Know Your Options When Giving to the Red Cross

In the wake of any humanitarian disaster that hits the U.S., the American Red Cross (Red Cross) usually takes the lead in providing immediate and long-term disaster relief services. The Red Cross, though, has not been immune from criticism related to how it solicits and allocates the spending of donations in direct response to major disasters. Thanks to an October 23, 2013 agreement with New York's Attorney General, however, donors now will see new language describing the giving options available on the donation page of the Red Cross' website. The objective of this new website language is to help ensure that the Red Cross honors the intent of its donors with respect to how their contributions are used and to provide transparency about such uses, according to the agreement.

There are four basic options when giving to the Red Cross in the aftermath of a disaster:

• Donate to "Where It Is Needed Most," which will go to the Red Cross' general fund. The website describes the use of this donation as, "Support all of the urgent humanitarian needs of the American Red Cross." During a major disaster, Red Cross will omit the use of the word "urgent" from the website description.
• Donate to "Disaster Relief," which will "Help people affected by disasters big and small" according to the website description. Such donations will be used for relief services for the tens of thousands of disasters to which the Red Cross responds every year.
• Donate to "Your Local Red Cross," which will "Provide for local Red Cross programs and services in your community" according to the website description.
• Donate to a specific disaster, which has to be done by check with a mail-in donation form that can be found via a link provided on the donation page of the Red Cross' website. The donation form allows donors to specify the cause to which they want to donate and also provides donors with handling choices if the Red Cross is not raising funds for the specific cause the donor indicates and/or if donations received already exceed the Red Cross' expenses for that specific cause. The handling choices provided are either for Red Cross to apply the donation to different disasters, or for Red Cross to return the check to the donor. CharityWatch suspects that the Red Cross prefers that you do not use this option of donating to a specific disaster so that it will have more flexibility with regard to the use of your donation.

In addition, the Red Cross has agreed that, in the case of all major disasters, it will conduct a periodic assessment to determine whether it will no longer actively raise funds for that disaster and/or that it has received donations designated for that disaster that surpass its anticipated expenses for the disaster. If a "yes" determination is made to either circumstance, within two days thereof, the Red Cross will stop making all references to the major disaster in all of its own fundraising solicitations and telephone operator scripts. Also within the two days, the Red Cross will let its partners know that they must immediately stop the use of Red Cross disaster-specific fundraising solicitation language and will provide them with revised fundraising guidance and/or substitute materials that can be use instead. At all times, including after major disasters, the Red Cross also will refrain from making reference to any specific disaster in the solicitation language used on the donation page of its website.

All donations that are made by phone or text in response to Red Cross solicitations or appeals that refer to a particular major disaster will be allocated to that major disaster, as the Red Cross has done in the past. The same also is true for all donations made in response to a telethon appeal that refers to a particular major disaster. The Red Cross also will continue its practices of issuing public stewardship reports following major disasters and conducting internal review/lessons learned sessions and internal audits after every major disaster to evaluate the relief and recovery response and plan for the future.