Posts Tagged ‘Telefund’

SPLC — 2017 Telemarketing Scam

February 4, 2017

The Southern Poverty Law Center has released its IRS Form 990 and Audited Financial Report for F/Y 2016, and as predicted, it was a very profitable year for the company.

Part of of that success comes from the SPLC’s use of third-party telemarketers who convince first-time donors that their money will be used to somehow “fight hate.” In reality, their money, and that of thousands of existing SPLC donors, will be used to fight poverty — for the telemarketers, that is.

As we’ve reported in years past, the SPLC pays these telemarketers far more than they raise over the phone. Last year the company paid telemarketers $2,266,887 donor-dollars to raise only $1,271,287 donor-dollars, for a net loss of $955,600 (p. 40).

2017-telemarketing-numbers

As usual, the big winner was Grassroots Campaigns who were paid $1.8 million to raise just over $600,000. Telefund only pocketed 62% of the $340,000 it raised, while Harris Marketing kept 83% of the $256,800 it took in.

Since 2011, the SPLC has paid Grassroots  $5,828,603 more than they received in donations. While it seems incongruous that a company like the SPLC, which is forever sending out fundraising letters, as “the need has never been greater,” would be able to survive such financial hemorrhaging, the truth is they’ll make a fortune from it.

In essence, the SPLC is paying the telemarketers for the personal information of thousands of proven first-time donors, which they will feed into their own uber-efficient in-house fundraising machine. They take a loss on the first year but make it up with years, or even decades of successive donations down the road, at a sweet 100% profit.

The company isn’t even taking that much of a hit, as all of the first-time donations go straight to the telemarketers and any deficit is made up out of the existing donor pot, without any of the donors being the wiser.

How many long-time donors does it take to make up a $955,600 “shortage”? At $100 a pop, just under 10,000 donors. At a more reasonable $25 donation rate, just under 40,000 well-meaning suckers.

Granted, the use of third-party telemarketers for such purposes is not illegal and is practiced by many of the largest non-profits in the country. It’s up to the potential donor to ask the solicitor how much of their money will actually reach the SPLC.

Since Grassroots is paid a flat fee, they can even tell Grandma with a straight face that all of her donation will go to “fight hate.” That the SPLC is only going to triple the amount and send it back to Grassroots is merely a minor detail.

We’ve only just made our first pass over the SPLC’s latest financials. Stay tuned for more information on where the money goes.

Advertisements

SPLC — 2016 Telemarketing Scam

March 22, 2016

Continuing a trend that Watching the Watchdogs first uncovered last year, the Southern Poverty Law Center has once again duped tens of thousands of new donors out of their money through the use of third-party telemarketers.

Page 40 of the SPLC’s IRS Form 990 tax return for 2015 shows that, once again, the company paid far more to the telemarketers than was raised in donations.

grassroots2015

Once again, the big winner was Grassroots Campaign, Inc., which was paid $2,028,857 to raise only $757,182, for a resulting loss to the SPLC of $1,271,675 donor-dollars right off the top.

One would think that such a discrepancy would horrify the frugal bean-counters at the SPLC, but in fact, just the opposite is true, based on Grassroots’ past performance.

2011:  -$212,214

2012:  -$869,686

2013: -$1,156,765

2014:  -$1,130,680

Overall, the SPLC seems mighty pleased with Grassroots’ efforts.

Not only was last year’s Grassroots deficit a new record high, it once again completely consumed every last dime raised by Telefund and Harris Marketing Group, meaning that all $1,514,365 dollars raised by all three firms, in the name of the Southern Poverty Law Center, went right back to the telemarketers, as well as another $969,474 right out of the SPLC’s existing donor pot.

So how many donors got scammed out of their money over the phone in 2015? At $25 dollars a pop, which seems fair for a first-time donation amount, only 60,575 well-meaning people who truly believed they were somehow “fighting hate.”

That’s over 60,000 people in just one year and that doesn’t include the 38,779 long-time donors who sent the SPLC their cash directly, for a grand total of 99,354 suckers for 2015 alone.

Over the past four years, the SPLC has sent more than 382,000 $25-dollar donations straight to the telemarketers.

But wait! There’s more! First of all, it’s not hard to figure out who the telemarketers are reaching by phone, if you think about it. Most cell phone numbers are not listed, most listed telephones are landlines, and most landlines today are owned by older people.

