Five Legal Issues You Need To Consider When Running A Fundraiser

Last Updated on October 7, 2021

You’re probably already aware that as an event management professional, there are certain laws you need to adhere to, and regulations of which you need to be aware. Ignorance of the law simply isn’t acceptable – particularly if you want to keep both your firm and your clients out of legal hot water. That’s double true for charity events, which tend to have certain legal strictures surrounding them that don’t need to be considered for other events.

Although the laws of each country and region vary, they tend to share certain generalities between them. Today, we’re going to take a look at those. Here are a few legal issues you’ll need to take into account if you want your charity event to go off without a hitch.

Fundraising Registration

In most states, fundraising activities are regulated by state law. What this means is that your organization – or whatever charity you’re associating with – may be required to register with the state before you engage in fundraising activities there.  If you’re working with a not-for-profit, there are often additional laws you’ll need to be aware of, as well. If you don’t know what the laws are in your particular state, you can check out Laws for Change.

Professional Fundraising Consultants

In addition to requiring registration and a particular code of conduct, some regions may additionally require any ‘professional fundraising consultant’ associated with an event to register with the state. What that means is that if you’re the one running the fundraiser – if you’re the ‘consultant’ associated with the fundraising organization – then you may have to register with the state, or face charges for being unregistered.

Gambling/Liquor Licenses

It should go without saying that if you’re hosting a raffle of some sort of serving any kind of alcohol; you’re probably going to need to register for a license with the host state. Check out the website associated with your state or city government and you should be able to find information related to the registration process fairly easily.

Vicarious Liability

One thing fundraisers share in common with virtually every other event is that you need to account for liability – your own, your client’s, and any other partners associated with the events. For this, I’d actually recommend hiring a lawyer to draft up contracts detailing who’s responsible for what. Otherwise, you might find yourself liable for the damaging actions of one of your partners or volunteers. 

Other Legal Quandaries

In addition to what’s already been covered here, there are a few other legal concerns you’ll need to account for if you’re managing a charity:

Your organization may need to submit a disclosure statement related to the event, establishing that it’s complied with all state registration requirements and alleging you’re following all associated laws to their fullest. In the following states this is required: Georgia, Florida, Colorado, Illinois, Maryland, Michigan, New Jersey, New York, Pennsylvania, Virginia, Washington State, and West Virginia.

All organizations associated with your event may be required to report any revenue-sharing as a ‘commercial co-venture.’

All materials associated with your event must be truthful and transparent.

The law in many states is still somewhat unclear regarding how fundraising works on the Internet. Familiarize yourself with how the law works in your State.