Section 202.14. Regulation of professional fund-raisers.

 

(1)   Registration requirement.

(a) No professional fund-raiser may solicit in this state for a charitable organization that is required to be registered under s. 202.12 (1) unless the professional fund-raiser is registered under this subsection.

(b) Applicants for a professional fund-raiser registration shall apply to the department, in the form and manner prescribed by the department. Each application that is not a renewal application shall be accompanied by any information required by the department, including all of the following:

1m. The registration fee determined by the department under s. 202.041 , except that no registration fee is required under this subdivision for an individual who is eligible for the veterans fee waiver program under s. 45.44 .

2. A bond that is approved under sub. (2) .

(e) All professional fund-raiser registrations expire on August 31 of each year.

(2)   Bond. At the time of applying for registration under sub. (1) , a professional fund-raiser shall file with and have approved by the department a bond, in which the professional fund-raiser is the principal obligor, in the sum of $20,000. If a professional fund-raiser does not at any time have custody of any contributions, the bond shall be in the sum of $5,000. The professional fund-raiser shall maintain the bond in effect as long as the registration is in effect. The bond, which shall be in a form prescribed by and acceptable to the department, shall run to the state and to any person who may have a cause of action against the principal obligor of the bond for any liabilities resulting from the obligor's conduct of any activities as a professional fund-raiser or arising out of a violation of this subchapter or the rules promulgated under this subchapter.

(2m)   Annual report. Each professional fund-raiser registered under sub. (1) shall, on or before March 31 of each year, file a report with the department giving such reasonable and relevant information as the department may require concerning the business and operations conducted by the registrant. This report shall be in the form prescribed by the department.

(3)   Solicitation notice.

(am) Before performing services under a contract with a charitable organization that is required to be registered under s. 202.12 (1) , a professional fund-raiser shall file with the department a completed solicitation notice in the form and manner prescribed by the department. Forms prescribed by the department under this paragraph may contain any content or requirement that the department, in its discretion, determines necessary. The charitable organization on whose behalf the professional fund-raiser is acting shall file with the department a written confirmation that the solicitation notice and any accompanying material are true and complete to the best of its knowledge.

(bm) Within 7 days after any material change occurs in information filed with the department under par. (am) , the professional fund-raiser shall report the change, in writing, to the department.

(4)   Contract.

(a) A professional fund-raiser may not solicit contributions on behalf of a charitable organization that is required to be registered under s. 202.12 (1) unless the professional fund-raiser has executed a written contract with the charitable organization that clearly states the respective obligations of the professional fund-raiser and the charitable organization.

(e) The contract required under par. (a) shall include all of the following:

1. The name of the professional fund-raiser.

2. The name of the charitable organization.

3. The beginning and expiration dates of the contract.

4. The terms of the contract, including a clear description of the services to be performed by the professional fund-raiser.

5. A clear statement of the financial arrangement between the professional fund-raiser and the charitable organization, including, if applicable, a statement of all of the following:

a. The percentage or dollar amount of the total funds collected on behalf of the charitable organization that shall be paid to, or retained by, the charitable organization.

b. The percentage or dollar amount of the total funds collected on behalf of the charitable organization that shall be paid to the professional fund-raiser or any other person for purposes other than the exclusive benefit of the charitable organization's charitable purposes.

c. The fixed fee, if any, to be received by the professional fund-raiser.

d. All contractual expenses to be incurred by the professional fund-raiser but charged to the charitable organization. This list of expenses shall contain specific dollar amounts or projected estimates of these costs.

e. The costs per unit for the services to be provided and the projected number of units to be provided.

6. The signature of an owner or principal officer of the professional fund-raiser and the signatures of 2 authorized officers, directors, or trustees of the charitable organization.

(7)   Financial report. Within 90 days after completing services under a contract described in sub. (4) , and on the anniversary of the signing of a contract described under sub. (4) lasting more than one year, the professional fund-raiser shall, if the charitable organization is required to be registered under s. 202.12 (1) , account in writing to the charitable organization for all contributions received and all expenses incurred under the contract. The professional fund-raiser shall retain the accounting for at least 3 years and make it available to the department upon request.

(8)   Depositing contributions. A professional fund-raiser shall deposit, in its entirety, a contribution of money received by the professional fund-raiser, on behalf of a charitable organization required to be registered under s. 202.12 (1) , in an account at a financial institution within 5 days after its receipt. The account shall be in the name of the charitable organization. The charitable organization shall have sole control of all withdrawals from the account.

