Tag: California

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Attorney General Bonta Conditionally Approves Sale of Four Retirement Communities to Pacifica Companies LLC

California Attorney General Rob Bonta today conditionally approved the sale of four continuing care retirement communities (CCRCs) located in Northern and Southern California. The CCRCs in Auburn, Long Beach, Placerville, and Sacramento are currently owned by Retirement Housing Foundation (RHF), a nonprofit public benefit corporation. The conditional approval will allow them to come under the ownership of Pacifica Companies LLC (Pacifica). Under California law, any transaction involving the sale or transfer of control of a healthcare facility owned by a nonprofit corporation must secure the approval of the Attorney General. The conditions of Attorney General Bonta’s approval preserve access to high-quality care and services for the residents of these communities.
 
“When reviewing healthcare transactions, the safety of all Californians remains our top priority,” said Attorney General Bonta. “Thanks to the strong conditions we imposed today, hundreds of residents of these four communities can safely continue living and receiving care in the place they call home. At the California Department of Justice, we remain committed to placing vulnerable communities at the forefront of our work and ensuring continuous, uninterrupted quality care for residents across the state.”

The four CCRCs are the Auburn Ravine Terrace facility, which is located in Auburn and includes a 59 licensed-bed skilled nursing facility (SNF); the Bixby Knolls Towers facility, which is located in Long Beach and includes a 99 licensed-bed SNF; the Gold Country Retirement Center facility, which is located in Placerville and includes a 68 licensed-bed SNF; and Pioneer House, which is located in Sacramento and includes a 49 licensed-bed SNF. 
 
The expert report identified safety issues at other Pacifica facilities. Between 2017 and 2022, Pacifica’s rate of citations was significantly higher than the average rate for all RCFEs in California. 
 
Therefore, as part of his conditional approval, Attorney General Bonta has imposed specific conditions for the proposed $48.5 million sale, which will require Pacifica to, among other things:

  • Appoint a monitor to ensure resident safety;
  • Report semi-annually on safety;
  • Preserve access to skilled nursing facility services for the community;
  • Consult with a Community Advisory Board at each facility on a quarterly basis;
  • Pay off debt, including existing bond debt and existing lines of credit; and
  • Honor residents’ contracts.

The California Department of Justice’s Healthcare Rights and Access Section (HRA) works proactively to increase and protect the affordability, accessibility, and quality of healthcare in California. HRA’s attorneys monitor and contribute to various areas of the Attorney General’s healthcare work, including nonprofit healthcare transactions; consumer rights; anticompetitive consolidation in the healthcare market; anticompetitive drug pricing; privacy issues; civil rights, such as reproductive rights and LGBTQ healthcare-related rights; and public health work on tobacco, e-cigarettes, and other products. 

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In Aftermath of Recent Mass Shootings, Attorney General Bonta Urges Vigilance Against Fraudulent Crowdfunding and Reminds Californians of Available Support Services

As people in California and across the country mourn the recent horrific mass shootings in the state, California Attorney General Rob Bonta today highlighted support services and urged vigilance against fraudulent crowdfunding. Across California, there are a variety of state, local, and community entities that may be able to provide assistance and support — including immediate housing, financial, funeral, and mental health resources — to crime victims, survivors, and their families. However, in the aftermath of tragedy, there are also those who seek to take advantage of communities and people’s desire to help. Well-intentioned or otherwise, those operating crowdfunding pages often formed overnight in response to crises may lack the experience, contacts, and staff needed to fulfill their commitments. Before donating online, Attorney General Bonta urges Californians to do their research.

“Our nation has once again been forced to confront more senseless gun violence. From Monterey Park to Half Moon Bay, our entire state is reeling,” said Attorney General Bonta. “While we have much work ahead to tackle America’s disease, people are also coming together to support those who are hurting and who have lost loved ones. I encourage all Californians to extend a helping hand wherever possible and to take advantage of the resources available across the state. If you plan on giving, please be wary of scammers and do your research before you donate. My heart goes out to all who are in pain in this moment and, at the California Department of Justice, we will continue to do our part to support local response efforts.”

