May 16, 2007, Introduced by Senators GEORGE, KUIPERS, BARCIA, BIRKHOLZ, OLSHOVE, PAPPAGEORGE, JANSEN, KAHN, CROPSEY, CASSIS and RICHARDVILLE and referred to the Committee on Economic Development and Regulatory Reform.
A bill to amend 1975 PA 169, entitled
"Charitable organizations and solicitations act,"
by amending the title and sections 2, 3, 4, 6, 7, 8, 9, 10, 11, 13,
16, 18, 20, 21, and 23 (MCL 400.272, 400.273, 400.274, 400.276,
400.277, 400.278, 400.279, 400.280, 400.281, 400.283, 400.286,
400.288, 400.290, 400.291, and 400.293), section 13 as amended by
1992 PA 299, and by adding sections 3a, 3b, 5a, 19, 19a, 22a, 23a,
and 23b; and to repeal acts and parts of acts.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
TITLE
An
act to regulate charitable organizations, and professional
fund-raisers and other persons soliciting or collecting
contributions
for charitable purposes on
behalf of charitable
organizations, and certain other persons involved in the
solicitation of contributions to charitable organizations; to
require
registration , and disclosure of information and licensing
by charitable organizations and professional fund-raisers before
solicitation of contributions; to provide for reporting of
financial
and other information by those licensed or registered and
those claiming exemption from registration; to prescribe standards
of conduct and administration, and to prohibit certain actions, in
connection with charitable solicitations; to provide for
enforcement,
investigation, and promulgation of rules by the powers
and duties of the attorney general and county prosecuting
attorneys; to preempt local regulation; to provide remedies and
penalties
for violations; and to repeal certain acts and parts of
acts.
Sec. 2. As used in this act:
(a)
"Charitable organization" means a benevolent, educational,
philanthropic,
humane, patriotic, or eleemosynary organization of
persons
which solicits or obtains contributions solicited from the
public
for charitable purposes. A chapter, branch, area office, or
similar
affiliate or person soliciting contributions within the
state
for a charitable organization which has its principal place
of
business outside the state is a charitable organization. This
definition
does not include duly constituted religious
organizations
or a group affiliated with and forming an integral
part
of a religious organization no part of the net income of which
inures
to the direct benefit of any individual if it has received a
declaration
of current tax exempt status from the United States.
The
affiliated group shall not be required to obtain a declaration
if
the parent or principal organization has obtained tax exempt
status.
Charitable organization does not include a candidate or
committee
as defined in section 901 of Act No. 116 of the Public
Acts
of 1954, being section 168.901 of the Michigan Compiled Laws,
or
a political party qualified to be on the general election ballot
pursuant
to section 560a of Act No. 116 of the Public Acts of 1954,
as
added, being section 168.560a of the Michigan Compiled Laws. tax
exempt organization under section 501(c)(3) of the internal revenue
code, 26 USC 501, or a person whose purposes, structure, or
activities are exclusively those that are described in section
501(c)(3) of the internal revenue code, 26 USC 501. The term does
not include any of the following:
(i) A federal, state, or local unit of government or a
subdivision, agency, or instrumentality of federal, state, or local
government.
(ii) A religious organization.
(b) "Charitable purpose" means a purpose described in section
501(c)(3) of the internal revenue code, 26 USC 501.
(c) "Charitable sales promotion" means an advertising or sales
campaign representing that proceeds from the sale or use of the
goods or services offered will benefit, in whole or in part, a
charitable organization or charitable purpose, or that the seller,
commercial coventurer, or vendor will make a payment to a
charitable organization or for a charitable purpose.
(d) "Commercial coventurer" means a person other than a
charitable organization or professional fund-raiser who conducts
charitable sales promotions or a person who enters into a licensing
arrangement in which a charitable organization allows the person to
use the charitable organization's name for a fee.
(e) (b)
"Contribution" means the promise, grant, or payment of
money
or property of any kind or value, including promises the
promise to pay. , except payments by members of an organization
for
membership
fees, dues, fines, or assessments, or for services
rendered
to individual members, if membership in the organization
confers
a bona fide right, privilege, professional standing, honor,
or
other direct benefit, other than the right to vote, elect
officers,
or hold offices, and except money or property received
from
a governmental authority or foundation restricted as to use.
Contribution includes that portion of membership fees, dues, or
assessments that exceed the monetary value of membership benefits
available to a dues payer whether or not the membership benefits
are used, and membership fees, dues, or assessments that are paid
primarily to support the charitable organization's activities.
Contribution does not include any of the following:
(i) A grant or contract from any governmental agency.
(ii) Any portion of membership dues, fees, or assessments paid
to a labor organization or bargaining representative. As used in
this subparagraph:
(A) "Bargaining representative" means that term as defined in
section 1 of 1947 PA 336, MCL 423.201.
(B) "Labor organization" means that term as defined in section
2 of 1939 PA 176, MCL 423.2, or section 2 of the national labor
relations act, 29 USC 152.
(f) "Misrepresentation" includes an affirmative
misrepresentation; a false statement; or an omission of or failure
to disclose a material fact that is not obvious to the person to
whom a statement or representation is made, if the omission or
failure to disclose tends to mislead that person.
(g) (c) "Person" means an individual, an
organization, a
group, an association, partnership, corporation, limited liability
company, trust, or any combination of them other legal entity.
(h) "Private foundation" means that term as defined in section
509(a) of the internal revenue code, 26 USC 509.
(i) "Professional fund-raiser" means a person, including a
subcontractor, who for compensation or other consideration
conducts, manages, or carries out a plan, drive, or campaign to
solicit contributions for or on behalf of a charitable organization
or religious organization; a person, including a subcontractor, who
engages in the business of or holds himself or herself out as
independently engaged in the business of soliciting contributions
for charitable purposes; or a bona fide officer or employee of a
charitable organization if his or her salary or other compensation
is based or computed on the amount of money he or she raises or is
expected to raise. A person whose service to a charitable
organization or religious organization is limited to providing
training, advice, research, preparation of grant proposals, or
design, writing, or production of soliciting materials is not a
professional fund-raiser if all of the following are met:
(i) Any proposals, documents, or materials written or produced
by or on behalf of the professional fund-raiser for the charitable
organization or religious organization are subject to review and
acceptance or rejection by the charitable organization or religious
organization.
(ii) Any proposals for funding submitted to a grantor or donor
are submitted to the grantor or donor by the charitable
organization or religious organization.
(iii) The person does not directly solicit any grantors or
donors for the charitable organization or religious organization.
(iv) The person's compensation is not directly or indirectly
based or computed on the amount of money the charitable
organization or religious organization raises or intends to raise.
(j) "Religious organization" means any of the following:
(i) A church, integrated auxiliary of a church, or convention
or association of churches described in section 6033(a)(2)(A)(i) of
the internal revenue code, 26 USC 6033.