(9)   Record keeping.

(a) During the period in which a contract described in sub. (4) is in effect and for not less than 3 years after its completion, a professional fund-raiser shall retain all of the following records:

1. The name and, if known to the professional fund-raiser, the address of each person contributing and the date and amount of the contribution.

2. The name and residence address of each employee, agent, or other person involved in the solicitation.

3. A record of all contributions that are at any time in the custody of the professional fund-raiser.

4. A record of all expenses incurred by the professional fund-raiser which the charitable organization is required to pay.

5. A record of the location and account number of each financial institution account in which the professional fund-raiser deposits contributions.

(b) If under a contract described in sub. (4) the professional fund-raiser sells tickets to an event and represents that the tickets will be donated to an organization for use by others, the professional fund-raiser shall retain for the period specified in par. (a) all of the following:

1. The name and address of the donors and the number of tickets donated by each donor.

2. The name and address of the organization receiving donated tickets and the number of donated tickets received by the organization.

(c) The professional fund-raiser shall make all records described in this subsection available for inspection by the department upon request.

(10)   Nondisclosure. The department may not disclose information under sub. (9) (a) 1. to any person except to the extent necessary for investigative or law enforcement purposes and except that the department may, if requested under s. 49.22 (2m) , disclose information regarding the name, address, or employer of or financial information related to an individual to the department of children and families or a county child support agency under s. 59.53 (5) .

(11)   Solicitation disclosure requirements.

(a) Prior to orally requesting a contribution or contemporaneously with a written request for a contribution, a professional fund-raiser shall clearly and conspicuously disclose all of the following:

1. The name of the charitable organization, as it appears on file with the department, on whose behalf the solicitation is being made.

2. A clear description of the primary charitable purpose for which the solicitation is made.

3. That the contribution is not tax-deductible, if this disclosure is applicable.

4. The name of the professional fund-raiser, as it appears on file with the department, and that the solicitation is being conducted by a professional fund-raiser who is being paid for his, her, or its services.

5. If the individual acting on behalf of the professional fund-raiser identifies himself or herself by name, the individual's legal name.

6. Upon request by a person from whom a charitable contribution is sought, the percentage of the contribution that will be paid to the charitable organization as a result of the person's contribution. If the professional fund-raiser does not receive a percentage of the contribution, the professional fund-raiser shall disclose the dollar amount it was to or will receive.

(b) If a solicitation is made orally, including a solicitation made by telephone, the professional fund-raiser shall, within 5 days after the solicitation, send to each person contributing or pledging to contribute a written confirmation, receipt, or reminder of the contribution.

(c) In addition to the information required by par. (a) 1. to 5. , any written solicitation, and any confirmation, receipt, or reminder required by par. (b) , shall, unless the charitable organization has obtained a disclosure exemption under s. 202.12 (6m) (e) , conspicuously state the following verbatim: “A financial statement of the charitable organization disclosing assets, liabilities, fund balances, revenue, and expenses for the preceding fiscal year will be provided to any person upon request."

(d) The financial statement under par. (c) shall, at a minimum, divide expenses into categories of management and general, program services, and fund-raising. If the charitable organization is required to file financial information with its annual report under s. 202.12 (3) , the financial statement under par. (c) shall be consistent with the financial information reported in that annual report.

(e) The professional fund-raiser may not represent that tickets to an event will be donated to an organization for use by others unless all of the following conditions are met:

1. The professional fund-raiser has a commitment, in writing, from the organization stating that the organization will accept donated tickets and specifying the number of donated tickets that the organization is willing to accept.

2. The professional fund-raiser solicits contributions for donated tickets from no more contributors than the number of tickets that the organization has agreed to accept under subd. 1.

(f) The disclosures required by this subsection are required unless the professional fund-raiser is soliciting a contribution for a charitable organization that is not required to be registered under s. 202.12 (1) .

1991 a. 278 , 315 ; 1995 a. 27 ; 1997 a. 191 ; 2007 a. 20 ; 2011 a. 209 ; 2013 a. 20 s. 2211 ; Stats. 2013 s. 202.14; 2015 a. 163 ss. 89 to 105 , 113 , 115 .