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FOR IMMEDIATE RELEASE
February 17, 1999
AG's Stops Fraudulent Fund-Raising


SEATTLE - February 17, 1999 - An Issaquah man who falsely claimed the proceeds from the sale of discount coupon books would be used to help local troubled and homeless youth, then used the funds to support himself and his own children, has been closed down by the Attorney General's Office.

Peter Militello of Issaquah allegedly recruited and used local high school students to sell the coupon books offering discounts to restaurants and businesses in Issaquah and Renton. Many of those business had never been contacted by Militello and offered no discounts.

Although the so-called charity had no relationship with either Issaquah or Eastlake High Schools, students selling the coupon books were instructed to tell people the program was affiliated with the schools.

“None of the money collected from the sale of these coupon books went to help youth, except Mr. Militello's own children,” said Attorney General Christine Gregoire. “Our investigation revealed almost all the money was used for personal expenses and there was no youth program at all.”

Militello signed a Stipulated Judgment, in which he agreed to stop soliciting for funds, pay $7,000 to a legitimate youth charity and reimburse the state $2,000 in legal fees and costs. If the agreement is violated, $14,000 in suspended civil penalties could be reinstated.

“This was your basic grassroots fraud,” said Gregoire. “With a computer and a graphics print program this guy created a charity. Slick, professional materials don't make the charity legitimate.”

Gregoire encourages consumers to check out a charity and the fund-raiser before giving any money. If a solicitor says they're associated with a school or other public agency, verify it by contacting that organization directly. Consumers should also make sure the charity is registered and ask what percentage of their donation will go to the charitable cause by calling the Secretary of State at 1-800-332-4483.

In other action, the AG's office also settled a lawsuit filed last November against Rainbow Connection Publishing and its owners John and Valerie McNew of Seattle. They raised money on behalf of several organizations including Holiday Basket Fund and Little Miracles.

The fund-raiser has agreed to pay penalties and stop making misrepresentations during solicitations, including claiming that as much as 65% of the money donated would go directly to the charitable purpose and using invented religious titles for solicitors such as “Brother Olaf” and “Sister Owen.”

To file a complaint contact the Attorney General's Office at 1-800-551-4636. To check out a charity, contact the Secretary of State's Office at 1-800-332-4483.

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