(ii) A religious order described in section 6033(a)(2)(A)(iii) of
the internal revenue code, 26 USC 6033, engaged solely in
exclusively religious activities.
(k) "Solicit" and "solicitation" mean the following:
(i) A direct or indirect request for a contribution based on
the representation that the contribution will or may be used for a
charitable purpose or to benefit a charitable organization, whether
or not the person making the solicitation receives a contribution.
The term includes, but is not limited to, any of the following
methods of requesting contributions:
(A) Making an oral or written request.
(B) Distributing, circulating, mailing, posting, or publishing
a handbill, written advertisement, or other communication that
directly or by implication seeks to obtain a contribution.
(C) Making an announcement to the news media, or by radio,
television, telephone, telegraph, facsimile, electronic mail, or
any other communication device, or on the internet, concerning an
appeal or campaign for a charitable organization or purpose.
(D) Selling, attempting to sell, or offering to sell an
advertisement, advertising space, a book, a coupon, a magazine, a
membership, merchandise, a subscription, a ticket, or other item in
connection with a request for a charitable organization or purpose.
(E) Utilizing receptacles such as honor boxes, vending
machines, wishing wells, or contribution boxes for contributions,
if a charitable purpose or a charitable organization's name is
used, referred to, or implied as an inducement to make a
contribution or purchase.
(ii) Knowingly receiving contributions that are solicited from
the public by a person other than a charitable organization and
transferred to that charitable organization.
(iii) Receiving money from a community chest, united fund, or
similar organization or from a combined solicitation by 2 or more
charitable organizations.
(l) (d)
"Soliciting material" means printed or similar
material,
any document or other object
used to communicate or as a
communication aid in a solicitation, including, but not limited to,
labels, posters, television scripts, radio scripts, or other text
or recordings used in soliciting funds from the public.
(m) (e)
"Solicitor" means a person an individual who solicits
on behalf of a charitable organization.
(f)
"Professional fund raiser" means a person who for
compensation
or other consideration plans, conducts, manages, or
carries
on a drive or campaign of soliciting contributions for or
on
behalf of a charitable organization, religious organization, or
any
other person; or who engages in the business of or holds
himself
out as independently engaged in the business of soliciting
contributions
for such purposes. A bona fide officer or employee of
a
charitable organization is not a professional fund raiser unless
his
salary or other compensation is computed on the basis of funds
to
be raised or actually raised.
(g)
"Professional solicitor" means a person who is employed or
retained
for compensation by a professional fund raiser to solicit
contributions
for charitable purposes.
(h)
"Prohibited transaction" is that dealing, activity,
conduct,
administration, or management of the charitable
organization
or by any of its officers, trustees, personnel, or
related
persons which may be prohibited as constituting activity
contrary
to proper administration of the charitable organization or
conduct
of a fund raising campaign or solicitation by a
professional
fund raiser or solicitor.
(n) "Vendor" means a person other than a charitable
organization or professional fund-raiser who conducts charitable
sales promotions or solicitation campaigns through vending
machines, honor boxes, novelty machines, or similar devices, that
represents that it benefits a charitable organization or a
charitable purpose through a portion of the proceeds, a fixed
dollar amount, or any other manner.
Sec.
3. (1) Before a solicitation, a Unless the charitable
organization
which is not an exempt organization and which is not
described
in from registration and
reporting under section 13,
which
a charitable organization
that solicits or intends to solicit
or receives or intends to receive contributions from persons by any
means
whatsoever, shall file with the attorney general upon forms
prescribed
by him, an application for a license. It register with
the attorney general as provided in this act.
(2) A charitable organization registering under this act shall
register in writing on forms prescribed by the attorney general and
shall include all of the following information about the charitable
organization in the registration form:
(a)
The name of the organization and the any name under which
it
intends used by that
organization to solicit contributions.
(b)
The principal address and
telephone number of the
principal office of the organization and the address of any office
in this state. If the organization does not maintain a principal
office,
the organization shall include the name, and address, and
telephone number of the person having custody of its financial
records in the registration form.
(c)
The names and addresses of the officers, directors,
trustees,
chief executive officer, and state agent.
(c) (d)
Where and when the organization was legally
established
, and the form of its organization. ,
and its tax
exempt
status.
(d) The organization's federal tax exempt status.
(e)
The A statement of the
organization's purpose for which it
is
organized and the purposes for
which contributions to be
solicited will be used.
(f)
The fiscal year date of the organization methods the
organization will use to solicit contributions.
(g)
Whether the organization is or has ever been enjoined from
soliciting
contributions The names and
addresses of all
professional fund-raisers with which the organization has
contracted.
(h)
All methods by which solicitations will be made A list of
the names and addresses of the organization's board of directors,
officers, and trustees.
(i)
Copies of contracts between charitable organizations and
professional
fund raisers relating to financial compensation or
profit
to be derived by the professional fund raisers. When the
contract
is executed after filing of application statement, a copy
shall
be filed within 10 days of the date of execution.
(j)
Other information as required by rule.
(i) Whether the organization or any officer, trustee, or
director of the organization meets any of the following:
(i) Is a party to or subject of a pending court action or
administrative proceeding concerning a solicitation in any state or
country.
(ii) As a result of a court action or administrative
proceeding, whether by agreement, order, or judgment, was ever
enjoined, fined, convicted, or subjected to any other sanction or
penalty in connection with a solicitation in any state or country.
(iii) Within the 10-year period preceding the date of the
application, was convicted in any state or country of any crime
involving dishonesty or false statement.
(iv) Within the 10-year period preceding the date of the
application, was convicted in any state or country of any felony
involving theft.
(j) Whether an officer, director, or employee of the
charitable organization owns any interest in a professional fund-
raiser, or is an agent or contractor for a professional fund-
raiser, during a period of time when the professional fund-raiser
is under contract with the charitable organization to solicit
funds.
(3) A charitable organization shall provide copies of all of
the following registration materials with a registration form
described in subsection (2):
(a) If the charitable organization is tax exempt, a copy of
its internal revenue service determination letter with its initial
registration form.
(b) Subject to subsection (5), 1 of the following:
(i) A copy of its fully and properly completed internal revenue
service form 990, 990-EZ, or 990-PF, or any successor internal
revenue form for the immediately preceding tax year. The charitable
organization must include all schedules, attachments, and exhibits
it filed with the internal revenue service, except that a
charitable organization that is not a private foundation may omit
its schedule of contributors. If a charitable organization is
filing its initial registration form and at the time of filing it
has not completed its federal tax return for the immediately
preceding tax year or it has received a filing extension from the
internal revenue service for that tax year, the charitable
organization may satisfy this subparagraph by providing a copy of
its most recently filed internal revenue service form 990, 990-EZ,
or 990-PF.
