Michigan Attorney General Dana Nessel joined a bipartisan coalition of 28 attorneys general urging GoFundMe to adopt better disclosure policies and greater clarity in terms of service for consumers who use its platform.
According to GoFundMe’s website, the platform has served over 50 million donors and helped organizers raise more than $5 billion since its launch in 2010. Individuals, businesses, and charities pay a fee between 2.2% and 2.9%, plus $0.30 per transaction, but information on the terms of service and policies – particularly related to blocking, freezing, refunding, and redirecting donations – is hard to find and unclear on the site.
“While crowdfunding sites like GoFundMe have become a great resource in times of need and tragedy, it remains imperative there are checks and balances in place to protect and inform those using the site,” Nessel said.
“I stand with this bipartisan coalition in urging GoFundMe to revisit its approach to transparency with users.”
As the attorneys general state in their letter, “[P]latforms like GoFundMe are not and should not be empowered to unilaterally make decisions regarding where donated funds will go or why. If GoFundMe is making opaque and unilateral decisions about which fundraisers are legitimate and which fundraisers to re-route donations to irrespective of initial donor choice, GoFundMe has likely crossed the line from fundraising platform to fundraiser itself.”
The coalition asks GoFundMe to take the following steps in its letter:
1. Explain in detail how GoFundMe investigates or analyzes fundraisers on its platform, and what criteria GoFundMe uses to determine whether those fundraisers are fundraising for acceptable purposes or not.
2. Explain in detail how GoFundMe determines whether to block, freeze, redirect, or refund donations, and what criteria GoFundMe uses to decide which avenue to take.
3. Explain in detail how GoFundMe handles donations when GoFundMe decides to (i) block donations, (ii) freeze donations, or (iii) redirect donations.
4. Review policies and Terms of Service to ensure that donors are adequately and conspicuously informed at the time of their donation of the circumstances under which their donation may be blocked, frozen, redirected
or refunded without their authorization.
5. Explain in detail the meaning of the term “unacceptable” in the context of your Terms of Service and describe whether there are additional internal policies defining it.
6. Articulate any steps being taken in the form of a responsive letter or a meeting with the undersigned attorneys general.
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