Nonprofit Newswire | Cuomo Files Suit to Shut Down Fund-Raisers

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The Nonprofit QuarterlyJanuary 20, 2010; New York Times | We take note of this Grey Lady blog item because it shows that New York Attorney General Andrew Cuomo is starting to emulate his predecessor, the now disgraced former governor of New York, Eliot Spitzer, in getting tough on nonprofit enforcement issues. AG Cuomo is litigating to shut down four for-profit telemarketing companies that used deceptive or misleading tactics in fundraising for nonprofit clients. Apparently, this was the result of an undercover investigation by the AG’s office, which makes it a little more interesting than the run-of-the-mill nonprofit enforcement activities of most AGs and the IRS. According to the Times blog, these companies had previously faced similar accusations. Over the past three years, the four companies raised a total of $16 million and kept more than three-fourths of that take for themselves. The state reports that 80 of 204 registered fundraising companies did telemarketing for nonprofit clients last year, raising $204.8 million on behalf of 444 nonprofits—but the nonprofits received only $80.9 million of that total. No fans of the rapacious telemarketers here, we’re glad to see the AG take action (especially when so many nonprofits and national nonprofit infrastructure or leadership organizations have defended them in the past, for reasons that were spurious and, much like the telemarketers, often deceptive). But we worry that the title “AG” might mean “aspiring governor.” Let’s hope that Cuomo’s enforcement energies continue when and if he decides he’s not a candidate for higher office.—Rick Cohen

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