And how can the SPLC justify this horrific hemorrhaging of much-needed cash year after year? Well, that’s simple too, as the telemarketers actually sell the donors’ personal information to the SPLC, which then feeds the data directly into its own uber-efficient, in-house fundraising machine.

The SPLC takes a hit this year, (which is paid for by long-time donors), but next year, and the year after that, and the decades after that, every dime goes directly into the company’s crowded coffers. Last year they took in more than $54 million in tax free donations on top of their $302 million dollar endowment fund.

In the long run, these telemarketer tactics are not illegal, lots of other big name non-profits do the same thing. And for the 382,000 donors who paid the telemarketers to sell their information to the SPLC, “ignorance is bliss,” as they have no idea what the SPLC does with their money anyhow. They wrote out those checks willingly, convincing themselves that that was all they had to do to “fight hate.” They pretty much got what they were paying for.

If there is one bright note, it’s that the other two telemarketers, Telefund and Harris, actually turned over more of the money they solicited over the phone in 2015. In 2014, Telefund skimmed a mere 75% off the top of each donation. Last year they only pocketed 64% of the take.

Harris Marketing Group, after taking an incredible 90% cut of every donation in 2014, must have felt some genuine remorse, as they only took a 40% share of the pie this year.

Maybe there is hope for these people after all.

 

The SPLC’s Outright Telemarketing Scam

February 27, 2015

One month ago, we gave the Southern Poverty Law Center the benefit of the doubt concerning their dubious telemarketing practices. Today, with the release of their 2014 IRS Form 990 tax report, we cannot cover for their outright telemarketing scam any longer.

Here is the SPLC’s IRS Form 990 for the fiscal year ending October 31, 2014.

Click Image to Enlarge

Click Image to Enlarge

For the fourth consecutive year, SPLC Founder Morris Dees, who bills himself as a “sound steward” of the donors’ money has deliberately scammed tens of thousands of well-meaning donors through his network of paid telemarketing rip-off artists.

To wit, for the past four years Mr. Dees has continued his relationship with Grassroots Campaigns of Boston, Mass, despite the horrific hemorrhaging of donor dollars. Grassroots has cost the SPLC hundreds of thousands, and even millions of dollars each year for their fundraising efforts:

2011:  -$212,214

2012:  -$869,686

2013: -$1,156,765

2014:  -$1,130,680

How in the world can Mr. Dees continue to deal with a company that has blatantly siphoned $3,369,345 donor-dollars out of his coffers over the past four years? These horrendous figures more than wipe out every dollar raised by his other telemarketing cronies, not that that amounted to all that much.

Checking out Telefund, Inc. of Denver, we see that they raised $561,102 in the name of the SPLC  in 2014, and only pocketed $422,292 in fees, leaving the SPLC $138,811, or a whopping 25% of the donation money.

Did anyone tell the donors that Telefund was pocketing three quarters of their donor-dollars?

But that’s all chump change compared to the experts at Harris Marketing group, who raised $213,694 in the name of the SPLC and “fighting hate,” and only pocketed $192,928, or a mere 90% of the money donated over the phone.

And yet, Morris Dees could not be happier with the results because Grassroots, Telefund and Harris all sold their information to him. For mere pennies on the dollar, Mr. Dees buys solid donor leads that he can feed into his own uber-efficient in-house fundraising machine at 100% profit down the road.

Best of all, it was the stupid donors who unwittingly paid to have their information sold to Mr. Dees. You really cannot beat that for “stewardship.”

Dees will lose money on the deal this year, but it’s nothing compared to the tens of millions he stands to gain from these donors over the coming decades.

But think about it. In 2014, Mo Dees paid $2,537,027 to third-party telemarketers to raise $1,979,272 in donor-dollars, meaning that the telemarketers kept every last dime they solicited over the phone in the name of the SPLC as well as an additional $557,755 out of the SPLC’s existing donor till

THIS is “sound stewardship?”  At $100 dollars apiece “only” 25,370 of the 2014 donors got screwed out of their donations. A mere pittance. At $50 dollars a pop the number jumps to more than 50,000 suckers, and yet, Mo Dees calls this “sound stewardship?”

Justify it anyway you want, but at least 25,000 well-meaning donors got screwed out of their money, just as they have for the past four years.

It’s time that the media and the IRS investigates the criminal scamming of the Southern Poverty Law Center. This is nothing less than blatant fraud. Selling the suckers one thing and giving them something far less.


%d bloggers like this: