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Attorney General Kwame Raoul announced a lawsuit against the Wheaton Historical Preservation Council (WHPC) and some of its board members for allegedly misusing charitable funds.

Raoul’s lawsuit was filed in DuPage County Circuit Court against the WHPC, its board president Alberta Adamson, as well as board members Gloria Leetz and Laurie Warfel. The lawsuit alleges that board members illegally transferred over $300,000 to Adamson and raises concerns about the WHPC’s storage of historical artifacts. In addition, the lawsuit alleges the WHPC is not registered with the Attorney General’s office, in violation of state law.

“The defendants allegedly took advantage of people who donated to the Wheaton Historical Preservation Council believing their donations would support the preservation of their community’s history,” Raoul said. “I filed this lawsuit to ensure that board members are held accountable, and my office will continue to hold individuals accountable for using charitable funds for their own benefit.”

The WHPC is a nonprofit organization responsible for preserving the history of the city of Wheaton, Illinois, including by maintaining a museum and collection of historical artifacts. Since the WHPC closed and sold the museum in 2017, the collection has been stored at a city-owned facility that is not accessible to the public. Raoul’s lawsuit is the result of an investigation the Attorney General’s office opened after receiving complaints about the preservation of historical artifacts and misuse of funds, including a $120,000 proprietary loan the council made to board president Alberta Adamson. The Attorney General’s office requested information pertaining to the historical artifacts, the loan to Adamson, and the council’s continued expenditure of funds after the museum was closed and sold. To date, the WHPC has failed to provide additional information.

According to the Attorney General’s lawsuit, the WHPC continued to fundraise and spend money even after the museum closed. The Attorney General’s lawsuit alleges Adamson has received approximately $300,000 from the WHPC since 2017. According to the Attorney General’s office, Adamson and Warfel attempted to characterize the $120,000 loan to Adamson in 2017 as reimbursement for a debt the WHPC owed. In addition to the loan, Adamson allegedly received $72,000 in 2018, which was characterized as rent paid after WHPC sold its property. Most recently in 2021, the WHPC allegedly paid Adamson approximately $109,303 for unknown purposes. Raoul’s lawsuit also alleges that the WHPC was not registered with the Attorney General’s office, although state law requires charitable organizations operating in Illinois to be registered.

The Attorney General’s lawsuit seeks to remove Adamson, Leetz and Warfel as WHPC board members. The Attorney General’s office is also seeking full accounting of the organization’s funds and is asking the court to hold the WHPC liable for all misused funds or those for which they are unable to account. Raoul’s lawsuit seeks additional injunctive relief.

Bureau Chief Barry Goldberg, Deputy Bureau Chief Kristin Louis, and Assistant Attorneys General Michelle Millstein and Matthew Shapiro are handling the case for Raoul’s Charitable Trust Bureau.

On December 1, 2021, the California Department of Justice will hold a virtual public forum on Assembly Bill 488, a new law governing charitable fundraising on internet platforms. The forum will provide the public with an initial opportunity to provide public comment and participate in the rulemaking process.

AB 488 amends The Supervision of Trustees and Fundraisers for Charitable Purposes Act, which vests the Attorney General with regulatory supervision of charities, charitable trustees, and other legal entities holding charitable assets or soliciting donations in California. AB 488 expands the Attorney General’s supervision to include “charitable fundraising platforms” and “platform charities.” Charitable fundraising platforms include charitable crowdfunding websites, e-commerce companies that solicit donations for charities on their websites or engage in online charitable sales promotions, and companies that provide customizable versions of their fundraising platforms to charities.

Effective January 1, 2023, charitable fundraising platforms and platform charities are required to: 

• Register and report to the Attorney General’s Registry of Charitable Trusts, which will be made available for public viewing;
• Provide conspicuous disclosures in certain solicitations, intended to prevent public deception, confusion, and misunderstanding;
• Promptly issue tax donation receipts, when applicable;
• Promptly distribute donations to charities;
• Only solicit for charities that have provided prior consent, unless certain criteria are met that safeguard against harm to charities and the public; and
• Only solicit for charities in good standing in California and with the IRS.

AB 488 also requires the Attorney General to adopt new regulations necessary for supervising charitable fundraising platforms and platform charities. Regulatory topics include:

• The content of registration forms and annual reports submitted by charitable fundraising platforms and platform charities;
• The requirements for holding and distributing donations, including the maximum length of time for promptly sending donated funds to charities;
• The circumstances under which the public may be notified when donated funds are sent to their selected charities; and
• The requirements for agreements between charities and charitable fundraising platforms or platform charities that provide consent for solicitations.

WHEN:
December 1, 2021, from 9:30 AM PT to 12:30 PM PT

WHERE:
A link to the virtual forum will be provided upon RSVP. Members of the public should RSVP to charities.regulations@doj.ca.gov. Members of the media should RSVP to agpressoffice@doj.ca.gov.

NOTE:
Members of the public who wish to speak at the forum are requested to RSVP in advance to charities.regulations@doj.ca.gov with the following information: name, title, affiliation, e-mail address, and whether you require accommodations, such as a sign language interpreter or translator.

RSVPs to speak at the virtual forum may also be submitted by mail to: The California Department of Justice, ATTN: Charitable Trusts Section, 455 Golden Gate Ave., Suite 11000, San Francisco, CA 94102-7004. If you wish to submit written comments on the regulatory topics, please provide your comments to the same email or mailing address noted above no later than December 1, 2021. Please note that any information provided is subject to the California Public Records Act.

The unofficial holiday shopping season begins on
Friday, although many retailers have been offering “Black Friday” deals for some time
already. If you’re looking forward to more Black Friday, Small Business Saturday, and Cyber
Monday deals, Maryland Attorney General Brian E. Frosh is offering these tips to help you avoid
scams, fraudulent products, and exposure to computer or smart device malware, especially if
you’re planning to shop online.
Be sure the website on which you’re entering payment information is secure. You should
never send personal information or payments through a website if the address does not begin
with “https”—the “s” at the end means that your confidential information is secure.
Be wary about clicking on ads found in emails, on a third-party website, or on social
media. Scammers frequently lure consumers through social media or emails to fake websites,
which are set up to steal personal and/or financial information, or could release malware into
your computer.
Avoid paying online retailers with gift cards, wired funds, or by sending cash. If possible,
use a credit card to make your online purchases. If you have a dispute with the retailer, the credit
card company may help you resolve it.
Research the retailer. Check online reviews to see if the retailer has a good reputation and
satisfied customers. Is there an easy way to contact customer service if you have any
problems? If not, you may want to consider another retailer.
Purchase gift cards only from reputable sources. Cards sold by individuals or at auction sites
often turn out to be stolen or counterfeit. Buying gift cards directly from the business is always a
safe option. Pop-up ads, text messages, emails, or social media posts offering free gift cards
could be scams attempting to steal your personal information, release malware, or otherwise get
you to disclose your financial information.
If you’re shopping in-person this year, there are other ways to protect yourself and make smart
shopping choices.
Check the retailer’s refund policy. A retailer is allowed to set its policy for returns or
exchanges, as long as it posts the policy or prints it on the receipt. The refund rule says that if a
store imposes limitations on refunds or returns, the merchant must disclose its policy in writing
so consumers are aware of the policy before making their purchases. This rule does not apply to
foods and perishable goods or merchandise that was custom-made for the buyer or customaltered.
Buying an “experience” gift? Read any contracts carefully. If you are purchasing a service
that requires a contract for a gift, find out if you are able to cancel the contract if it’s not used,
and what penalties, if any, you will incur for canceling. Be aware that some contracts will
automatically renew at the end of the initial period, unless you tell the company within a certain
period of time that you don’t wish to renew.
Should you avoid “going out of business” sales? Not necessarily, but you may be
unknowingly purchasing lower quality merchandise and it may not actually be the bargain you
think it is. It pays to comparison shop in this case, because the item you’re considering may
actually be available at a lower price somewhere else. And if the sales are final, which they
often are during going out of business sales, you will not be able to return or exchange it.
Remember, if something you purchase doesn’t work, you can return it. Even if a store posts
a “no refunds, no exchanges” policy, in Maryland your purchase is covered by an implied
warranty—a guarantee that the item works when you buy it. If you purchase a defective item,
contact the seller first. If they refuse to refund or replace your merchandise, contact the
Consumer Protection Division.
Many consumers also make generous donations to charities during the holiday season. This is
also a prime time for crooks to take advantage of that generosity. Before donating, check to see
if the charity in which you are interested is registered with the Maryland Secretary of State’s
Office. Several websites (such as GuideStar and Charity Navigator) provide information on an
organization’s financials, mission statements, and more. This may help you decide how to
allocate your giving. Bogus charities frequently use names and logos that resemble well-known,
legitimate organizations. These charities often surface during national emergencies, such as the
current COVID-19 pandemic. Read more about charitable donations in our “Keeping Your Eyes
Open When Donating to Charities” Consumer’s Edge.
For additional information about safe online shopping, read our “Smart Shopping from Home”
Consumer’s Edge. The Maryland Attorney General’s Office offers free publications, including
the Consumer’s Edge, to educate consumers. A full list of publications can be found at
https://www.marylandattorneygeneral.gov/Pages/CPD/TipsPublications/edunit.aspx. Consumers are encouraged to download, reproduce, and share these
publications.