(ii) If a charitable organization does not file an internal
revenue service form 990, 990-EZ, or 990-PF, it shall prepare a pro
forma form 990, 990-EZ, or 990-PF return and provide it with the
registration form. A charitable organization shall complete a pro
forma return fully and properly pursuant to internal revenue
service instructions and shall include all required information,
attachments, schedules, and exhibits.
(c) Financial statements prepared according to generally
accepted accounting principles that have been audited by an
independent certified public accountant if the amount of
contributions received by the charitable organization during its
immediately preceding tax year reported on its federal tax return
is $500,000.00 or more. If the amount of contributions as reported
on the charitable organization's internal revenue service form 990,
990-EZ, or 990-PF is $250,000.00 or more, but less than
$500,000.00, the charitable organization shall provide financial
statements either reviewed or audited by an independent certified
public accountant. The amount of contributions received by the
organization includes direct and indirect public support as shown
on the internal revenue service form 990, 990-EZ, or 990-PF, plus
net special fund-raising events revenue. The attorney general may
waive this requirement 1 time for a charitable organization.
Effective for all tax years beginning on or after January 1, 2010
and before January 1, 2015, the dollar amounts of contributions at
which reviewed financial statements and at which audited financial
statements are required shall be increased by $25,000.00.
Additional $25,000.00 increases in the dollar amounts of
contributions shall be made every 5 tax years beginning with each
fiscal year beginning on or after January 1, 2015.
(4) The chief executive officer, chief financial officer, or
the highest ranking officer of a charitable organization, or, if
the organization is a trust, a trustee of the organization, shall
sign a registration form or a renewal of registration form
delivered to the attorney general under this section and shall
certify under penalties for perjury that the statements made in the
registration form and registration materials are true, complete,
and correct.
(5) The attorney general may waive the requirements of
subsection (3)(b) for a newly created charitable organization that
has not completed its initial accounting period or whose internal
revenue service form 990, 990-EZ, or 990-PF for its initial
accounting period has not yet been prepared.
Sec. 3a. (1) A professional fund-raiser shall not solicit or
receive donations for a charitable purpose or on behalf of a
charitable organization or religious organization before
registering with the attorney general under this section and paying
a registration fee under section 5a, or after the expiration,
suspension, revocation, or denial of its registration.
(2) A professional fund-raiser registering under this act
shall register in writing on forms prescribed by the attorney
general and shall include all of the following information about
the professional fund-raiser in the registration form:
(a) The name of the professional fund-raiser and any other
names previously or currently used by the professional fund-raiser.
(b) The address and telephone number of the principal office
of the professional fund-raiser and of each office it maintains in
this state.
(c) Where and when the professional fund-raiser was legally
established and the form of its organization.
(d) If the professional fund-raiser is a corporation, the name
and business or home address of each officer, director,
stockholder, or member.
(e) If the professional fund-raiser is a sole proprietorship,
the name and business or home address of the owner.
(f) If the professional fund-raiser is a limited liability
company, the name and business address of each member and manager.
(g) If the professional fund-raiser is a partnership, the name
and business address of each partner.
(h) The names and addresses of each business that also
provides services or products to charitable organizations and that
is related to or associated or affiliated with the professional
fund-raiser or any of the professional fund-raiser's officers,
directors, members, managers, or persons with any ownership
interest in the professional fund-raiser. The professional fund-
raiser shall also describe the services or products provided by
that business and the nature of the relationship, association, or
affiliation between that business and the professional fund-raiser.
(i) The name, address, and telephone number of each agent or
employee of the professional fund-raiser who has direct
responsibility for solicitation activity in this state.
(j) Whether the professional fund-raiser or any officer,
director, or principal of the professional fund-raiser meets any of
the following:
(i) Is a party to or subject of a pending court action or
administrative proceeding concerning a solicitation in any state or
country.
(ii) As a result of a court action or administrative
proceeding, whether by agreement, order, or judgment, was ever
enjoined, fined, convicted, or subjected to any other sanction or
penalty in connection with a solicitation in any state or country.
(iii) Within the 10-year period preceding the date of the
application, was convicted in any state or country of any crime
involving dishonesty or false statement.
(iv) Within the 10-year period preceding the date of the
application, was convicted in any state or country of any felony
involving theft.
(k) A concise description of the principal methods by which
the professional fund-raiser is or will be soliciting
contributions.
(l) The name, address, and telephone number of any charitable
organization for which the professional fund-raiser has agreed to
solicit funds or provide services as a professional fund-raiser on
any campaign in this state.
(m) Whether an officer, director, or employee of a charitable
organization owns any interest in the professional fund-raiser, or
is an agent or contractor for the professional fund-raiser, during
a period of time when the professional fund-raiser is under
contract with that charitable organization to solicit funds, and
whether that information has been fully disclosed to the board of
directors or other governing body of the charitable organization.
(n) The signature of an officer, owner, manager, or partner of
the professional fund-raiser certifying under penalties of perjury
that the statements made in the registration form and registration
materials are true, correct, and complete.
(3) A professional fund-raiser shall provide copies of all of
the following registration materials with a registration form
described in subsection (2):
(a) A complete copy of any agreement between the professional
fund-raiser and a charitable organization.
(b) A complete copy of any subcontract agreement between the
professional fund-raiser and a person that will act as a
professional fund-raiser on behalf of a charitable organization,
religious organization, or any other person soliciting for a
charitable purpose.
(4) Except as otherwise provided in subsection (5), a
professional fund-raiser that receives, has custody of, or has
access to funds solicited in this state for a charitable
organization shall include with its registration form a $25,000.00
bond that meets all of the following:
(a) The professional fund-raiser is the principal obligor.
(b) The bond runs to the benefit of the people of this state
and to any charitable organization or other person that may have a
cause of action against the professional fund-raiser as a result of
the professional fund-raiser's conduct of any activity subject to
this act.
(c) The bond is obtained and submitted in the form prescribed
by the attorney general.
(d) A company authorized to engage in insurance activity in
this state issues the bond.
(e) The term of the bond does not expire until at least 1 year
after the professional fund-raiser's registration expires.
(5) The attorney general may accept an irrevocable letter of
credit in lieu of a bond required under subsection (4) if the
irrevocable letter of credit is issued by a financial institution
that is authorized to transact business in this state and the
irrevocable letter of credit is insured by the federal deposit
insurance corporation, the federal savings and loan insurance
corporation, or the national credit union association. An
irrevocable letter of credit shall be submitted in the form
prescribed by the attorney general and shall expire not less than 1
year after the professional fund-raiser's registration expires.
(6) Within 90 days after a solicitation campaign is completed,
or on the anniversary of the commencement of a solicitation
campaign lasting more than 1 year, a professional fund-raiser that
solicited contributions in this state on behalf of a charitable
organization shall file with the attorney general a financial
report for the campaign, including gross receipts and an
itemization of all expenses incurred on behalf of the charitable
organization. The professional fund-raiser shall submit the report
on a form prescribed by the attorney general. An authorized
official of the professional fund-raiser and an authorized official
of the charitable organization shall sign the report, and each
shall certify, under oath, that the report is true to the best of
his or her knowledge.
