Nova Scotia fundraising company banned from Sobeys
For-profit fundraisers not illegal but raise 'red flags' says charity expert
A company from Bedford is no longer collecting donations at Sobeys stores, after a CBC News investigation into the practices of Impact Industries and other similar firms.
Impact Industries fundraises for the Breast Cancer Society of Canada. A CBC investigation found it's one of a number of companies operating in malls, department stores and grocery stores, where managers are often unaware sellers are working for private, for-profit companies.
In Nova Scotia, Impact Industries sets up tables, decorated with pink banners for the Breast Cancer Society of Canada. Representatives sell a range of products, including makeup, handwarmers and hair straighteners.
Last month, CBC News visited Impact sales tables at a Sobeys store in Tantallon and a Walmart in Bedford.
Since then, both Sobeys and Walmart have cracked down, reminding managers that only non-profit groups are permitted to fundraise in stores.
"Impact Industries did fundraise on behalf of the Breast Cancer Society of Canada in our Tantallon store for one weekend in February," Shauna Selig, a spokesperson for Sobeys, told CBC News.
"Their request to return to the store was declined."
Alex Roberton, director of corporate affairs for Walmart Canada, said the company "supports organizations that are either a charity, a registered charity or a not for profit. Period. And 100 per cent of the money raised has to go to a charity."
'Best to avoid'
The Breast Cancer Society of Canada has a corporate partnership with Impact Industries. It receives 10 per cent of product sales. The rest goes to the company and employees, who are paid on commission.
Charities are best to avoid these scenarios.- Mark Blumberg
A former employee of Impact Industries, Billy Malamud St. Pierre, says his commission was about 30 per cent of sales of automobile cleaning products.
Malamud says he would tell customers that he worked for a third party marketing company if he was asked. But if he wasn't asked, "I didn't say it."
There's nothing illegal about using commission salespeople to raise funds for charity. But Mark Blumberg, an expert in registered charities, says the practice does raise a red flag.
"Charities are best to avoid these scenarios," said Blumberg. "It really incentivizes some practices that aren't for the benefit of the charity sector."
The Breast Cancer Society says it's received $20,000 in donations since its partnership with Impact Industries began in September 2013.
The society says it is open and honest about its corporate partnerships and says, "if any consumer has concerns about the charitable claims linked to the sale of a product we recommend that they do not purchase the product."
The society is a small charity, based in Sarnia, Ont., and is not affiliated with the Canadian Breast Cancer Foundation.
In a statement, the owner of Impact Industries said his company is not a fundraising company and his salespeople are not fundraisers.
Richard Soucy said his company is a "sales and marketing company that chooses to give 10 per cent of our product sales to the charities we develop corporate sponsorship agreements with."
"We respect the decision of others if they prefer to handle matters in a different way than we do," Soucy said in a statement.