Crowdfunding Donation Tips:

  • Research the Organizer: Learn all you can about the organizer before making a contribution. Use Google and LinkedIn to look up the organizer. Does the organizer have expertise in the area the campaign concerns? Check out their Facebook page. Does it look fake? Are the friends real? Are there real-time comments? Be suspicious of pages that were created right before the campaign started.
  • Research the Crowdfunding Platforms: There are many different crowdfunding platforms and they all have different rules. If you want a refund, you may have to get it from the organizer. Some platforms provide refunds only in certain situations, i.e., when the organizer makes false statements or is charged with a crime.
  • Do a Reverse Image Search: Fake campaigns often copy and paste other people’s stories or photos. Doing a reverse image search of the photos used in the campaign, as well as those used on the organizer’s social media pages, can show you if the photos are stolen. Be careful if the campaign is posted on multiple sites. Scammers will do this to reach more people.
  • Contact the Organizer and Ask Questions: Each crowdfunding site allows you to ask the organizer questions through the comments section. If an organizer is answering questions regularly, it is more likely that they are not trying to scam you.
  • Be Suspicious: Beware of campaigns that make you feel sorry for someone, but do not give you any details of how your money will be used. Be extra careful after a major disaster or tragedy because scammers will often try to take advantage of your desire to help victims. Beware of campaigns that seem too good to be true. They probably are.
  • Understand the Purpose of Crowdfunding: Remember that there is no guarantee that the crowdfunded campaign will be successful. When donating to a worthy cause, contributions are probably not tax deductible unless they are made to a nonprofit.
  • Learn More: Learn more about online crowdfunding and how to file a complaint through the California Department of Justice here. 
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Attorney General Bonta Releases Proposed Regulations Implementing New Online Charitable Fundraising Law

California Attorney General Rob Bonta today released a package of proposed regulations implementing Assembly Bill 488 (AB 488), a new law governing charitable fundraising on internet platforms. In recent years, charitable fundraising on internet platforms has grown exponentially, altering the landscape of charitable giving. The proposed regulations will allow the Attorney General to properly supervise charitable fundraising occurring on internet platforms and protect donors and charities from fraud and deceptive or unfair solicitations.

“When Californians open their hearts and their wallets, they deserve to have confidence that their donations are going toward their intended purposes,” said Attorney General Bonta. “The reality is: online solicitations are everywhere and charitable donations increasingly flow through crowdfunding sites and other third-party online platforms. AB 488 gives my office the tools we need to match today’s virtual market and safeguard charitable donations made through online platforms.”

AB 488, sponsored by Attorney General Bonta and authored by Assemblymember Jacqui Irwin, expands the Attorney General’s supervision of charities, charitable trustees, and fundraisers to include charitable fundraising platforms and platform charities. Charitable fundraising platforms include charitable crowdfunding websites, e-commerce companies that solicit donations for charities or engage in online charitable sales promotions, and companies that provide customizable versions of their fundraising platforms to charities. Platform charities are retained by charitable fundraising platforms, typically for the purpose of soliciting and receiving donations for other charitable organizations.

Under this new law, the Attorney General is required to adopt regulations necessary for supervising charitable fundraising on internet platforms. Today’s proposed regulations implement AB 488’s requirements that charitable fundraising platforms and platform charities:  

  • Register and report to the Attorney General’s Registry of Charitable Trusts, with filings 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.

A copy of the proposed regulations can be found here. A virtual hearing on the proposed regulations will occur on Wednesday, July 13, 2022 at 9:00 am Pacific Time. A link to the public hearing can be found here. Media are encouraged to RSVP at agpressoffice@doj.ca.gov.

