Association of Fundraising Professionals - Rhode Island Chapter
Sunday, June 25, 2017
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States Seeking to Protect Donor Privacy as Anonymous Gifts Increase

(Jan. 21, 2008) Anonymous giving is suddenly in the spotlight as a new study shows an increase in major gifts made anonymously, while several states are moving to protect donor privacy.

The Wall Street Journal reported (“Why Donating Millions Is Hard to Keep Secret,” Jan. 9, 2008) that 37 gifts of at least $5 million were made in 2007 by anonymous donors, according to an analysis made by the Indiana University Center on Philanthropy. Twenty-seven such gifts were reported in 2006 and only 13 in 2004. According to the article, donors chose to remain anonymous for a number of reasons, including:

  • Religious beliefs that anonymous giving is more sincere or a “higher” form of giving
  • Jealous relatives who would like to see family wealth used in other ways
  • Increased solicitations from other charities if the donor is revealed publicly
  • Personal safety, with worries that individuals might be targeted by criminals if a gift is made public

The article also notes that with increasing concerns about publicity, many major donors have turned to donor-advised funds. Giving through a donor-advised fund allows the donor to give to a charity in the name of the entity that runs the fund, typically a financial-services firm.

States Protecting Information

At the same time, several states have made or are in the process of making changes to their privacy laws to safeguard information about donors to public higher education institutions.

The Virginia legislature is currently considering legislation that would exempt public higher-education institutions in the state from some of the requirements of the Freedom of Information Act. Under the bill, information about anonymous donors would not have to be disclosed, and data on other gifts would be limited to the donor’s name, the size and date of the contribution and for what the contribution was designated.

According to The Wall Street Journal article, Colorado and Georgia have recently passed similar laws to keep anonymous donors’ names private, while the Kentucky State Supreme Court is deliberating on a lawsuit from a local newspaper that would require the University of Louisville Foundation to reveal the identities of 62 anonymous donors.

Advocates of disclosure agree that personal information should be withheld, but argue that the name of anonymous donors should be disclosed, citing concerns about favoritism in admissions, procurement and hiring.