The Royal British Legion and a face-to-face fundraising agency both breached the Code of Fundraising Practice, the Fundraising Standards Board has ruled, in an investigation following up an exposé in the Mail on Sunday.
In an investigation report published today, the FRSB found that the activities of agency Magnum Direct “were not sufficiently monitored” by the Royal British Legion and also said that the agency in question was in breach of four separate codes, in relation to a story which appeared in the Mail on Sunday on 2 August 2015.
The article alleged that Magnum Direct fundraisers lied to the public about being unpaid volunteers and that managers at the agency had been instructing new fundraisers to explicitly ignore ‘No Cold Callers’ signs on doors.
It is also alleged that agency employees told perspective lottery players that their money was going directly towards a rehabilitation centre that the Legion was building, when in fact the lottery subscriptions were being put directly “to the charity’s general funds”.
Magnum Direct street fundraisers were contracted by the Royal British Legion at the time to secure new players for its ‘Poppy Lottery’ campaign.
The FRSB found that the RBL “had not sufficiently monitored Magnum Direct’s fundraising activities” at the time.
It also found that Magnum Direct had not “trained its sales agents to deliver a ‘solicitation statement’; that a senior member of Magnum Direct’s training team had “misleadingly implied that monthly lottery subscriptions” would be restricted for use on a rehabilitation centre, and that an MD trainer “encouraged the Mail on Sunday’s undercover reporter to adopt pressurising tactics to secure” subscriptions.
The FRSB have noted that, at the time of the Mail on Sunday’s article, “there was a general misunderstanding by some in the sector that solicitation statement legislation did not apply to lottery canvassing” because it did not itself involve the acquisition of a ‘donation’.
The contact between the RBL and Direct Magnum also did not make any reference to this legal requirement.
The Code was changed in November to make it clear that “a solicitation statement must be made every time a professional fundraiser solicits money or any other property (such as a lottery ticket)” and the FRSB said that Magnum Direct is now fully compliant.
The FRSB said that the RBL “terminated is contract with Magnum Direct three days after” the article appeared and have, after a review into its fundraising practices, had now effectively stopped using face-to-face fundraising “as a means of recruiting new direct debit supporters”.
The RBL have also begun recruiting a compliance officer and are “setting up processes to ensure that it carries out more visits to the premises of third-party fundraising agency partners”.
For its part, Magnum Direct accepted the resignations of the two trainers implicated in the article, implemented an immediate ban on fundraisers visiting households displaying ‘No Cold Calling’ stickers, made delivering solicitation statements mandatory and required all of its employees to attend a ‘Regional Retraining Day’ on 5 and 6 August 2015.
As part of its organisation-specific recommendations, the FRSB said that the RBL should “conduct more frequent shadowing of doorstep fundraisers acting on the charity’s behalf” if it were to ever again employee face-to-face fundraising techniques.
The FRSB also recommended that Magnum Direct “reviews the current payment structure” that it uses for its fundraisers. The regulator said that “commission-only” payment structures – while not strictly prohibited by the Code – could lead to “the adoption of pressurised tactics similar to those” found in the Mail on Sunday article.
A spokesman for the RBL said: "Following an urgent Legion investigation into allegations in August 2015 which identified poor working practice, we moved quickly to terminate our relationship with Magnum Direct. The Legion no longer engages in any doorstep fundraising activity.
“Our practices are under constant review to ensure we are working to the highest of standards and we welcome the FRSB’s report as a further opportunity for review.”
A statement issued by Magnum Direct said:"Magnum Direct Limited has always viewed this regrettable incident in July 2015 as presenting an opportunity for us to improve our quality assurance programme and to become a better supplier to the charity sector.
"Magnum has worked in this sector for nine years and assisted both big and small charities to increase their fundraising income. We are proud of what we have accomplished."
Stephen Dunmore, interim chief executive of the Fundraising Regulator, said: “This investigation by the FRSB has again shown how essential it is for charities to monitor the arrangements they make with fundraising agencies very closely.
“If they do this they will be much better placed to deal with issues like this quickly and take action themselves to maintain public trust and confidence by stopping problems before they happen.”
The full report can be read here.
Related articles