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Attorney General Bonta Announces Stipulated Judgment Against ZeroDivide for Misspending Donations

California Attorney General Rob Bonta today announced a stipulated judgment against ZeroDivide and its directors and officers to resolve allegations that the nonprofit violated California’s charitable trust laws. ZeroDivide allegedly misspent approximately $606,000 in restricted donations meant to fund two of its charitable programs, instead using these donations to cover salaries and benefits for employees who did not work on those programs, and to fund other programs. Today’s settlement requires ZeroDivide to be dissolved and prohibits two of its officers from leading charitable organizations in California, or holding or soliciting charitable donations from Californians for three years. ZeroDivide and its directors and officers must also pay over $460,000 in damages, penalties, and other fees.

“As ZeroDivide’s financial situation became increasingly precarious, its officers misappropriated money designated for specific programs to pay for unauthorized operational costs,” said Attorney General Bonta. “Today’s settlement should serve as a warning for charities who consider misspending donations. Donor intent must be honored. My office is watching, and we will hold you accountable.”

ZeroDivide is a San Francisco-based nonprofit focused on bringing technology to low-income communities that ceased operations in 2016 due to its financial insolvency. ZeroDivide operated two primary programs: Digital Bridge and the Renaissance Journalism Center. Through the Digital Bridge program, ZeroDivide provided technical assistance and “capacity building” to other nonprofits and public entities, such as libraries, as they adopted new technologies and upgraded their technology infrastructure. ZeroDivide’s Renaissance Journalism Center advanced equity in the reporting of news stories by journalists. 

In court filings, Attorney General Bonta alleges that between 2014 and 2016, the California Endowment, California Wellness Foundation, Ford Foundation, Vesper Society, Whitman Institute, and Wyncote Foundation provided restricted donations to fund these two programs. At the same time, ZeroDivide’s unrestricted revenue was shrinking, and it began to struggle to pay operational costs. Unbeknownst to donors, ZeroDivide began to dip into restricted funds to pay for a range of expenses, such as the salaries and benefits for staff and other programs that donors expressly did not want to fund. ZeroDivide’s board of directors was aware of this misconduct and failed to stop it from happening.  

In total, ZeroDivide allegedly misspent approximately $606,000 in restricted donations. ZeroDivide also maintained inaccurate financial statements related to the receipt and spending of program funds; failed to file required annual reports with the Attorney General’s Registry of Charitable Trusts, and failed to maintain adequate financial records, among other violations.

As part of the stipulated judgment, ZeroDivide and its directors and officers will be required to pay $326,008 in damages and $138,525 in penalties, late filing fees, and attorney’s fees. The nonprofit’s directors must also dissolve ZeroDivide and distribute the damages amount and any remaining assets to Community Initiatives, the fiscal sponsor for the Renaissance Journalism Center. Finally, two of ZeroDivide’s officers will be permanently enjoined from any future violations of California’s charitable trust laws and will be prohibited, for three years, from leading a charitable organization in California, working in a paid or volunteer capacity for a for-profit entity in the business of charitable fundraising in California, and from soliciting, holding, or managing funds or assets for a charitable purpose in California or from Californians.

In California, the Attorney General has primary responsibility for supervising charities, charitable trustees, professional fundraisers, and others who solicit or hold charitable donations. The California Department of Justice investigates the loss and misuse of charitable assets, fraudulent and misleading solicitation practices, improper reporting practices and other breaches of fiduciary duty. Charities are required to register and file annual financial reports with the Attorney General’s Registry of Charitable Trusts.

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Following the Invasion of Ukraine, Attorney General Bonta Issues Consumer Alert Warning Californians Against Fraudulent Charitable Solicitations

California Attorney General Bonta today warned Californians of fraudulent charitable solicitations that may claim to help the victims of Ukraine’s recent invasion. Well-intentioned or otherwise, the charities formed overnight as a response to this crisis may lack the experience, contacts, and staff needed to respond to a disaster. Fraudsters are always seeking to capitalize on people’s desire to help. Before aiding the victims of this crisis, Attorney General Bonta urges Californians to take their time to research before giving.