(7) A registration under this section expires on the last day
of the twelfth full calendar month after the registration is
effective.
Sec. 3b. (1) The registration of a charitable organization
under section 3 or a professional fund-raiser under section 3a is
effective immediately when the attorney general receives its
registration form, its complete and accurate registration
materials, and its registration fee under section 5a.
(2) Within 60 days after the attorney general receives a
registration form, the registration materials, and a registration
fee under subsection (1), the attorney general shall do 1 of the
following:
(a) Notify the charitable organization or professional fund-
raiser that its registration is effective and of its registration
date under subsection (1).
(b) If the charitable organization or professional fund-raiser
made a misrepresentation or omitted required information in its
registration form or registration materials, or the charitable
organization or professional fund-raiser has violated or is
violating this act or rules promulgated under this act, notify the
charitable organization or professional fund-raiser of the
misrepresentation, omission, or violation.
(3) After notice and an opportunity to be heard, the attorney
general shall deny or revoke the registration of a charitable
organization if either of the following is met:
(a) The charitable organization has fewer than 3 directors or
trustees at the time the organization submits its registration
materials or the charitable organization is a trust with a single,
corporate trustee.
(b) The number of directors or trustees of the charitable
organization falls below 3 during the organization's registration
period and the organization fails to properly elect or appoint a
sufficient number of directors or trustees to bring the total to 3
or more within 30 days.
(4) After notice and an opportunity to be heard, the attorney
general may deny, suspend, or revoke the registration of a
charitable organization or professional fund-raiser who meets any
of the following:
(a) Has violated or is violating this act or rules promulgated
under this act.
(b) Made a misrepresentation to or omitted information
required by the attorney general under this act.
(c) Is or has been enjoined from soliciting in any state or
country in connection with actions or omissions that would violate
this act.
(d) For a charitable organization, the internal revenue
service has revoked its federal tax-exempt status.
(5) The attorney general may suspend the registration of a
charitable organization or professional fund-raiser, on an
emergency basis without a hearing, if the attorney general issues a
notice of emergency suspension containing both of the following:
(a) A description of the alleged violation of this act or a
rule promulgated under this act or other conduct that constitutes
the emergency.
(b) A statement that the charitable organization or
professional fund-raiser has an opportunity for a hearing at a
designated time, date, and place, within 48 hours after the notice
of emergency suspension is issued, or at a later time agreed to in
writing by the charitable organization or professional fund-raiser,
on whether the emergency suspension should continue pending a
hearing held under subsection (6).
(6) All of the following apply to a notice given or a hearing
held under this section:
(a) The administrative procedures act of 1969, 1969 PA 306,
MCL 24.201 to 24.328, applies to the notice and hearing.
(b) At a hearing held under subsection (3) or (4), the
charitable organization or professional fund-raiser shall have a
reasonable opportunity to rebut the attorney general's allegations
and to produce evidence to show compliance with this act or the
rules promulgated under this act.
(c) At a hearing held under subsection (5), the attorney
general has the burden of proof in establishing noncompliance with
this act or a rule promulgated under this act and establishing that
the public health, safety, or welfare requires the emergency
suspension to continue pending a hearing held under subsection (3)
or (4).
Sec.
4. (1) True A true and correct copies copy
of the
contracts
of any contract between a
charitable organization and a
professional
fund raisers fund-raiser shall be kept on file
retained in the offices of the charitable organization and the
professional
fund raiser fund-raiser during the term of employment
the
contract and for 6 years subsequent
to the date after the
solicitation
of contributions provided for therein in the contract
actually terminates.
(2)
Copies of all soliciting materials shall be suppliedupon
request
of the attorney general.
(2) A charitable organization, professional fund-raiser,
vendor, or commercial coventurer shall provide copies of any
contracts and any soliciting materials to the attorney general upon
request.
(3) A charitable organization shall retain in its records
proof of the registration of any professional fund-raiser with
which it has contracted to perform services as a professional fund-
raiser for any solicitation campaign conducted in this state for a
period of 3 years after the campaign has ended.
Sec. 5a. (1) A charitable organization shall pay a
registration fee to the attorney general with its application for
registration or renewal registration in 1 of the following amounts:
(a) If the charitable organization received contributions of
less than $100,000.00 in the immediately preceding tax year,
$35.00.
(b) If the charitable organization received contributions of
$100,000.00 or more and less than $500,000.00 in the immediately
preceding tax year, $75.00.
(c) If the charitable organization received contributions of
$500,000.00 or more and less than $1,000,000.00 in the immediately
preceding tax year, $125.00.
(d) If the charitable organization received contributions of
$1,000,000.00 or more and less than $5,000,000.00 in the
immediately preceding tax year, $200.00.
(e) If the charitable organization received contributions of
$5,000,000.00 or more in the immediately preceding tax year,
$250.00.
(2) A professional fund-raiser shall pay a registration fee to
the attorney general with its application for registration or
renewal registration in the amount of $300.00.
Sec. 6. (1) A charitable organization shall notify the
attorney general in writing within 30 days of any change in the
information
required to be furnished under section 3 3(2)(a), (b),
(d),
(e), (f), (g), (i), or (j) or section 3(3).
A report shall be
filed
and signed by the president or other authorized officer and
the
chief fiscal officer of the organization.
(2) A professional fund-raiser shall notify the attorney
general in writing within 30 days of any change in the information
the professional fund-raiser is required to provide under section
3a(2).
Sec.
7. (1) The license of a charitable organization shall
expire
1 year after the date of issuance. A charitable organization
desiring
renewal of a license shall file with the attorney general
a
renewal application and supporting information on or before 30
days
prior to the expiration date. A
registered charitable
organization shall report on its most recent fiscal year and renew
its registration within 6 months after the close of that fiscal
year. A registered charitable organization shall renew its
registration in writing on forms prescribed by the attorney general
under section 3(2) and shall include with the renewal registration
form the registration materials required to register under section
3(3) and the registration fee required under section 5a.
(2) A charitable organization's registration shall expire if
the charitable organization's renewal registration form under
section 3(2), registration materials required under section 3(3),
and registration fee under section 5a are not received within 18
months after the end of the fiscal year reported on the
organization's most recently filed registration form unless the
attorney general has extended the registration under subsection
(4). If the attorney general has suspended the requirement that a
charitable organization provide a copy of its internal revenue
service form 990 under section 3(5), the organization's
registration shall expire 6 months after the end of its initial
accounting period unless the attorney general extends the
registration under subsection (4).
(3) A charitable organization previously registered under this
act that is no longer subject to the registration requirements of
this act shall file a financial report within 6 months of the close
of the most recently completed fiscal year in which the
organization solicited in this state unless the attorney general
has extended the period of time for filing the report under
subsection (4). The report shall include the organization's
internal revenue service form or financial statement that would be
required to renew the organization's registration and any reports
on solicitation campaigns conducted by the charitable organization
through a professional fund-raiser required under section 3a(6).