In time for Giving Tuesday and the holiday season, New York Attorney General Letitia James today released her annual “Pennies for Charity: Fundraising by Professional Fundraisers” report, which found that charities that retained professional fundraisers received about two-thirds of every dollar donated in 2020. Professional fundraisers retained the remainder — earning more than $380 million. Analyzing 718 campaigns conducted by professional fundraisers in 2020, the report concludes that charities earned 73 percent of donations from those campaigns, a small increase from the previous year and in line with the last four years’ results.

“As New Yorkers get ready to give to their favorite charities tomorrow on Giving Tuesday, they deserve to know where their money is going,” said Attorney General James. “My duty is to protect New Yorkers’ wallets and ensure that what they donate reaches the charity of their choice. My office will continue to crack down on misleading fundraising practices, so New Yorkers don’t have to worry the next time they give generously to a cause they support. With the holiday season upon us, I encourage all New Yorkers to use our tips as a guide to make informed contributions and ensure that their money is going to a trustworthy source.”

New York is home to a large and diverse number of charitable organizations. As did all sectors of our society, charities faced many challenges during the coronavirus disease 2019 (COVID-19) pandemic. However, despite a significant decrease in in-person fundraising and pandemic-related closures and postponements, charitable giving in response to fundraising campaigns in New York jumped to over $1.4 billion in 2020 — an increase of more than $179 million from 2019 pre-pandemic campaign revenues. Other report findings include:

• In 339 campaigns, or 47 percent of campaigns, charities received less than 50 percent of funds raised, with professional fundraisers retaining the rest.
• In 150 campaigns, or 21 percent of the campaigns, fundraising expenses exceeded revenue, costing charities more than $10 million.

This year’s “Pennies for Charity” aggregates information from reports filed with the Office of the Attorney General’s (OAG) Charities Bureau by professional fundraisers for campaigns conducted on behalf of charities in 2020. Professional fundraisers must register with the OAG and their financial reports must break down the revenue raised, as well as the expenses generated by the campaign. The report and the searchable Pennies for Charity database containing data from those reports is posted on the Charities Bureau website.  

