FAQs about Professional Fundraisers
Who is considered a professional fundraiser?
- A professional fundraiser is any person or entity who is retained under contract or otherwise compensated by or on behalf of a charitable organization primarily for the purpose of soliciting funds.
- Professional fundraiser does not include any bona fide employee of a charitable organization who receives regular compensation and is not primarily employed for the purpose of soliciting funds. § 407.453, RSMo
One or more nonprofits pay me to write grants for them, do I need to register?
Maybe, it depends on what your agreement with the nonprofit requires you to do. If you solicit funds for that nonprofit, then you meet the definition of a professional fundraiser and you need to register. If you merely edit applications that the nonprofit submits, then you do not need to register since you are not the person doing the soliciting. If you’re unsure, you can contact us.
What is considered solicitation of funds?
A solicitation is any request or appeal, either oral or written, or any endeavor to obtain, seek or plead for funds, property, financial assistance or other thing of value, including the promise or grant of any money or property of any kind or value for a charitable purpose. § 407.453(6), RSMo.
What is not considered solicitation of funds for registration purposes?
Missouri law creates two exceptions to what is considered a solicitation:
- Direct grants or allocation of funds received or solicited from any affiliated fund-raising organization by a member agency; and
- Unsolicited contributions received from any individual donor, foundation, trust, governmental agency or other source, unless such contributions are received in conjunction with a solicitation drive. § 407.453(6), RSMo
What happens if I fail to register?
If you solicit funds for charitable purposes without being registered you will violate the consumer fraud provisions contained in Missouri’s Merchandising Practices Act, Chapter 407, RSMo. In short, the Missouri Attorney General’s power to pursue fraud applies to failure to register, the same as any scam, fraud, swindle, etc. The penalties can be severe since each solicitation constitutes a separate violation of Missouri law. And under Missouri law each individual violation can be punished by a civil penalty of $1000, restitution, a ban on solicitation, and other relief. Since the penalties can be harsh, we strongly encourage everyone to err on the side of registering.
What is an appropriate percentage for a professional fundraiser to keep?
Guidelines issued by the Better Business Bureau (BBB) suggest spending at least 65% of its total expenses on program activities and spend no more than 35% of related contributions on fund raising. Related contributions include donations, legacies, and other gifts received as a result of fund raising efforts.
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