First Charity Faces Closure Under VIC Legislation

The Victorian Director of Consumer Affairs has warned a Melbourne-based charity that it faces deregistration over fundraising activities – the first time that the discretionary fundraising laws have been used in that state – and the story has made headlines overseas.

Consumer Affairs Victoria has issued the warning to the Children’s Cancer Institute Australia for Medical Research (CCIA) after questions were raised about a fundraising event in Melbourne in which Cherie Blair, the wife of the UK Prime Minister was guest speaker.

Under the Victorian Fundraising Act, a condition of the charity’s registration is that it must direct 60% of proceeds from any fundraising effort back into cancer research.

Consumer Affairs Victoria received information alleging that CCIA had breached this condition, in conducting a dinner on 10 February 2005 attended by Mrs. Blair.

Consumer Affairs says that it has confirmed that the total gross fundraising appeal proceeds raised were $192,114.51.

Of that, only $15,800 or 8.22% of gross appeal proceeds were made available to the beneficiary, identified as Cancer Research conducted by Children’s Cancer Institute Australia.

Consumer Affairs Victoria confirmed that $176,314.51 (91.78%) was absorbed in the paying for this dinner and guest speakers.

Consumer Affairs Victoria is concerned that this appeal was conducted in breach of a condition placed upon CCIA’s registration. It says CCIA failed to notify Consumer Affairs Victoria when it became apparent that this condition would not be met and did not seek to modify the condition at any time.

In response to a statutory demand for information, CCIA initially indicated that 22.1% of gross appeal proceeds would be made available to fund cancer research.

Consumer Affairs Victoria used its statutory powers to require CCIA to produce and lodge audited accounts in relation to the dinner and show cause why less than 10% of the dinner’s proceeds went to charity.

Consumer Affairs Victoria is also concerned that CCIA failed to disclose that it had engaged a commercial fundraiser to assist in conducting the dinner at which Mrs Blair was a guest speaker and received a significant fee of $50,000 for arranging this event.

Event organiser Max Markson has said in several media interviews that he did not receive any money and that his firm had waived its fee. He added that it had all been totally transparent and they had nothing to hide.

Consumer Affairs Victoria has called on CCIA to show cause why it, in light of the information provided it would be in the public interest to allow CCIA to remain registered as a fundraiser under the Act.

The controversy surrounding the children’s cancer charity fundraiser and Mrs. Blair resulted in headlines in the UK press.

The UK Guardian says the children’s cancer charity paid Cherie Blair more than £100,000 to speak at a series of fundraising events in Australia and could be deregistered after only a small portion of the proceeds went towards cancer research.

The Children’s Cancer Institute of Australia is due to show why it should not be banned as a charity in the state of Victoria.