(4) The attorney general may extend a charitable
organization's registration, or the organization's time for filing
the report required under subsection (3), for 3 months. If a
charitable organization receives an extension of time to file the
charitable organization's internal revenue service form 990, 990-
EZ, or 990-PF, the attorney general shall extend the charitable
organization's registration, or extend its time for filing the
report required under subsection (3), for a similar period of time.
Sec.
8. (1) Documents required to be filed with the attorney
general
shall be open to public inspection. Persons subject to this
act
shall maintain accurate and detailed books and records at the
office
of the resident agent or the principal office which shall be
open
to inspection at all reasonable times by the attorney general
or
his authorized representative. A
registration form or
registration materials submitted with a registration form, an
annual report, or any other information a person is required to
provide to or file with the attorney general under this act is a
public record subject to the freedom of information act, 1976 PA
442, MCL 15.231 to 15.246. However, a schedule of contributors or
other list of donors to a charitable organization that is not a
private foundation is exempt from disclosure pursuant to section
13(1)(d) of the freedom of information act, 1976 PA 442, MCL
15.243.
(2) For at least 3 years after the date the records are
prepared, a charitable organization or professional fund-raiser
shall maintain accurate and detailed records that include all of
the information required under this act. All records are open to
inspection at all reasonable times by the attorney general and
copies of the records shall be provided to the attorney general
upon request.
(3) A charitable organization, vendor, commercial coventurer,
professional fund-raiser, person described in section 23a, or other
person that solicits contributions, raises funds, or conducts sales
promotions for a charitable purpose shall maintain at the place
designated in its registration or, if not a charitable
organization, at its principal place of business, the original
records or true copies of the records pertaining to all money or
other property collected from residents of this state and to the
disbursement of that money or property. The records shall be
preserved for at least 3 years after the date prepared.
(4) A file in the office of the attorney general regarding a
closed enforcement action or a settlement in a civil case under
this act is open to public inspection and copying. A requirement of
confidentiality or sealing of records as a condition of an
assurance of discontinuance or settlement of an enforcement or
civil action under this act is prohibited unless it is limited to
protecting information about a donor or other private individual
that is exempt from disclosure under subsection (1) or that a
public body may exempt from disclosure under section 13 of the
freedom of information act, 1976 PA 442, MCL 15.243.
Sec. 9. If a local, county, or area division of a charitable
organization is directly supervised and controlled by a superior or
parent
organization , which that is incorporated , or
qualified to
do
business in this state, or is doing business within in
this
state, the local, county, or area division of that charitable
organization is not required to register under section 3 if the
superior
or parent organization files an application statement
registers on behalf of the local, county, or area division in
addition
to or as part of its application statement. When an
application
statement has been filed the superior or parent
organization's registration. If a registration described in this
subsection is made by a superior or parent organization, it shall
file
the annual report required under sections 14 and 16 this act
on
behalf of the local, county, or area division in such the
detail
as
required by the rules attorney general.
Sec. 10. The attorney general may promulgate rules necessary
for
the administration of this act in accordance with and subject
to
Act No. 306 of the Public Acts of 1969, as amended, being
sections
24.201 to 24.315 of the Michigan Compiled Laws under the
administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to
24.328. Emergency However, the attorney general may not promulgate
emergency
rules may not be promulgated pursuant
to this act.
Sec.
11. (1) An application for a license shall not be
accepted
from a charitable organization located in another state or
country
unless it first designates a resident agent in this state
for
the acceptance of process issued by any court.
(1) (2)
A charitable organization, person, vendor,
or
professional
fund raiser, or professional solicitor, soliciting
contributions
in this state but not maintaining an office within
the
state shall be fund-raiser,
commercial coventurer, vendor, or
other person subject to this act is subject to service of process
as follows:
(a)
By service on its registered resident agent within the
this state, or if there is no registered resident
agent, then upon
the
person who has been designated in the application statement
registration as having custody of books and records within this
state, or upon an officer of the organization at its principal
office. When If service is effected upon
the person designated in
the
registration, statement a copy of the process shall be
mailed
to the charitable organization, person, or professional fund-raiser
at its last known address.
(b)
When a charitable organization has solicited contributions
in
this state but does not maintain an office within the state,
have
a registered agent within this state and have a designated
person
having custody of its books and records within the state, or
when
a registered agent or person having custody of its books and
records
within the state cannot be found as shown by the return of
the
sheriff of the county in which the registered agent or person
having
custody of books and records has been represented by the
charitable
organization as maintaining an office, If service cannot
be effected as provided by this section, service may be made as
otherwise provided by law or court rules.
(2) (3)
Solicitation of a contribution within this state by
any
means , is the agreement of the a charitable organization,
person,
professional fund raiser, or
professional solicitor, fund-
raiser, commercial coventurer, vendor, or other person that any
service
of process against it or him which
is served in accordance
with
under this section is of the same legal force and effect
as if
served personally.
Sec.
13. The licensing and financial statement registration
and reporting requirements of this act do not apply to any of the
following:
(a) A person who requests a contribution for the relief or
benefit of an individual, specified by name at the time of the
solicitation, if the contributions collected are turned over to the
named beneficiary after deducting reasonable expenses for costs of
solicitation, if any, and if all fund-raising functions are carried
on by persons who are unpaid, directly or indirectly, for their
services.
(b)
A person who charitable
organization that does not intend
to solicit and receive and does not actually receive contributions
in
excess of $8,000.00 during any 12-month period if all of its
fund
raising functions are carried on by persons who are unpaid for
their
services and if the organization makes available to its
members
and the public a financial statement of its activities for
the
most recent fiscal year. If the gross contributions received
during
any 12-month period exceed $8,000.00, the person shall file
an
application for license with required supporting information as
provided
in section 3 within 30 days after the date it has received
total
contributions in excess of $8,000.00. of more than $25,000.00
in its current fiscal year if all of the charitable organization's
fund-raising functions are carried on by persons who are not paid
for their services. However, if a charitable organization otherwise
exempt under this subdivision receives actual total contributions
in that fiscal year of more than $25,000.00, the charitable
organization must register under this act within 30 days after the
date its total contributions in that fiscal year first exceed
$25,000.00.
(c)
An A charitable organization that does not invite the
general public to become a member of the organization and confines
solicitation activities to solicitation drives solely among its
members, and
the members' directors,
trustees, or their immediate
families. ,
if the drives are not held more frequently than
quarterly.
"Immediate family" for purposes of this subdivision
means the grandparents, parents, spouse, brothers, sisters,
children, and grandchildren of a member, director, or trustee.
(d)
An educational institution certified by the state board of
education
A private foundation that did
not receive contributions
from more than 25 persons during its most recent fiscal year.