“The invasion of Ukraine is heartbreaking and unacceptable. I know that Californians, many with families and loved ones in the country, stand in solidarity with Ukraine and will be looking for any way to help its people,” said Attorney General Bonta. “However, before Californians do this, I urge them to take the necessary steps to research these charities so their contributions can go to legitimate causes. As Californians do their part to give to those in need in Ukraine, we will do our part to protect the integrity of those donations from deceptive solicitations. If you believe that a charity or fundraiser has acted in bad faith, please report it immediately at oag.ca.gov/charities/complaints.”

Donation Tips

  • Check the Registration Status: Charities operating in California and telemarketers soliciting donations in California are required to register with the Attorney General’s Registry of Charitable Trusts. They are also required to file annual financial reports, which are made available to the public. Prior to making a donation, make sure to confirm that the charity is registered and up-to-date with its financial reporting by searching the Attorney General’s Registry of Charitable Trusts’ database, located here.
  • Give to Organizations You Trust: Do your research before giving. Review the charity’s purpose and find out how the charity spends its donations. How much is spent directly on the charitable cause? How much goes to overhead and employee compensation? Research charities in your community and support those charities that make a positive impact. If you choose to donate to a charity you are unfamiliar with, contact the charity and ask for information in writing about its programs and finances. You should also confirm the charity’s name, address, and its nonprofit status. 
  • Be Wary of Social Network Fundraising: If you are planning to donate through a social network solicitation, first do some research. Find out what percentage is going to the charity, whether you will be charged a fee, or if a percentage of your donation will be paid to the platform website. 
  • Don’t Be Pressured by Telemarketers – Ask Questions Before Donating: If you receive a call from a telemarketer, ask for the name of the fundraising organization, whether it is registered with the Attorney General’s Office, the name of the charity benefitting from the solicitation, how much of your donation will go to charity and how much to the telemarketer, and the direct telephone number of the charity. If the telemarketer tells you the donation is for your local animal shelter, hospital, school, police, firefighter, or other public safety agency, check directly with the benefitting organization to confirm that it authorized the solicitation and will actually benefit from your donation. Don’t fall for pressure tactics or threats. Remember that you have the right to reject the donation appeal and if you feel pressured or threatened, just hang up.
  • Watch Out for Similar-Sounding Names, Web Addresses, and Other Deceptive Tactics: Fraudulent organizations may use names that closely resemble those of well-established charitable organizations in order to mislead donors. Look out for fraudulent websites that have a slightly different web address (URL) than that of a legitimate charitable organization. Similar-looking URLs are sometimes purchased by fraudsters to lure in would-be donors. These sites may ask you for personal information or install harmful material onto your device. Be skeptical if someone thanks you for a pledge you never made, and always check your records. 
  • Understand the Difference Between “Tax-Exempt” and “Tax-Deductible”: Being a nonprofit does not mean the organization is exempt from taxation, or that your donation is tax-deductible. Generally, a tax-exempt organization is exempt from paying tax on its income and gifts, but may or may not be able to offer a charitable tax deduction to donors for their contributions. Just because an organization has a “Tax ID Number” or provides donors with a receipt that says “keep this receipt for your records” does not mean that the organization is a charity, tax-exempt, or that your donation is tax-deductible. A few tax-exempt organizations – most notably those given 501(c)(3) tax-exempt status by the Internal Revenue Service (IRS) – are able to offer charitable tax deductions for your donations. If you are not sure whether your donation is tax-deductible, verify the charity’s tax-exempt status by using the tools and information located on the IRS website.
  • Consider the Costs of Gifts and Merchandise: Gifts that you receive from a charity in exchange for your donation cost money and generally, these expenses are paid from donated funds. The value of the goods and services that you receive for your donation is not tax-deductible. Some charities may sell merchandise online and claim that “100% of the proceeds” will benefit its charitable purpose. However, this does not necessarily mean that 100% of the sales price of the merchandise will go to charity, and the cost of the merchandise itself can greatly reduce the value of your donation.
  • Protect Your Identity: Never give your Social Security number or other personal information in response to a charitable solicitation. Never give out credit card information to an organization unfamiliar to you. Some organizations sell or rent their donor lists to other organizations, including organizations that are not charities. Review the charity’s privacy policy to find out if your information will be shared with outside companies.