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 Telemarketing is a tool for many industries. It’s heavily used by sales organizations for business-to-business work. It’s also used extensively by local businesses looking to drum up new customers. Politicians, of course, use it to get voters out and raise campaign funds, and survey and marketing companies use outbound calling to poll large numbers of people.

One of the most “noble” uses of telemarketing, however, remains for not-for-profit fundraising, often by charities. Because these efforts are widely seen as valuable, charities – or the companies doing fundraising on their behalf --  are often exempt from rules that normally govern telemarketing. (They don’t need to buy and obey “do not call” lists, for instance.)

The question of whether not-for-profit organizations should be exempt from the rules of telemarketing becomes of vital importance when you consider that not all charities are doing the “noble work,” or at least not much of it. In many cases, the charity itself may be honest, but the company it engages to do the telemarketing on its behalf is pocketing too much of what it collects.

According to a new report commissioned by New York State Attorney General Eric Schneiderman, “Pennies for Charity,” charity telemarketing campaigns kept 62 cents out of every dollar raised in 2012. Telemarketers registered in New York recorded $249 million in contributions in that year, and they pocketed $154 million of it.

In fact, half of the charity telemarketing campaigns run in 2012 saw the fundraising organizations keep 70 percent of more of what was raised, according to a recent article by Joseph Spector in the Poughkeepsie Journal.

“New Yorkers who open their hearts and wallets deserve to know how their hard-earned dollars are being spent and how much of their money is going to pay telemarketers’ salaries and costs,” said Schneiderman in response to the report.

The truth of the matter is there are no rules and regulations governing how much a telemarketing company must turn over to the not-for-profit it’s working for.  Many charities simply do not have the funds or manpower to run their own campaigns, so they rely on professional telemarketers, not all of which are honest players.

Doug Sauer, CEO of the state Council of Nonprofits, told the Poughkeepsie Journal that he encourages charities to not use telemarketing firms if possible. He said the state should regulate the industry to ensure that only a certain portion of the money raised can go to a telemarketing company.