(e)
A veterans' organization incorporated under federal law
chartered by congress.
(f) An organization that receives funds from a charitable
organization
licensed registered under this act that does not
solicit or intend to solicit or receive or intend to receive
contributions
from persons other than a the
registered charitable
organization, if the organization makes available to its members
and
the public a financial statement of its activities for the its
most recent fiscal year.
(g)
A licensed hospital, hospital based foundation, and or
hospital
auxiliary that solicit solicits funds solely for 1 or more
licensed hospitals.
(h)
A nonprofit service organization that is exempt from
taxation
pursuant to a provision of the United States internal
revenue
code other than section 501(c)(3), whose principal purpose
is
not charitable, but solicits from time to time funds for a
charitable
purpose by members of the organization who are not paid
for
the solicitation. The funds shall be wholly used for the
charitable
purposes for which they were solicited, and the
organization
shall file with the attorney general a federal form
990
or 990 AR. A booster group or
a parent-teacher organization
that is recognized by the public school, nonpublic school, or
school district that it is organized to support.
(i)
A nonprofit corporation whose stock is wholly owned by a
religious
or fraternal society that owns and operates facilities
for
the aged and chronically ill in which no part of the net income
from
the operation of the corporation inures to the benefit of a
person
other than the residents. A
public school, nonpublic school,
preschool, or institution of higher education organized,
incorporated, or formed under the laws of this state.
(j)
Charitable organizations licensed by the department of
social
services that serve children and families.
(j) (k)
A person registered under and complying with the
requirements of the public safety solicitation act, 1992 PA 298,
MCL 14.301 to 14.327.
Sec.
16. The In addition to the
remedies available under
section
3b, the attorney general may continue
under conditions the
license
impose conditions on the registration of an a charitable
organization , or professional
fund raiser, or professional
solicitor
which fund-raiser that fails to comply with this act
including
failure to comply with the rules regarding prohibited
transactions,
standards of solicitation, conduct, or administration
or rules promulgated under this act.
Sec.
18. (1) A person shall not use for the purpose of
soliciting
contributions the name of another person, except that of
an
officer, director, or trustee of the charitable organization by
or
for which contributions are solicited, without the consent of
such
other person. A charitable
organization, professional fund-
raiser, person described in section 23a, commercial coventurer, or
vendor or an employee or agent of a charitable organization,
professional fund-raiser, person described in section 23a,
commercial coventurer, or vendor, shall not do any of the
following:
(a) Engage in a method, act, or practice in violation of this
act or a rule promulgated under this act; any restriction,
condition, or limitation placed on a registration; or any order
issued under this act.
(b) Represent or imply that a person soliciting contributions
or other funds for a charitable organization has a sponsorship,
approval, status, affiliation, or other connection with a
charitable organization or charitable purpose that the person does
not have.
(c) Represent or imply that a contribution is for or on behalf
of a charitable organization, or using an emblem, device, or
printed material belonging to or associated with a charitable
organization, without first obtaining written authorization from
that charitable organization.
(d) Use a name, symbol, or statement so closely related or
similar to a name, symbol, or statement used by another charitable
organization or governmental agency that use of that name, symbol,
or statement would tend to confuse or mislead a solicited person.
(e) Use a bogus, fictitious, or nonexistent organization,
address, or telephone number in any solicitation.
(f) Make a misrepresentation to a person by any manner that
would lead that person to believe that another person, on whose
behalf a solicitation effort is conducted, is a charitable
organization or that all or any part of the proceeds of a
solicitation effort are for charitable purposes.
(g) Make a misrepresentation to a person by any manner that
would lead that person to believe that another person sponsors,
endorses, or approves a solicitation effort if that other person
has not given written consent to the use of his or her name for
that purpose.
(h) Make a misrepresentation to a person by any manner that
would lead that person to believe that registration under this act
constitutes endorsement or approval by a department or agency of
any state or the federal government.
(i) Represent or imply that the amount or percentage of a
contribution that a charitable organization will receive for a
charitable program after costs of solicitation are paid is greater
than the amount or percentage of a contribution the charitable
organization will actually receive.
(j) Divert or misdirect contributions to a purpose or
organization other than that for which the funds were contributed
or solicited.
(k) Falsely represent or imply that a donor will receive
special benefits or treatment or that failure to make a
contribution will result in unfavorable treatment.
(l) Make a misrepresentation to a person by any manner that
would lead that person to believe that a contribution is eligible
for tax advantages unless that contribution qualifies for those tax
advantages and all disclosures required by law are made.
(m) Falsely represent or imply that a person being solicited
or a family member or associate of a person being solicited has
previously made or agreed to make a contribution.
(n) Employ any device, scheme, or artifice to defraud or
obtain money or property from a person by means of a false,
deceptive, or misleading pretense, representation, or promise.
(o) Represent that funds solicited will be used for a
particular charitable purpose if those funds are not used for the
represented purpose.
(p) Solicit contributions, conduct a sales promotion, or
otherwise operate in this state as a charitable organization or
professional fund-raiser, except in compliance with all of the
requirements of this act.
(q) Aid, abet, or otherwise permit a person to solicit
contributions or conduct a sales promotion in this state unless the
person soliciting contributions or conducting the sales promotion
has complied with the requirements of this act.
(r) Fail to file the information and reports required under
this act or fail to provide any information requested by the
attorney general in a timely manner.
(s) Fail to comply with a person's request to remove, or not
to share, the person's personal information, including, but not
limited to, the person's name, address, telephone number, or
financial account information, from any list utilized by a
charitable organization or professional fund-raiser for
solicitation purposes; or selling, leasing, licensing, sharing, or
otherwise allowing any third-party access to any of the person's
personal information, except as specifically required by law or
court order.
(t) Solicit or receive a contribution or conduct a charitable
sales promotion for, or sell memberships in, a charitable
organization subject to this act if that charitable organization is
not registered under this act.
(u) Submit any of the following to the attorney general:
(i) A document or statement that purports to be signed,
certified, attested to, approved by, or endorsed by a person if
that signature, certification, attestation, approval, or
endorsement is not genuine or was not given by that person.
(ii) A document containing any materially false statement.
(v) Violate the terms of an assurance of discontinuance or
similar agreement accepted by the attorney general and filed with
the court under this act.
(w) For a charitable organization, fail to verify that all
professional fund-raisers with which the organization has
contracted for fund-raising services are currently registered under
this act.
(x) For a professional fund-raiser, fail to provide
verification of current registration status and inform any
charitable organization with which it has contracted for fund-
raising services of any changes affecting its registration or
bonding, in writing, within 14 days of the change.
(y) Submit financial statements, including IRS form 990 and
any other financial report required under this act, that contain
any misrepresentation with respect to the organization's
activities, operations, or use of charitable assets.
(z) Wear a law enforcement or public safety uniform or
clothing similar to a law enforcement or public safety uniform when
making a face-to-face solicitation or collection of contributions.
