Regulatory code breaches have been found at a national charity and several third-party agencies as part of an investigation into door-to-door fundraising practices.
The Fundraising Regulator found that the National Deaf Children’s Society (NDCS) committed six breaches of its code across responsibilities of charitable institutions, monitoring and compliance and due diligence and contracts.
It also found sub-subcontracted fundraising companies Solution Cardiff and Vantage Consultancy were responsible for six breaches of the code across behaviour while fundraising, fair treatment of people and behaviour when collecting money or property.
The investigation came after journalist Conor Gogarty contacted the regulator in July 2023 about NDCS’s regular gift fundraising, saying he had gathered concerning information while undercover as a new starter at one of the sub-subcontracted companies.
NDCS had hired Smile Fundraising to carry out fundraising activities on its behalf, which the company had subcontracted to Interactive Team.
In turn, Interactive Team had subcontracted the activities to Solution Cardiff and Vantage Consultancy, both of which have since been dissolved.
In an article for Wales Online, Gogarty reported being told by Vantage Consultancy staff to “trick” people “into saying yes”, but never received training on fundraising regulations.
‘Lack of oversight’ of subcontracting structure
In its summary report published today, the regulator said it was clear that the sub-subcontractors had been carrying out “poor practice” and that NDCS had breached its code due to a “lack of oversight of this subcontracting structure”.
The regulator found that while NDCS had conducted appropriate due diligence and monitoring activity on Smile Fundraising, “subsequent checks on subcontractors and sub-subcontractors within Smile’s network were insufficient to meet the code’s requirement”.
It said Vantage Consultancy and Solution Cardiff were not members of the Chartered Institute of Fundraising as required, and found no “meaningful distinction” between the fundraisers working for them.
“We also found that the video footage provided by the undercover journalist showed both sub-subcontractors engaging in persistent and unreasonable fundraising, attempting to fundraise from a potentially vulnerable individual and making deliberately misleading claims,” the report reads.
“On this basis, we found that both Vantage Consultancy and Solution Cardiff had breached the code regarding the standards expected of those actively involved in face-to-face fundraising activities.”
While NDCS “had sought assurances from the agency that relevant obligations were being passed on”, the regulator found that it had failed to “routinely review or approve the contracts used beyond its direct relationship with the agency”.
It said: “This wasn’t an unusual practice within the sector at the time. We also found that the charity wasn’t fully aware of the subcontractor’s role in the supply chain until specific questions were asked during our investigation.”
It concluded that NDCS’s expectations “weren’t consistently or clearly reflected in contractual arrangements” across the supply chain, which reduced the charity’s ability to exercise effective oversight.
Contracts ‘must address subcontracting’
Gerald Oppenheim, chief executive of the Fundraising Regulator, said: “The complexity of this case demonstrates how charitable organisations must have clear procedures in place to ensure sufficient oversight of fundraising activities on their behalf.
“Where charities use third-party fundraisers – particularly in face-to-face fundraising – expectations of contractors must be clearly set from the outset and continuously reinforced with clear visibility of all parts of supply chains.
“Charities remain responsible for fundraising done in their name, and robust monitoring and contractual safeguards are essential to maintaining public trust.”
Jim Tebbett, head of proactive regulation and projects at the regulator, said this investigation acted as “a catalyst to improve and renew the wider sector’s fundraising practices”.
“Through our market inquiry and engagement with charities, fundraising agencies, and our sector and regulatory partners, charities are now left with no doubt that they must ensure that their contracts with fundraising partners address subcontracting and mandate clear, workable mechanisms for oversight,” Tebbett said.
“Ultimately, charities must be able to demonstrate that they understand who is fundraising in their name and how those activities are being monitored.
“This transparency is essential to ensure public confidence in fundraising so charities can continue their vital work.”
A spokesperson for NDCS told Civil Society: “We regret that we didn’t have full oversight of our agencies’ subcontracts at the time of this investigation, which relates to work carried out in April 2023.
“We fully accept the regulator’s finding that this fell short of the standards expected of us, and we welcome their ruling that agencies must now share these subcontracts with the charities they work with.
“This clarity will help strengthen fundraising standards across the whole charity sector. We’ve since revised our processes to ensure full oversight and compliance going forward.”