This year’s report lays out tips for donors to follow before donating over the phone, through the mail, or online to ensure that their contributions reach the causes they intend to support. Important tips to keep in mind include:

• If you’re contacted by a telemarketer, ask questions to make an informed decision: New York law requires telemarketers soliciting for charities to make certain disclosures to potential donors and prohibits them from making false, misleading, or deceptive statements when soliciting contributions. Telemarketers are required to tell potential donors their names, which professional fundraiser employs them, and if the telemarketer is getting paid. Donors may also ask what percentage of their donation will be paid to the fundraiser for fees and expenses.
• If you receive a direct mail charitable appeal, verify the soliciting organization: Does the organization have a name that sounds like a well-known charity? Doublecheck — is it the one you think it is? Does the mailing claim to follow up on a pledge that you do not remember making? Does it clearly describe the programs that the charity plans to fund with your donation?
• If you’re donating online, do your research first: Donating online or via an app is convenient for donors and can be cost effective for a charity. But before hitting “Send,” donors should check whether a campaign is legitimate. Below are steps to take before donating online:
  • Some online platforms that host groups and individuals soliciting for causes do not obtain permission from charities, or vet those charities who use their service. Donors should only give to campaigns conducted by people whom they know. Donors also should check what fees they will be charged and make sure that the charity has given its permission for the use of its name or logo. The site or the charity should confirm that the charity has approved the campaign.
  • When donating online, make sure the website is secure: The web address should start with “https.” Unless the charity uses a separate payment site, the web address should match that of the organization that will receive the donation.
  • Be wary of email solicitations that ask you to click a link or open attachments. These could be phishing scams that try to trick you into giving out your credit card number, Social Security number, or other confidential information.

New York Attorney General Letitia James announced the guilty pleas of nonprofit Millennium Care, Inc. and its executive director Ethel Denise Perry for tax evasion and theft of millions of dollars. Perry evaded taxes for years and stole more than $2 million to support her luxury lifestyle. The money stolen from Millennium Care was meant for the operation of a homeless shelter located at 980 Prospect Avenue in the Bronx.

“Stealing money that is earmarked for people experiencing homelessness is as immoral as it is illegal,” said Attorney General James. “This individual broke the law by failing to pay taxes while taking money from a homeless shelter in order provide a luxurious lifestyle for herself and her family members. Such actions will never be tolerated in New York, and I will continue to do everything within my power to hold those who take advantage of vulnerable communities accountable.”

Millennium Care operated a homeless shelter out of a 100-room hotel owned by Perry in the Bronx. Millennium Care received more than $10 million in funding from the New York City Department of Homeless Services to provide short-term housing services to homeless individuals. Between 2013 and 2016, Perry used Millennium Care as her own personal piggy bank and illegally took more than $2 million from Millennium Care for luxury shopping sprees at retailers such as Tiffany & Co. and Bergdorf Goodman, and to pay for her cars, gym membership, and other personal expenses. Perry also used the nonprofit to hire her brother, William Perry, and nephew, Jose Colon, and paid them far in excess of their reported salaries.

Perry, knowingly and with intent to evade her tax obligations, grossly underreported her income in 2013, then failed to file taxes from 2014 through 2019. In 2018, Perry filed late returns for 2015 and 2016, but underreported her income for those years by hundreds of thousands of dollars.

In New York County Supreme Court on Friday, Perry pleaded guilty to Criminal Tax Fraud in the Second Degree, a class C felony, and Millennium Care, Inc. pleaded guilty to Grand Larceny in the First Degree, a class B felony. Perry’s felony plea agreement bars her from nonprofit service, and requires her to pay the $1,138,208 that she owes in New York City and state taxes, penalties, and interest during a five-year probation sentence. Millennium Care, Inc. will pay a fine of $2,394,169 and will be dissolved for its participation in numerous regulatory violations and crimes, including failure to make required filings with the Office of the Attorney General’s Charities Bureau and the New York City Mayor’s Office of Contract Services. After the plea was entered Friday afternoon, the Court imposed the promised sentence.

The Attorney General’s Office thanks the New York State Department of Tax and Finance for their assistance on this case.

“This is an appalling case of greed and callous disregard for those desperate for help, one that unfairly tarnishes all the charitable organizations throughout New York who do so much good,” said Acting Commissioner of Taxation and Finance Amanda Hiller. “By flouting her tax obligations, the perpetrator also deprived communities of critical funding for other essential public services. We will continue to work with all our partners in law enforcement to help ensure that justice prevails.”