The Royal British Legion has suspended operations with fundraising agency Magnum Direct, and the Fundraising Standards Board has opened an investigation, following an undercover report by the Mail on Sunday.
Among a catalogue of allegations against the agency, the Mail claimed that donors were lied to about what their money was spent on and that agency workers lied about being volunteers and were told to knock on doors with ‘no cold callers’ signs.
An undercover reporter for the paper also claimed to have witnessed agency workers using racist language.
According to the Mail, donors were told that their money would go directly towards a new rehabilitation centre for injured troops. In reality the money went to the charity’s general funds.
The charity said in a statement that it has had suspended all operations with the agency.
A spokesman for the charity said: “The Royal British Legion takes these allegations against one of our suppliers extremely seriously, and has launched an urgent investigation. While the investigation is underway we have suspended the services of Magnum Direct.
“Once the investigation is complete we will take appropriate action, so we can continue to ensure all of our suppliers conform to the highest standards in fundraising practices.”
Formal investigation
The Institute of Fundraising said today it has requested a formal investigation into the agency.
Peter Lewis, chief executive of the IoF, said: “All members of the Institute of Fundraising – including corporate supporters - sign up to adhere to the Code of Fundraising Practice.
“As a result of the Mail on Sunday’s investigation we have today formally notified the Fundraising Standards Board of these allegations and asked them to investigate.
“While this investigation is underway we are revoking Magnum Direct Limited’s status as a corporate supporter of the IoF.”
The FRSB has opened an investigation.
Alistair McLean, chief executive of the FRSB, said: "We are extremely concerned to hear of allegations from the Mail on Sunday about another fundraising organisation breaching aspects of the IoF Code of Practice which we enforce.
"The Code is designed to safeguard the public from sub standard fundraising practices and it is critical that fundraisers treat the public with respect, openness and honesty at all times. The FRSB will investigate these claims to establish whether any breach of fundraising standards has taken place.”
RBL’s latest set of accounts put its annual income at £133.5m. It raised £7.3m from the Poppy Lottery, which Magnum Direct was enouraging donors to sign up for. It costs the charity £3.2m to operate the lottery.
'Very disappointed'
On its website, Magnum Direct says its “key values” are “work ethic, solidarity, integrity, honesty and loyalty”.
“These values define our relationships and the standards with which we are constantly aspiring towards,” it said.
The agency was founded in 2005 with the aim of becoming “one of the UK's foremost direct sales companies creating a sales outsourcing brand with a reputation for quality, results and professionalism".
A spokeswoman for the agency told the Mail it was “very disappointed to have this feedback from within our company” and had “suspended the person in question”.
“We do not knowingly as an organisation break fundraising rules and we do not condone dishonesty nor racism on any level,” she said.
The agency is the latest of a string of fundraising agencies to come under attack by the Daily Mail, including Pell & Bales and GoGen. Last month GoGen announced its closure with the loss of 485 jobs, following a Daily Mail report into its fundraising practices.
Civil Society News contacted Magnum Direct for comment but did not hear back by the time of going to press.
Update: This article has been edited to make it clear that the Royal British Legion is not under investigation by the FRSB.
