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Re: America's Worst Charities, by Kris Hundley and Kendall T

PostPosted: Tue Jun 24, 2014 3:10 am
by admin
PART 9
Lawmakers agree on legislation to crack down on fraud by Florida charities
by Steve Bousquet, Times/Herald Tallahassee Bureau

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Tuesday, April 29, 2014 6:48pm

TALLAHASSEE — The Senate and House struck agreement Tuesday on legislation to crack down on fraud by Florida charities after agreeing to drop a proposed $50 application fee for criminal background checks on solicitors.

Instead, taxpayers will pay for the background checks.

The legislation is the most significant tightening of the laws overseeing charitable solicitations in Florida in two decades and is a rare case of increased government regulation by a pro-business, free market-oriented Republican Legislature.

Agriculture Commissioner Adam Putnam has called Florida "a destination of choice for hucksters," and lawmakers embraced his call for new laws after reading an investigation by the Tampa Bay Times and the Center for Investigative Reporting called "America's Worst Charities," which exposed rogue charities that pocketed millions of dollars in profits under the pretense of raising money for veterans or sick children.

The legislation adds new reporting requirements for charities and bans them from Florida if they've been cited for fraud or other crimes in other states. Charities that raise more than $500,000 a year must have their financial statements reviewed by auditors and charities that collect more than $1 million must be audited.

Charities that raise $100,000 in response to a disaster, such as a hurricane, tornado or wildfires, must file quarterly reports with the state.

"It adds a lot of transparency and accountability," said Rep. Jim Boyd, R-Bradenton, sponsor of the House bill. "It holds people accountable who are acting inappropriately. The news stories were instrumental in breaking open the issue."

The House version (HB 629) included a $50 individual application fee, but Boyd said Gov. Rick Scott's office raised objections to the new fee, so it was taken out when the bill came up on the Senate floor Tuesday afternoon.

"I personally felt that the fees were reasonable, and we have fees attached to a lot of other business services in Florida," Boyd said. "But certainly if he felt there was a need to take it out for the good of the cause, I support that, because the bottom line is that we get our hands around the issues that have been created by these rogue charities."

Sen. Jeff Brandes, R-St. Petersburg, sponsor of the Senate bill, said that throughout the session, lawmakers have broadly tried to prevent new fees on consumers from being attached to any bills. "It's an ongoing concern," Brandes said.

The revised bill allocates about $416,000 from the state treasury to hire three full-time employees in Putnam's Department of Agriculture and Consumer Services to oversee the checks, which include mandatory registration and fingerprinting for people who work for telemarketing firms hired by charities to raise money.

Brandes emphasized that the background checks do not apply to people who serve without pay as volunteer fundraisers for charities.

The Senate is expected to pass the revised bill today and will send it for a final vote in the House, which will send it to Scott's desk.

Lawmakers agree on legislation to crack down on fraud by Florida charities 04/29/14 [Last modified: Wednesday, April 30, 2014 9:15am]

© 2014 Tampa Bay Times

Re: America's Worst Charities, by Kris Hundley and Kendall T

PostPosted: Tue Jun 24, 2014 3:10 am
by admin
PART 10
New law will give regulators more oversight of charities
by Kris Hundley, Times Staff Writer

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Sunday, May 25, 2014 9:21pm

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SCOTT KEELER | Times (2013)This telephone line in the Iowa Attorney General’s office is answered by a staff member who records telemarketers’ pitches. The recordings can later be used to bring lawsuits against charities and telemarketers for making misleading statements.

Telemarketers with criminal backgrounds will no longer be able to call Floridians for charitable donations.

Nonprofits and professional solicitors banned in one state will be banned in Florida as well.

And consumers will be able to go online for more details about how a charity uses its donations under a bill Gov. Rick Scott is expected to sign into law.

Lawmakers proposed the sweeping changes following a yearlong investigation by the Tampa Bay Times and the Center for Investigative Reporting that ranked the worst charities in America based on which groups spent the most on professional solicitation companies. Of the 50 charities with the worst records, 11 were based in Florida, more than any other state.

With the reforms, Florida will have the tools to transform itself from one of the nation's most lax charity regulators to among the most aggressive. And because the rules apply to any organization that raises money in Florida, the impact of the changes could be felt nationwide.

Ken Berger, president and chief executive of Charity Navigator, an industry watchdog group, praised the changes, saying, "I'm in favor of anything that provides further enforcement and oversight to eliminate unethical and fraudulent behaviors."

The pending law gives Florida's Department of Agriculture and Consumer Services, which oversees more than 17,000 charities and 130 professional solicitors, additional manpower and stronger financial penalties for wrongdoers.

Three positions will be added, at a cost of about $415,000, to investigate charity-related complaints. Maximum fines will be increased to $5,000 for most violations and $10,000 for fraud.

The bill would also give Florida regulators the power to revoke a charity's state sales tax exemption for certain violations.

Bigger charities also will get additional scrutiny starting in July.

Under the new rules, charities with more than $500,000 in contributions will be required to have an independent certified public accountant review their finances; those with more than $1 million must publicly file an annual financial audit. Audits already are required by several states and give the public a more complete picture of a charity's finances, including related-party transactions, than its IRS filing.

All charities that raise donations in Florida would be required to file a financial statement that shows how much they spend on their mission. Any charity that raises more than $1 million but reports spending less than 25 percent on program services would be required to file additional information about salaries, travel expenses and fundraising costs.

The bill also gives regulators more time to check an applicant's record by extending the mandated turnaround time on annual registrations from 15 to 90 days. If the charity or fundraiser has had its right to solicit revoked in another state, Florida officials will be able to block the group from operating in Florida. Berger said he was not aware of any other state that had such a provision.

The Times/CIR report found at least a dozen cases where a charity or a solicitor had been forced out of one jurisdiction but continued operating elsewhere because state regulators don't systematically share information.

A spokeswoman for Agriculture Commissioner Adam Putnam's office said the department will rely on information from other states, as well as tips from media and charities to identify wrongdoers.

The bill also puts teeth into an existing law prohibiting people convicted of certain financial crimes from soliciting for charities.

Previously, employers were not required to do background checks of their employees. Under the new rules, such screening is mandatory for telemarketers who take donors' financial information.

Kris Hundley can be reached at khundley@tampabay.com or (727) 892-2996.

New law will give regulators more oversight of charities 05/25/14 [Last modified: Monday, May 26, 2014 8:35am]

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