The United States is slowly coming out of the coronavirus shutdown. Businesses are reopening–like casinos today here in Las Vegas–and folks are going back to work. But that swelling workforce apparently includes those who labor in that section of the cold-calling telemarketing industry pushing would-be charitable-minded donors to make contributions–very little of which will go to the stated mission.
After several months of silence–hey, one might catch COVID-19 in boiler-room call centers–the phones at the New To Las Vegas world headquarters have started ringing regularly again with such pitches.
Following a trend first noted here two years ago, the calls have been on behalf of political action committees, or PACs. These, of course, aren’t charities at all, but conduits for political contributions and sometimes lobbying. They masquerade as charities. No more than pennies on the dollar are spent on the seemingly laudable mission. For the often-shadowy figures behind these enterprises, a big benefit is extremely light scrutiny by one of the most toothless regulatory agencies we have, the Federal Election Commission, as well as virtually no scrutiny at all by state charity regulators and private charitable watchdogs.
This week, I received a call from someone identifying herself as Susan. In a sweet tone, she solicited a donation for American Coalition for Autistic Children. She described this as an organization supporting lawmakers who favor funding autism research. I hadn’t heard of the enterprise and asked where it was located. She said Orland Park, Ill., which is a distant suburb of Chicago.
Picking up on the reference to aid legislators, I asked if American Coalition for Autistic Children was a PAC. “No,” Susan said. I then asked if it was a 501(c)(3) charitable organization. “Yes,” Susan said. The difference between the two is significant. A contribution to a 501(c)(3) organization is tax-deductible. A contribution to a PAC most definitely is not.
Both of Susan’s responses were incorrect. I could have asked if Susan was a real person, but I knew that answer. I was talking to a computer, monitored by a real human, using artificial intelligence to decipher my questions and provide answers–not always truthful, but answers nevertheless. Clearly, artificial intelligence isn’t always intelligent.
There is no PAC or 501(c)(3) charity that I can find with the name American Coalition for Autistic Children, in Orland Park, Ill., or anywhere else. I eventually reached an actual person working for the telemarketer. She said American Coalition for Autistic Children was a name used by another PAC, American Alliance for Disabled Children PAC. Indeed, American Alliance has a website saying it’s located in–Orland Park, Ill.
Aha! I quickly dug out Federal Election Commission filings for American Alliance. For me, that’s where the rubber really hit the road about the faux autism charity and its faux charity parent.
American Alliance, which also solicits using the name American Anti-Bullying Alliance, was founded sometime in 2019. From its creation to March 31, 2020, the latest filing, American Alliance received $445,000 in contributions. Of that, the PAC spent $438,000 in fundraising and what I would call related costs. But perhaps only about $7,000 was spent in what might be called furtherance of the stated mission for outreach: a Web presence, reimburse of some expenses and contributions to two other PACs.
As I see it, 98% of the money raised went right out the door for fundraising, and less than 2% of total expenses was spent in furtherance of the mission. I doubt many good-faith donors would be pleased to learn of such dreadful financial efficiency ratios. These are topics that telemarketers like “Susan” don’t bring up voluntarily and do everything they can to avoid addressing. Indeed, I’ve had a fair number of Susan-types hang up rather than answer even innocuous questions, like, “Where is your organization located?”
I sent a request for comment to American Alliance through its website and will update this post if I hear back. But of course, not everyone may be back at work yet from the coronavirus closure like “Susan.”