St. Louis, Mo., July 17, 2013 – The luxury home featured as the top prize in a highly publicized St. Louis Dream House Raffle turned out to be just that – a dream.
The owner of the $1.8 million home told the Better Business Bureau (BBB) that the Colorado charity that sponsored the raffle has notified him that it did not sell enough tickets to exercise an option to buy the house and award it to the winner.
“They said they wanted to thank me for the use of my home,” said the home’s owner. National Wheelchair Basketball Association (NWBA) of Colorado Springs, Colo., sponsored the raffle.
On March 26, the BBB alerted the public to a contest rule that said the house would not be awarded unless at least 45,000 tickets were sold. If fewer tickets were sold, the grand prize would be a lesser cash prize, based on ticket sales. While that disclosure was included among a listing of rules and regulations on the St. Louis raffle website, it was not mentioned in a raffle advertising and marketing campaign that reached thousands of homes in Missouri and Illinois.
Typical of the ads was an 8-page brochure showing several photographs of the Chesterfield home. The front showed a photo of the home and said: “Win this $1.8 Million St. Louis Dream House or choose $1.3 million in cash.” On Feb. 14, an NWBA news release began: “Some lucky person with a $150 raffle ticket will win an exquisite $1.8 million St. Louis dream home or $1.3 million cash.” Neither the brochure nor the news release disclosed that awarding the house was contingent on ticket sales. Both marketing pieces referred ticket buyers to the raffle website.
Michelle Corey, BBB president and CEO, said that even though the charity focused the raffle campaign extensively on the Chesterfield house, charity officials knew there was a chance they would not sell enough tickets to award the house.
“It certainly seems strange that a charity would promote a ‘St. Louis Dream House Raffle’ and then not award the house,” she said.
In addition, the BBB is criticizing the NWBA for what it sees as a “continuing and troubling lack of transparency” surrounding the raffle.
Corey said the NWBA has continued to withhold information about how it spent money raised in the raffle. Corey said that decision “serves neither the interests of the public nor the charity. At a time when charity accountability and transparency is so important, financial secrecy simply is not in the best interest of the donating public.”
Carole Bellman, BBB charity review director, said, “Tax-exempt organizations like the NWBA have an obligation to open themselves to public inspection and scrutiny. When they do not, they risk alienating their own supporters.”
The intense marketing campaign for the house raffle included TV and newspaper ads and direct mail materials promoting ticket sales for the dream house raffle. In addition to the house, prizes included automobiles, exotic vacations and cash.
Advertising identified former Cardinals player Ozzie Smith as raffle spokesperson.
More than a month after the June 8 grand prize drawing, the NWBA has not revealed to the public how it spent proceeds from the raffle, despite several requests from the BBB.
On June 14, the BBB asked the charity for:
- The full name and contact information for the grand prize winner and the prize awarded to the winner. (Contest rules required that contest winners allowed their “names and/or likenesses” to be made public.)
- Information on the number of tickets sold and the amount of money raised from the raffle.
- A breakdown of how money raised in the raffle was spent.
- Details showing that the grand prize drawing was fair and unbiased.
Specifically, the BBB asked for an accounting of how much of the money was spent on prizes, how much went to pay for media purchases and related marketing efforts, how much was paid to outside consultants and how much went to the charity for its charitable programs.
Randy Schubert, the NWBA’s executive director, responded in an email to the BBB that “based on our original discussions this spring and the way (the BBB) chose to portray the information, I would like to communicate with your board of directors and speak with your executive director prior to any potential further dialogue.”
The BBB’s Corey invited Schubert to contact her directly, but he has not done so. Nor has the charity responded to the BBB questions.
The March 26 BBB alert also expressed concerns over what the BBB saw as a lack of openness by the NWBA. Among the BBB’s concerns was the charity’s unwillingness to detail its involvement with its fundraising consultant, Raffle Administration Corp., which was involved in the St. Louis house raffle. Raffle Administration is headed by Neal Martin-Zeavy of San Francisco.
The NWBA says it coordinates and promotes wheelchair basketball around the world.
The BBB’s Wise Giving Alliance has asked the NWBA for information that would allow it to evaluate the charity under the BBB’s 20 Standards for Charity Accountability. The NWBA has not responded to the request. Participation in the BBB program is voluntary.
The “dream house” publicized by the raffle is the private residence of Frank “Bud” Miceli, head of Miceli Custom Homes. Miceli said NWBA had contracted with him to hold the house until July 1, in return for a fee. Miceli declined to disclose the fee.
“I just optioned my house and kept my fingers crossed that it was going to work out,” Miceli said. He said all of the negotiations were handled by Raffle Administration Corp. “If I had it to do over, I don’t know if I would.”
The raffle website, www.stlouisraffle.com, lists all raffle winners by first initial, last name and community. The grand prize winner is identified as Maureen T. of Ferguson, Mo.
The BBB offers these tips for persons considering buying tickets to a charity raffle:
- Research the charity carefully before participating. Go to its website and read about its work; ask the charity for financial information. Contact the BBB for a Charity Review by going to www.bbb.org or by calling 314-645-3300.
- Spend only what you can afford to lose.
- Ask whether the charity is using a professional fundraiser to assist in the raffle and how much of the ticket price will actually go to the charity for its programs.
- Find out when the winners will be announced and make sure the drawing is held at that time.
- If you are interested in ensuring that the charity gets the largest percentage of your money, it is always best to make a direct contribution to avoid fundraising expenses.
Contacts (News Media Only): Michelle Corey, President & CEO, 314-645-0606, email@example.com, or Chris Thetford, Vice President-Communications, 314-584-6743, firstname.lastname@example.org, or Bill Smith, Trade Practice Investigator, 314-584-6727, email@example.com