(2)
A person has used the name of another person for the
purpose
of soliciting contributions if the latter person's name is
listed
on stationery, an advertisement, brochure, or in
correspondence
by which a contribution is solicited by or on behalf
of
a charitable organization or the name is listed or referred to
in
connection with a request for a contribution as one who has
contributed
to, sponsored, or indorsed the organization or its
activities.
(2) (3)
This section does not prevent the publication of names
of contributors without their written consent in an annual or other
periodic report issued by a charitable organization for the purpose
of reporting on its operations and affairs to its membership or for
the purpose of reporting contributions to contributors.
(4)
A charitable organization or professional fund raiser
soliciting
contributions shall not use a name, symbol, or statement
so
closely related or similar to that used by another charitable
organization
or governmental agency that would tend to confuse or
mislead
the public.
(3) (5)
A charitable organization, whether
or not exempt or
not
from this act, shall supply to each
solicitor and each
solicitor shall have in his or her immediate possession
identification
which that sets forth the name of the solicitor and
the name of the charitable organization on whose behalf the
solicitation is conducted.
Sec. 19. (1) A vendor shall not conduct a charitable sales
promotion or solicitation campaign in which it uses the name of a
charitable organization that is not registered in this state.
(2) A vendor shall prominently display the following
information on each vending machine, honor box, novelty machine, or
similar device through which that vendor conducts a charitable
sales promotion or solicitation campaign:
(a) The name of the vendor and the fact that the vendor owns
the vending machine, honor box, novelty machine, or similar device.
(b) The percentage of sales, if any, that a charitable
organization will receive.
(c) The amount that a charitable organization will receive
regardless of sales, if any.
Sec. 19a. (1) Before making an oral request for a contribution
and contemporaneously with a written request for a contribution, a
charitable organization, professional fund-raiser, or vendor
soliciting the contribution shall disclose the name and location by
city and state of each charitable organization on behalf of which
the solicitation is made. If a solicitation is made by direct
personal contact, the information required under this section shall
also be disclosed prominently on any written document exhibited to
the person solicited. If a solicitation is made by radio,
television, letter, telephone, or any other means not involving
personal contact, the information required under this section shall
be disclosed prominently in the solicitation. The information
required under this section shall also be disclosed prominently on
any invoices, bills, fulfillment requests, letters, pamphlets, or
brochures used to obtain payment of a pledge or promise to make a
contribution.
(2) In addition to the information required under subsection
(1), a professional fund-raiser that orally solicits contributions
in this state shall also disclose the professional fund-raiser's
name as filed with the attorney general and a statement that the
solicitation is being conducted by a professional fund-raiser. The
information required under this subsection shall be provided in the
same manner as the information required under subsection (1).
Sec.
20. (1) The attorney general may institute In addition to
any other action authorized by law, the attorney general may bring
an
action in any circuit court to enjoin preliminarily or
permanently
a charitable organization, professional fund raiser,
solicitor,
or other person who: (a) Engages in a method, act, or
practice
in violation of this act or any of the rules promulgated
hereunder.
(b) Employs or uses in a solicitation or collection of
contributions
for a charitable organization on behalf of any other
person
for a charitable purpose a device, scheme, or artifice to
defraud,
or for obtaining money or property by means of any false
pretense,
deception, representation, or promise. an act or practice
prohibited under this act. After finding that a person has engaged
in or is engaging in a prohibited act or practice, a court may
enter any appropriate order or judgment, including, but not limited
to, an injunction, an order of restitution, or an award of
reasonable attorney fees and costs. A court may award to this state
a civil fine of not more than $10,000.00 or less for each violation
of this act against a professional fund-raiser, charitable
organization, against an officer, director, shareholder,
controlling member, or any other person that directly engaged in,
authorized, or was otherwise legally responsible for the prohibited
act or practice, or against any combination of those persons. A
court is not required to find irreparable harm to enter an
injunction, but need only find a violation of this act or find that
an injunction would promote the public interest.
(2)
In addition to any relief afforded under this section, the
attorney
general may exercise the authority to suspend or revoke a
license
issued pursuant to this act. In
addition to any other
remedy, a charitable organization, professional fund-raiser, or any
other person who violates an injunction or other order entered
under subsection (1) shall pay to this state a civil fine of not
more than $10,000.00 for each violation, which may be recovered in
a civil action brought by the attorney general.
(3)
The attorney general may exercise the authority granted in
this
section against a charitable organization or person which or
who
operates under the guise or pretense of being an organization
or
person exempted by this act and is not in fact an organization
or
person entitled to such an exemption. In addition to any other
action authorized by law, the attorney general may issue a cease
and desist order, issue a notice of intended action, or take other
action in the public interest. The attorney general may accept an
assurance of discontinuance of any method, act, or practice in
violation of this act from any person alleged to be engaged in or
to have been engaged in that method, act, or practice. An assurance
of discontinuance may include a stipulation for the voluntary
payment of the costs of investigation, for an amount to be held in
escrow pending the outcome of an action or as restitution to an
aggrieved person, or for the voluntary payment to another person if
in the public interest. An assurance of discontinuance shall be in
writing and shall be filed with the circuit court for Ingham
county. An action resolved by an assurance of discontinuance may be
reopened by the attorney general at any time for enforcement by a
court or for further proceedings in the public interest. Evidence
of a violation of an assurance of discontinuance is prima facie
evidence of a violation of this act in any subsequent proceeding
brought by the attorney general.
(4) A person who has violated section 18 is subject to 1 or
more of the following penalties:
(a) Placement of a restriction or condition on the person's
registration.
(b) Denial, suspension, or revocation of a registration.
(c) A civil fine of not more than $10,000.00. Money collected
under this subdivision shall be forwarded to the state treasurer
for deposit in the general fund of the state.
(d) A requirement to take some type of affirmative action,
including the payment of restitution.
(5) The attorney general shall, before suspending or revoking
a registration, provide the person against whom the penalty is to
be imposed an opportunity for a hearing in accordance with the
administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to
24.328.
Sec.
21. (1) The attorney general may investigate the
operations
or conduct of charitable organizations, professional
fund
raisers, or professional solicitors subject to this act. He
may
require a person, corporation, institution, or association, and
the
officers, members, and employees and agents thereof, to appear
at
a named time and place in the county designated by the attorney
general
or where the person resides or is found, to give
information
under oath and to produce books, memoranda, papers,
records,
documents of title, evidence of assets, liabilities,
receipts,
or disbursements in the possession or control of the
person
ordered to appear. a
complaint from any person in whatever
manner the attorney general considers appropriate and may
investigate on his or her own initiative a charitable organization,
professional fund-raiser, vendor, commercial coventurer, or person
described in section 23a. The attorney general may require a person
or an officer, member, employee, or agent of a person to appear at
a time and place specified by the attorney general to give
information under oath and to produce books, memoranda, papers,
records, documents, or evidence of assets, liabilities, receipts,
or disbursements in the possession of the person ordered to appear.
