"In late 2025, the donation platform Flipcause collapsed, leaving 3,200 nonprofits with a collective $29 million hole in their budgets while the platform's executives pocketed millions before going bankrupt."
"GoFundMe was caught launching 1.4 million fundraising pages in nonprofits' names without consent, tacking on fees the organizations never authorized."
"Regulatory oversight of charitable fundraising platforms is, in most of the country, light to nonexistent."
"California became the first state to pass a law establishing requirements for fundraising platforms, which took effect in 2024."
Nearly $600 billion is donated to US charities annually, with increasing online giving managed by for-profit companies. This reliance on intermediaries creates a power imbalance, risking nonprofit missions when these companies prioritize their interests. Regulatory oversight is minimal, leading to vulnerabilities, as seen in the collapse of Flipcause, which left nonprofits with significant financial losses. California and Hawaii have begun implementing regulations, but most states lack similar protections, leaving nonprofits exposed to potential exploitation.
Read at Nonprofit Quarterly | Civic News. Empowering Nonprofits. Advancing Justice.
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