Ohio Attorney General Dave Yost and charity regulators from 21 other states and the District of Columbia have reached an agreement with PayPal Charitable Giving Fund (PPGF), requiring the organization to boost transparency for donors on its online fundraising platform.
“Mixing secrecy with charity hardens the hearts of would-be donors,” Yost said. “This promise of transparency means donors will now have the information they need to guide their giving.”
Users of the platform pay money electronically to PPGF, which aggregates the donations and distributes them to charities selected by each donor. But in some cases, PPGF redirected contributions from selected charities to other organizations with similar purposes without telling donors. PPGF also failed to adequately disclose that charities that have PayPal accounts can receive donations faster than those that do not.
Charity regulators nationwide joined the effort to investigate PPGF’s fundraising activities, including its disclosures, vetting practices and treatment of charitable contributions. To address the states’ concerns, PPGF agreed to reform its disclosures to ensure that donors know:
• That they are contributing to PPGF
• The timeframe in which a selected charity can receive funds from PPGF
• The implication of being an enrolled charity rather than an unenrolled charity on the PPGF platform
PPGF also agreed to notify donors when it redirects charitable contributions to organizations other than those they selected. PPGF will provide regulators with future campaign data to ensure the organization is complying with its obligations under the agreement.
Additionally, PPGF agreed to pay $200,000 to the National Association of Attorneys General for deposit into the NAAG Charities Enforcement and Training Fund. This fund was established to defray costs associated with the investigation and litigation of cases brought by state charities regulators, and to provide training and education to those regulators.
States and territories participating in the settlement include Arkansas, Colorado, Connecticut, District of Columbia, Idaho, Illinois, Iowa, Kansas, Kentucky, Louisiana, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New York, North Carolina Secretary of State, Ohio, Oklahoma, Oregon, Pennsylvania, Texas, and Wisconsin.