(2) When requiring the attendance of a person or the
production
of documents, the attorney general requires
the
attendance
of a person, he shall issue an
order setting forth the
time when and the place where attendance or production is required
and
shall cause the same to be served serve the order upon the
person in the manner provided for service of process in civil cases
at least 5 days before the date fixed for attendance or production.
The order shall have the same force and effect as a subpoena and,
upon
application of the attorney general, obedience to the order
may
be enforced by a court having jurisdiction over the person , or
the
circuit court for the county of Ingham , or for the county
where
the person receiving it the
order resides or is found, in the
same
manner as though the notice were a subpoena. In case of
contumacy
If a person fails or refusal refuses to obey the order
issued by the attorney general, the court may issue an order
requiring
the person to appear before the court, or to produce
documentary
evidence, if so ordered, or to give evidence touching
testimony concerning the matter in question. Failure to obey the
order
of the court shall be punished is
punishable by that court as
a
contempt. The investigation may be made
conducted by or before an
assistant
attorney general or other person designated in writing by
the
attorney general. to conduct the investigation. The attorney
general
or the assistant attorney general acting in his behalf
other designated person may administer the necessary oath or
affirmation to witnesses.
(3) This act does not limit or restrict the powers or duties
of the attorney general that are authorized under any other
provision of law.
Sec. 22a. If an oral pledge or promise to make a contribution
follows a telephone or door-to-door solicitation, that pledge or
promise to make a contribution is unenforceable. This section does
not affect any existing rights or remedies regarding oral pledges
or promises not preceded by a telephone or door-to-door
solicitation.
Sec. 23. (1) A person who does any of the following is guilty
of a misdemeanor punishable by imprisonment for not more than 6
months
or a fine of not more than $500.00,
or imprisonment for not
more
than 6 months $5,000.00, or both,
for each violation:
(a)
Violates this act.
(b)
Solicits and receives public donations, or sells
memberships
in this state for and on behalf of any organization,
institution,
or association subject to the provisions of this act
and
which is not duly licensed pursuant to this act.
(c)
Solicits funds under a license and thereafter diverts the
same
to purposes other than that for which the funds were
contributed.
(a) Knowingly misrepresents or misleads any person in any
manner to believe that a person on whose behalf a solicitation
effort is conducted is a charitable organization or that the
proceeds of a solicitation effort are for charitable purposes.
(b) Knowingly diverts or misdirects contributions to a purpose
or organization other than for which the funds were contributed or
solicited.
(c) Knowingly misrepresents that funds solicited or
contributed will be used for a specific charitable purpose.
(d) Knowingly misrepresents that a donor will receive special
benefits or treatment or that failure to make a contribution will
result in unfavorable treatment.
(e) Employs any device, scheme, or artifice to defraud or
obtain money or property from a person by means of a false,
deceptive, or misleading pretense, representation, or promise.
(f) Knowingly fails to file any materials, information, or
report required under this act.
(g) Engages in any of the following practices and wrongfully
obtains more than $1,000.00 and less than $5,000.00, in the
aggregate, as a result of the practice or practices:
(i) Knowingly misrepresents that a person soliciting
contributions or other funds for a charitable organization has a
sponsorship, approval, status, affiliation, or other connection
with a charitable organization or charitable purpose that the
person does not have.
(ii) Knowingly uses a name, symbol, or statement so closely
related or similar to a name, symbol, or statement used by another
charitable organization or governmental agency that use of that
name, symbol, or statement is confusing or misleading.
(iii) Knowingly uses a bogus, fictitious, or nonexistent
organization, address, or telephone number in any solicitation.
(iv) Knowingly misrepresents or misleads any person in any
manner to believe that a person or governmental agency sponsors,
endorses, or approves a solicitation effort if that person or
agency has not given written consent to the use of the person's or
agency's name for that purpose.
(v) Knowingly misrepresents that the amount or percentage of a
contribution that a charitable organization will receive for a
charitable program after costs of solicitation are paid is greater
than the amount or percentage of the contribution the charitable
organization will actually receive.
(vi) Knowingly solicits contributions, conducts a sales
promotion, or otherwise operates in this state as a charitable
organization or professional fund-raiser unless the information
required under this act is filed with the attorney general as
required under this act.
(vii) Aids, abets, or otherwise permits a person to solicit
contributions or conduct a sales promotion in this state unless the
person soliciting contributions or conducting the sales promotion
has complied with the requirements of this act.
(viii) Knowingly solicits or receives a contribution, conducts a
charitable sales promotion, or sells memberships in this state for
or on behalf of any charitable organization subject to the
provisions of this act that is not registered under this act.
(2) A person who does any of the following is guilty of a
felony punishable by imprisonment for not more than 5 years or a
fine of not more than $20,000.00, or both, for each violation:
(a) Engages in any practice or practices described in
subsection (1)(a), (b), (c), (d), or (e) if the amount of money
fraudulently collected or wrongfully diverted from the charitable
purpose for which the money was solicited exceeds, in the
aggregate, $1,000.00.
(b) Engages in any practice or practices described in
subsection (1)(g) and wrongfully obtains more than $5,000.00, in
the aggregate, as a result of the practice or practices.
(c) Knowingly submits any of the following in materials or
statements required under this act or requested by the attorney
general:
(i) Any document or statement purporting to have been signed,
certified, attested to, approved by, or endorsed by a person when
the signature, certification, attestation, approval, or endorsement
is not genuine or has not been given by that person.
(ii) Any document containing any materially false statement.
(3) For purposes of this section, a person is presumed to have
committed a violation knowingly if the attorney general provided
written notice identifying alleged violations to the person before
the acts or omissions in violation of subsection (1) or (2)
occurred.
(4) In addition to pursuing a criminal action under this
section, the attorney general may bring a civil action for damages
or equitable relief to enforce the provisions of this act.
(5) (2) This section shall does
not be construed to limit or
restrict
prosecution under the general criminal statutes of the
this state.
Sec. 23a. (1) A person that is not a charitable organization,
a professional fund-raiser, or a volunteer supervised by a
charitable organization, but that solicits contributions, conducts
a fund-raising event, or conducts a sales promotion or campaign for
a charitable purpose is subject to this act.
(2) A person subject to this act under subsection (1) is not
required to register or file reports required under this act.
Sec. 23b. The prosecuting attorney for a county may prosecute
a person subject to this act in the same manner as the attorney
general. A county prosecuting attorney shall notify the attorney
general when he or she begins a prosecution pursuant to this
section and provide the attorney general with a copy of the final
judgment in that action.
Enacting section 1. Sections 5, 12, 14, 17, and 22 of the
charitable organizations and solicitations act, 1975 PA 169, MCL
400.275, 400.282, 400.284, 400.287, and 400.292, are repealed.