Charity Fraud Conviction Reveals Vulnerabilities and Use of PACs in Scams
The NYTimes has a recent story Fund Raiser Who Pocketed Money Meant for Sick Kids and Vets Gets 10 Years in Prison that gives nice insight into the vulnerabilities of our charity regulation system as well as where some of the scamming has moved to: PACS. Well worth a read.
From the story:
“Even when authorities came after Mr. Zeitlin himself, the largely state-by-state nature of charity regulation meant that the pain was minimal. In 2010, Ohio’s attorney general said that his company had actually broken the cardinal rule against lying, and falsely told donors that their gifts would benefit a specific sheriff’s department. But Mr. Zeitlin resolved it by paying a $10,000 settlement.
In 2016, he faced a new obstacle. The F.T.C. issued a staff opinion saying that soundboards could no longer be used to cold-call charity donors. Mr. Zeitlin sued the commission, seeking to reverse that decision, but lost.
He then shifted into an area where these calls were still legal: political fund-raising.
By 2018, his companies were working for at least 16 political action committees, making $18 million in revenue, according to campaign-finance records”