News and analysis
March 05, 2015

Calif. Attorney General Backs Tougher Transparency Law for Fundraisers

California Attorney General Kamala Harris is backing new legislation that would boost transparency requirements for third-party fundraisers and extend the statute of limitations for certain offenses.

California law requires "commercial fundraisers" to include a disclosure in charity solicitations whenever a portion of a donor’s charitable contributions will go to a for-profit company. However, some fundraisers have skirted that requirement by establishing their operations as "fundraising counsel" instead of "commercial fundraiser."

The bill, sponsored by Assembly member Jacqui Irwin, would end the loophole and apply the transparency requirement to all for-profit companies involved in fundraising for charities, according to a statement from Ms. Harris’s office.

The legislation also would extend the state’s statute of limitations on certain offenses involving "the exploitation of charitable assets" to 10 years from five.

Most of the state’s registered charities do not use commercial fundraisers. But according to a recent report from the attorney general’s office, an average of 54.6 percent of funds raised through campaigns conducted by commercial fundraisers in the state in 2013 went to the charities.

"Californians should have complete confidence that the donation they make to a charitable organization will go toward the cause they support and feel secure knowing their gift won’t be diverted to the pockets of a third-party, for-profit fundraiser," Ms. Harris said in the statement.

Ms. Harris, a Democrat, is doing some fundraising herself. She is the first major candidate to enter the 2016 race for the U.S. Senate seat held by retiring Sen. Barbara Boxer.

Send an e-mail to Eden Stiffman.