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Sunday August 7, 2005

100% to charity? Think again

Christine Tan (right) buying a bookmark from Aisah Ibrahim but does she know how much of her gift from the heart goes to the home?
PETALING JAYA: You donated RM1 for a bookmark that carried the National Kidney Foundation’s (NKF) name, hoping that your contribution would make a difference to a renal patient.

But the truth is, only 10 sen of that ringgit went to the foundation’s coffers.

The rest may have been split between the person who sold you the bookmark, his boss, and the company that produced the item.

Charity has become a business, and much of what people give may not end up where it should.

And this does not just stop with the selling of items such as bookmarks and greeting cards – it also involves the public’s bank accounts, where up to 40% of what is deducted monthly as donations does not go to charity.

In the case of NKF, it had an arrangement with Montrans Connections Sdn Bhd whereby a small percentage of revenue from the sale of the company’s products was channelled to the foundation.

Montrans Connections, a subsidiary of Montrans Holdings Sdn Bhd, hires people to sell items it makes to promote a certain organisation.

“Montrans approached us with the idea of giving us publicity and selling bookmarks, plastic fans and pens.

“From the 10 sen we receive for every bookmark sold, we got about RM8,000 a month. In the last 11 months, we received RM79,000,” said an NKF official.

Checks by The Star with Montrans Connections employees revealed that they can make as much as RM100 a day in commission. Pens are sold at RM10 each and plastic fans, RM5.

NKF said the arrangement was good as it raised not just cash but also awareness of the foundation.

“The company has the manpower and the money to bear the initial costs of a project like this,” said the official.

“If we do a similar project, what would happen to the people we employ when the project ends?”

The official said if the public were not comfortable with giving money this way, then they should refrain from doing so.

BUSINESS OF CHARITY: Aisah Ibrahim is one of those selling bookmarks at the KLCC LRT station.
However, the official added that people had complained to NKF after buying the items and the foundation has not renewed its contract with Montrans Connections, which expired on July 31, partly because of the public’s reaction.

But NKF is still continuing with the direct-debit donor programme run by Sharity Greetings (M) Sdn Bhd, a local fund-raising company, together with Asian Support Direct (M) Sdn Bhd, which is owned by Appco Sdn Bhd.

Under such programmes, the foundation and at least four other groups – the National Cancer Council (Makna), World Wide Fund for Nature Malaysia (WWF Malaysia), Shelter Homes for Children and Kiwanis Down Syndrome Foundation – benefit from monthly deductions from bank accounts.

Makna fund-raising director Vemanna said the council had as many as 40,000 active contributors and donations came to about RM1mil every month.

Both Makna and WWF said they received the full amount deducted, and payments to the companies concerned – which have people on the ground actively soliciting donations – were made separately, but they declined to reveal the amounts paid.

However, the NKF official said 30% of deductions went to Asian Support Direct for overheads in the first four months of the programme, with another 10% to Sharity Greetings to maintain the database of donors.

For every month after that, Sharity Greetings receives 10% of the donors' contributions.

A Sharity Greetings official confirmed that the company received 10% of deductions from each of the groups it worked with. Asian Support Direct and Appco could not be reached for comment.

In addition to such programmes, Sharity Greetings also partners with Granton Sdn Bhd to produce festive season cards sold in the name of charity.

Granton and Appco are both part of the Cobra Group, a direct marketing company based in Britain and Australia.

Registrar of Societies (ROS) Kaswuri Keman said a registered society was not allowed to have any party collecting donations on its behalf.

The Societies Act 1966, he said, required any organisation registered under the Act to obtain approval from the Registrar to collect money from the public.

“Collections can be done only for the period approved,” he added.

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