AG Files Suit Against Charitable Fundraisers As Part of a Nationwide Fraud Sweep

SEATTLE - Nov. 12, 1998 - The Attorney General's Office today filed lawsuits against three charitable fundraisers for misleading the public about donations they solicited on behalf of several charitable causes. The lawsuits are part of a nationwide crackdown on charities fraud called Operation Missed Giving that involves 40 states, the Federal Trade Commission, and the American Association of Retired Persons.

“Washington Citizens willingly gave money believing it was being used to support legitimate causes,” said Attorney General Christine Gregoire. “These organizations used unscrupulous tactics that left both the consumers and charities victimized.”

Today's lawsuits were filed against:

• City of Troy, Inc. and its owner, Troy Emerson, for allegedly misrepresenting the percentage of donations they forwarded to charities, for implying that telemarketing representatives were actual volunteers or employees of client police organizations, and for failing to make required disclosures, such as the name of the charitable fundraiser. In the past, City of Troy has raised money for the Seattle Police Officers' Guild and other local police organizations.
• King County Foster Parent Association and its executive director, Sheron Carey, for allegedly raising hundreds of thousands of dollars by falsely claiming donations would pay for scholarships for foster children and counseling and support for foster parents. In fact, some of the money was used for parties, and much of the rest remains unaccounted for. The King County association should not be confused with the Washington State Foster Parents Association, another organization whose fundraising efforts have not been challenged.
• John McNew and Valerie NcNew (doing business as Rainbow Connections and Little Miracles) for allegedly misrepresenting the percentage of donations that would go to their own charitable organization and two other charities, Helping Hands and Holiday Basket Fund, for whom the McNews were serving as commercial fundraisers. Among other things, the McNews allegedly claimed funds raised for Helping Hands would be used to provide holiday food baskets for the poor, when in fact only 3 percent of the money raised in 1996 was used for that purpose.

As part of the nationwide sweep on fundraising scams, the states and the FTC have initiated dozens of enforcement actions targeting the deceptive activities of fundraisers that misrepresent ties to legitimate police departments, firefighters, veterans' groups, youth-related health organizations and other groups. Gregoire, along with the FTC and AARP, urged Washington consumers to ask the following questions before giving to a charitable fundraiser or organization, and to make efforts to verify the answers:

• Is the charity or fundraiser registered with the State of Washington?
• What is the name, address and telephone number of the organization asking for the donation?
• Exactly how will the donation be used?
• What percentage of the contribution will actually be spent on the charitable purpose of the organization?

In addition, Gregoire recommended that consumers refrain from giving money to fundraisers or charities without first obtaining written materials regarding the charitable cause.

Volunteers from the AG's Office, the Secretary of State's Office, AARP and the FTC today will be calling seniors and others on telemarketing lists to remind them to check charities before giving money. This “reverse boiler room” will be operated in the AG's Seattle and Spokane offices from 9-11 am.

Consumers are encouraged to visit the AG website at www.atg.wa.gov to learn more about giving wisely to charities and how to protect themselves. Anyone wanting to file a complaint about a charitable solicitation should send an e-mail to the Attorney General at protect@atg.wa.gov or call 1-800-551-4636.

To check on a commercial fundraiser or charity, call the Secretary of State's Charities Information Hotline at 1-800-332-4483 (360-753-1485 for the hearing impaired), or e-mail a request to charities@secstate.wa.gov. An on-line search of charities registrations, consumer tips and statutes regarding charitable solicitations are also available on the Secretary of State's website at www.wa.gov/sec/charities.

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