IFAS | Freedom Writer | May/June 1997 | telefunding.html

Making money the telefunding way

By A.H. Barbee

It's been said that starting your own religion is a good way to make a million dollars. Launching a para-church organization may be better.

The para-church movement emerged during the conflict between religious fundamentalists and modernists that began early in this century. Organizations within this segment of the religious domain differ from mainline churches and other denominations in several ways. Most center around a particular leader and focus on his (occasionally, but rarely, her) ideology.

Unlike local churches whose spiritual leaders are generalists (ministers who preach sermons, visit the sick, perform weddings, and conduct funerals), para-church leaders are typically miles removed from even their most dedicated followers who see them as specialists in ministry, with near celebrity status. They reach their followers through television, radio, and direct mail. Many are masters at promoting ideologies and causes that range from moderate faith-based social services to radical conspiracy theories that create fear and stir followers to share their message with the goal of creating converts.

There are thousands of para-church organizations. Their legal status is that of a 501(c)(3), the Internal Revenue Service classification for nonprofit organizations. Advocates of para-church organizations encourage them to pursue further recognition as a religious nonprofit or church under Section 170 of the IRS code. With this in hand, unlike other 501(c)(3) nonprofit organizations which report income and activities via Form 990, para-church organizations are not required to report to anyone. Lack of accountability engenders absolute power; absolute power is known to corrupt absolutely.

The para-church movement gives a new answer to the question, "What is a church?" While many people still think of a church as the building on the corner with religious symbols, a place where religious leaders conduct services, courts now refer to "functional churches." Thus, religious radio stations, media ministries, camps and conferences, benefit from legal exemptions allowed only by entities recognized as a church. These include freedom from paying property taxes, state unemployment taxes, and sales taxes. It also gives these "functional churches" the right to receive tax-deductible donations and allow contributors to deduct their donations from personal income taxes. The costs to society are staggering.

Though different from traditional churches, para-churches share some similarities, especially one: they all need money to survive. Unlike local churches that draw upon resident congregants for financial support, para-church organizations seek donations from contributors developed through several methods. Anyone who has ever heard a radio preacher or watched a televangelist knows that appeals for money are an integral part of their shows.

Para-church organizations also employ representatives who contact individuals and churches who share their organization's views and attempt to create constituents who give regularly. Many individuals are also persuaded to include a religious organization in their wills. Mailing list brokers market names, addresses, and phone numbers that religious organizations use to develop new donors. The ever-popular "appeal letter" that may not always tell the truth about an organization, its key personalities, or causes claimed still works.

Since para-churches do not have local congregations from which to solicit donations, the movement spawned an industry to foster the religion business. It is called telemarketing in the for-profit sector; telefunding in the nonprofit religious sector. Telemarketing fraud costs Americans $40 billion a year, much coming from older consumers. Nobody knows how much money telefunding solicitors raise, use, or misuse, under the guise of religion. But like money raised by dollar-driven telemarketers in the commercial sector, you can be sure that a high percentage of the millions raised for nonprofit religious organizations by telefunding comes from older contributors who can least afford to give money away.

Let me explain how telefunding works. A not-for-profit religious organization employs a for-profit firm to call its constituents or individuals it believes might have an interest in supporting a project or cause. Unlike a local church, where all contributions are used to support its people and programs, only part of donations raised by for-profit fundraising firms reach nonprofit religious organizations. And while fundraising programs for local church projects are handled by members or other volunteers with shared beliefs, employees who make what the industry considers a "courtesy call" to potential contributors do not necessarily agree with the religious beliefs of the religious organization they represent in a telefunding scheme. Their primary motions are: (1) making telephone contact with a prospect; (2) reciting a script that defines a religious organization's needs and financial goals; (3) collecting a contribution by credit card; and (4) picking up their personal paycheck from the for-profit firm that employs them.

I recently received a "courtesy call." The caller introduced herself as a representative of a nonprofit religious organization and asked if I had time to listen to an "urgent" message from the key spokesperson a religious radio speaker and author. I asked how urgent the message was a question the caller could not answer. Then I asked if she had listened to the urgent message. When she said she had not, I suggested that the message obviously wasn't as urgent as claimed and hung up!

Religious telefunding often uses prayer as a gimmick to get money from respondents. A major telemarketing firm, with a telefunding division for religious clients, provides employees a fill-in-the-blank form, part of a script that, according to their legal representative, "constitutes a prayer in the eyes of the caller (or person called)." This firm has grown from four communicators to more than 1000 employees in telemarketing (selling products by phone) and telefunding (raising money by phone). It raises more money for nonprofit organizations than any other telemarketing company in the world.

While the firm defines prayer as a religious function, it views prayer as a tool of the fundraising trade, on the level with a salesperson's spiel presented in a pleasant and courteous manner with customers. And, unknown to the religious constituents called, the firm maintains it does not insist that any employee who makes informational and fundraising calls adhere to a specific religious doctrine or system of belief. Still, the firm's employees who place calls from its "Christian phone center" are considered people who take on the identity of the nonprofit religious organizations whose constituents they call. Although the firm asserts that its preemployment inquiry does not seek information about an applicant's religious beliefs, as that would constitute religious discrimination, it demands that "willingness to pray with a caller on the phone in the Christian phone center is an essential part of the job."

Religious fundraising has not only taken on the role of big business in the telemarketing field, it also bears the marks of deceit. The Federal Trade Commission estimates that 10 percent of the $143 billion given to charities in a given year may be used or misused or end up in the pockets of fraudulent solicitors. Since mega-millions are donated to religious charities, clearly serious abuses occur in this arena.

Contributors to any nonprofit religious organization including those within the para-church movement who often present themselves as standing for truth need to heed the advice of the caveat applied to consumers in the for-profit marketplace: let the donor and society beware.

A.H. Barbee, Ph.D. is a researcher in nonprofit religious organizational behavior.

© 1998 Institute for First Amendment Studies, Inc.