Lessons from Fundraising Regulator ILA investigation

Last week the Fundraising Regulator (the Regulator) published the outcome of its investigation into the charity, International Liberty Association (ILA). The decision has important lessons for trustees of all charities undertaking fundraising activities (ergo. most charities).

Background

ILA is a charity that aims to promote respect for human rights in Iran and the Middle East and assist the victims of such abuse.

There were sixteen complaints to the Fundraising Regulator between 2015 and 2018 regarding the charity’s fundraising practices, usually arising from house-to-house fundraising visits made by ILA volunteer fundraisers. The visits were usually made by appointment after previous contact by a supporter of the charity.

The complaints

The complaints alleged that significant and undue pressure had been placed on the potential donors by the volunteer fundraisers and that donors had been vulnerable and potentially taken advantage of by the volunteer fundraisers.

Notable to the Fundraising Regulator were the following aspects of the complaints:

1. the volunteer fundraisers operated in pairs;
2. requests sought large contributions (thousands of pounds up to £11,000);
3. in two cases it has been suggested that the potential donor take out a loan to fund the donation; and
4. volunteer fundraisers continued to seek donations from a vulnerable donor even after police told them to stop.  

The Regulator found the ILA had breached five sections of the Code of Fundraising Practice.

Fundraising and trustees

The Charity Commission has made it clear that all trustees are to have effective oversight of their charity’s fundraising activities. Charity Commission Guidance CC20 lays out the Commission’s expectation concerning trustee fundraising oversight and duties. It is intended to guide and help trustees meet their obligations. Following the Code of Fundraising Practice, effectively managing volunteers and working with volunteers within the Code of Fundraising Practice all falls within the guidance of CC20.

Failures

The Fundraising Regulator made direct criticism of the trustees, not just the volunteer fundraisers.

In summary, their failures were:

1. Failure to maintain proper oversight of fundraising activities and inadequate monitoring;
2. Creating a high-risk fundraising model in the organisation;
3. Failing to ensure fundraising was compliant with the Code of Fundraising Practice; and
4. Failing to take action to address complaints, even when being made aware of them.

The Fundraising Regulator interestingly noted that in the case of ILA, as they did not use professional fundraisers, the trustees were (or should be seen as) the link between the fundraisers and the standards to be adhered to. Which meant that the trustees were “directly accountable” for “all aspects of the fundraising taking place”. The Regulator saw the use of volunteer fundraisers as a “high-risk fundraising model”, which undoubtedly would have increased the regulator’s expectation on the trustees in respect of monitoring and oversight.

Learnings

Key takeaways from this case for trustees are fourfold.

Firstly, the use of volunteers to conduct fundraising of this type is high risk, and with a high-risk fundraising model, trustee oversight and monitoring need to increase. Trustees must act positively to mitigate the risks inherent in this fundraising model.

Secondly, merely having in place a good-practice vulnerable-persons policy is not sufficient, trustees must ensure theory is followed through to reality.

Thirdly, if a charity does not have a paid staff member or specific volunteer to deal with complaints, a trustee needs to sign off the responses to and the method of handling complaints.

Finally, trustees should be alert to the emergence of patterns on complaints, address the causes of those patterns and learn from them, always giving specific consideration to the Fundraising Code.

The Fundraising Regulator’s decision to make public its investigation was motivated by their belief that governance and fundraising lessons need to be learnt more widely by charity and their trustees.

Further information 

For help with any issues raised in this briefing, please contact Natalie Barbosa.