Charitable organizations: crowdfunding solicitors.

The Supervision of Trustees and Fundraisers for Charitable Purposes Act governs charitable corporations, unincorporated associations, trustees, commercial fundraisers, fundraising counsel, commercial coventurers, and other legal entities holding or soliciting property for charitable purposes over which the state or the Attorney General has enforcement and supervisory powers. Under the act, any person who violates any of the act's provisions with intent to deceive or defraud any charity or individual is liable for a specified civil penalty. The act also authorizes the Attorney General to impose other specified civil penalties for related acts and omissions. Additionally, the act requires various written reports to be filed with the Attorney General under oath, in accordance with rules and regulations. The act prohibits specified acts and practices in the planning, conduct, or execution of any solicitation or charitable sales promotion including misrepresenting or misleading anyone in any manner to believe that another person sponsors, endorses, or approves a charitable solicitation or charitable sales promotion when that person has not given consent in writing to the use of the person's name for these purposes. The act also prohibits representing that any part of the contributions solicited by a charitable organization will be given or donated to any other charitable organization unless that organization has consented in writing to the use of its name prior to the solicitation. This bill would create an exception from these specific written consent requirements in certain circumstances for a crowdfunding solicitor for charitable purposes, which the bill would define as a person, whether for profit or not, who engages in charitable crowdfunding solicitation and who is not defined as certain other types of fundraisers or persons, as specified. The bill would require a crowdfunding solicitor for charitable purposes to: (1) obtain the written consent of a charitable organization prior to using its name in a solicitation, except as specified, (2) register with the Attorney General's Register of Charitable Trusts, (3) file an annual registration and financial report, (4) pay specified registration or renewal fees, and (5) disclose other information required by the Attorney General, under oath, punishable under penalty of perjury. The bill would make it unlawful for a crowdfunding solicitor to solicit funds in this state for charitable purposes unless that crowdfunding solicitor has complied with the registration or annual renewal and financial reporting requirements established by the bill. The bill would make a failure to comply with these provisions grounds for injunctive and other civil relief. The bill would also establish that a crowdfunding solicitor for charitable purposes is a constructive trustee for charitable purposes and is required to account to the Attorney General for all funds. By expanding the crime of perjury, the bill would impose a state-mandated local program. Existing law requires an individual, corporation, or other legal entity who for compensation solicits funds or property for charitable purposes to disclose that the solicitation is being conducted by a commercial fundraiser for charitable purposes and the name of the commercial fundraiser as registered with the Attorney General. This bill would also require disclosure if the solicitation is being conducted for profit by a crowdfunding solicitor, including the name of that crowdfunding solicitor as registered with the Attorney General. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.