask every charity solicitor who solicits money from you where and how your contribution will be used.
- DO YOUR HOMEWORK, research the organizations, and do follow-ups with local city agencies that provide ordinances for these organizations. Don’t expect that every organization has all the proper paperwork they are supposed to have.
- Read and understand everything before you sign.
The Los Angeles Police Department does not solicit nor endorse solicitation of funds for any type of police related charity either through telephone solicitations or through door to door activities.
Be wary of solicitors that exhibit the following signs:
- Pressure to sign blank checks, or donations of substantial amounts to organizations you have not checked out.
- Unwillingness to explain what the organization is about or where your money or gift will be going.
- Tricky wording on issues you don’t understand. Take your time to investigate these organizations.
Keep your best interest in mind. It’s okay to be skeptical, or overly cautious. Make sure to research before you donate and that the organization you donate to is a reputable and legitimate charity.
Information to compile this circular was taken from the following sources and materials:
- Los Angeles Police Commission, Charitable Services Section
- State of California, Office of the Attorney General
- United States Treasury/Internal Review Service (IRS)
- Channing L. Bete
- Los Angeles City Municipal Code (LAMC) Section 44.00
Other sources for research would include:
- The Council of Better Business Bureaus Philanthropic Advisory Service (BBB-PAS)
- The National Charities Information Bureau (NCIB)
- The County of Los Angeles, Charitable Services
- State of California, Office of the Attorney General Registry of Charitable Trusts
- Secretary of State for the State of California and
- Los Angeles Police Department, Community Liaison/Crime Prevention Unit
Be willing to take action in the event you do encounter fraud issues with a charitable organization. Here are some suggestions:
- The Government, local, state, and federal protection agencies
- The State Attorney General’s Office
- The Better Business Bureau
- Legal experts
Additionally, you may check the validity of a charity on the California Attorney General’s Web site at, www.caag.state.ca.us, or the Web site for the Better Business Bureau at, www.give.org.
The following agencies will be able to provide you with some type of documentation, such as a report or materials, on where you can report a charity related crime. They may also provide you with further information on courses of action.
Be aware and willing to put a little extra time into investigating your favorite charities/ organizations. Most solicitation companies are valid organizations that work hard for the charities/organizations for which they solicit. Know what to do in the event that you encounter an organization that is not legitimate and remember it’s better to be safe than to become a victim. You can never be too careful or too prepared.
Listed below are helpful telephone numbers and addresses to assist you in the event an incident may arise or any assistance you may need.
HELPFUL TELEPHONE NUMBERS AND ADDRESSES
Los Angeles Police Department
Community Liaison/ Crime Prevention Unit
150 N. Los Angeles Street, Room 818
Los Angeles, CA 90012
Commission Investigation Division
Charitable Organizations Section
200 N. Main Street, Suite 1513
Los Angeles, CA 90012
State of California
Office of the Attorney General
P.O. Box 944255
Sacramento, CA 94244-2550
Secretary of State
1230 J. Street
Sacramento, CA 95314
Internal Review Service
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