What’s going on, briefly? The British Information Commissioner’s Office’s (ICO) levied substantial fines against two large and well-respected British charities, publicly berated and shamed them for – amongst other things – conducting wealth screenings and prospect research. It’s a very worrisome time in the UK for our colleagues right now, and the fundraising community over here should take note – and provide moral support.
More on this developing story will be found here on the Intelligent Edge, but in the meantime, please take a moment to visit the Further Reading section at the end of this post to get yourself caught up on the ICO ruling and the UK fundraising community’s reaction to it.
Screenings are fraught over here, too, but not in the same way…yet
A client lamented to me this week about the faults of their recent wealth screening. She told me that, on looking at the initial reports, her board has completely discredited the entire screening results because a certain wealthy person whom they all know came back as a big fat zero for assets.
After looking into the screening’s results on that person, here’s what I told her to pass along to her board about why wealth screenings turn up results that, on the face of things, seem laughably incorrect.
The wealthy guy she brought to my attention I’ll call Avery Wealthyman, and I’ve anonymized all the information about him in this post, but he’s real. Mr. Wealthyman is well known in a major city’s philanthropy circles. A senior executive of a financial institution, he lives in a tony suburb of the city. His spouse, who comes from a recognizably-named family, is a board member of and donor to a prestigious arts organization (among other affiliations).
Backing up to Prologue, just for a minute
To briefly recap previous discussions: wealth screenings electronically match A to A. If A sees a, it’s not a match. Even if it’s really just an A that someone forgot to capitalize.
An organization provides a name and home address from their database to a wealth screening company. This demographic information is matched to information the screening company has aggregated in their database from public record sources and other vendors’ databases of aggregated information about that name at that address. That includes things like:
- A home’s assessed value. This comes from a town assessor’s record if it’s digitized and available to the public.
- If the person is a director or owner of a company. Public companies are required to publish how much their officers are paid and how much stock the top people own.
- If the person has made a philanthropic gift. Many nonprofit organizations publish a donor list on their website, so a screening company will match the name they’re given to names published on those lists.
- If the person has appeared in Who’s Who or directories with biographies like that.
- Vendors that aggregate demographic information from a bunch of sources and come up with statements like “people who live on Fayerweather Street tend to drive Volvos, support public television, and eat organic food.”
On to Act II
In the case of our prospect, Mr. Wealthyman, we know the following information:
- Their home at 44 Winthrop Street (I made that up) is – strangely – owned by the “88 Crescent Hill Trust” (I made that up, too). The contact person for the trust is neither owner, but an unrelated real estate superbroker who acts as their property agent.
- The company Mr. Wealthyman works for is privately-held. They’re not required to report any information about his compensation or his stock holdings, if any.
- His wife goes by her maiden name, so donations she makes under her name will not (necessarily) be attributed to her husband as well on donor lists.
So that’s how the screening will come up completely empty on someone that everyone knows is a multi-millionaire.
Act III – How to fix your lousy wealth screening results
Which is why having an experienced prospect researcher on your side to help tease apart all of these loose threads is so important.
A researcher will know to visit the assessor’s office website to find and track down the property ownership as I described the process above, and will also think to see if there are any other properties owned by that trust. (there were!)
They will also know to look in newspaper archives to find articles about the financial company and its executive compensation, as well as anything about the spouse’s past family holdings. (like more real estate!)
And the list goes on.
Act IV – Moving from dismal results to adding real future value
These days, wealth screenings are not so great about turning up assets for people who have professional lawyers, accountants, and financial planners helping them keep their asset information off the public record. Very wealthy people have become much more savvy about this in recent years, which makes retaining a professional researcher to help do the manual, in depth work, even more important.
But now we find that wealth screenings are actually pretty great at turning up information about middle donors and up-and-coming prospects – those people that you should be cultivating today for major gifts in 5, 10, or 15 years from now.
So keep on screening, and give a prospect researcher your screening results to verify and analyze. You’ll get better results on the people you know have more wealth, and start to identify the base for your organization’s fundraising future.
For Further Reading:
ICO Rulings and Database Screenings, by Nicola Williams, Factary
A response to the ICO’s findings that RSPCA and British Heart Foundation broke data protection laws, by Christian Propper, Graham Pelton
Opinion: Does The ICO Have ‘Unreasonable’ Expectations About Wealth Screening?, by Ian MacQuillan, Rogare
Why the ICO’s rulings are a job half-done, by Daniel Fluskey, Institute of Fundraising
Why the ICO and its investigation into charity data practices is completely self-defeating, by Matt Ide, Giving Insight
In Defence of the Public Domain, by Chris Carnie, Factary
Isn’t that a bit illegal? by Susie Hills, Graham Pelton
We need to talk about money. A response to the ICO fines on RSCPA and BHF, by Adrian Beney, More Partnership