Attorney General Suthers Shuts Down Charity Targeting Holiday Donors

DENVER – Colorado Attorney General John Suthers today announced that his office has shut down a Lakewood-based charity, Family Relief Fund, which used donations earmarked for veterans and the elderly for personal expenses, including the solicitors’ rent payments.

The Attorney General’s Office has obtained a court order prohibiting any further solicitation or collection of donations, freezing the charity’s bank account, and impounding its donors’ telephone numbers and addresses. Raymond Smith and Marlene (Mindy) Stokes, the two individuals who operated the charity from their home, are prohibited from making any further solicitations on behalf of any charity.

“For many Coloradans, the holiday season is a time of compassion and giving,” said Attorney General Suthers. “Those who prey upon others’ kindness must not be tolerated, and they will be held accountable under the law.”

The Attorney General’s lawsuit alleges that Family Relief Fund solicited donations by claiming the money would provide food to veterans and the elderly, most recently for Thanksgiving food baskets. Smith and Stokes directed victims to place donation checks on porches and under doormats, where a driver would collect the donation almost immediately. According to the complaint, Family Relief Fund kept no records detailing its expenditures, and Smith and Stokes used at least some of the charitable donations to pay their rent and for other personal expenses. 

The lawsuit further alleges that Smith and Stokes falsely represented that donations to Family Relief Fund were tax deductible. Smith and Stokes never applied for charitable status on behalf of Family Relief Fund, nor did they properly register Family Relief Fund with the Colorado Secretary of State’s Office as required by law.

The temporary injunction was signed by Jefferson County District Court Judge Phillip McNulty on November 24. The state is seeking a permanent injunction, restitution, and penalties.

Attorney General Suthers encourages Coloradans to consider these important tips before donating to any charity:

Check out the charity before you give, particularly if you are unfamiliar with it. You can confirm a charity’s registration status with the Secretary of State’s Office (www.sos.state.co.us), its tax exempt status with the Internal Revenue Service (www.irs.gov) and can obtain further information on a charity with the Better Business Bureau’s "Wise Giving Alliance" (http://www.bbb.org/us/charity/)

Don't be pressured to make an immediate decision. Be suspicious if the solicitor insists upon an immediate donation or offers to send a courier to pick up your contribution.

Don't be swayed by strong emotional appeals. Take some time to examine the charity's claims and to consider alternatives.

If a solicitor calls you, ask for their registration number and the registration number of the charity they are representing. This will help you investigate the charity with the Secretary of State.

Ask every solicitor, "How much of my donation will actually go to the charitable organization?" Charities are required by law to provide this information if asked. If you think the percentage is too low, tell them "No, thank you."

Ask every solicitor and charity, "Is my contribution tax deductible?" Charities must indicate their tax-exempt status in their registration statements. Tax exempt does not necessarily mean that contributions are tax deductible.

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