Enforcement actions by the Ohio Attorney General’s Charitable Law Section have helped improve board governance, stop violations of charitable laws, and recover misused funds.
The Attorney General’s Charitable Law Section takes action to protect Ohio’s charitable donors and ensure charitable funds are used properly. It investigates suspected violations of the state’s charitable laws, and it pursues settlements, assurances of discontinuance, and other enforcement actions to help recover misused charitable funds, stop fraudulent activity, and protect donors and charities.
Recent settlements and actions include:
- Cause for Paws and Eva R. Woods, the group’s incorporator, entered into a March assurance of discontinuance, requiring several operational changes, such as not holding the organization’s funds in the name of an individual officer or board member. An investigation found that the organization’s accounts had not been managed properly.
- Crystal Phoenix and her husband, Eric V. Poole, agreed to dissolve their charity, ROAR Inc., and to pay $10,000 in restitution under an assurance of discontinuance filed in May. An investigation by the Attorney General’s Charitable Law Section found that Phoenix and Poole failed to disclose receiving compensation from the charity and failed to properly manage accounts. Under the assurance, Phoenix and Poole agreed not to handle charitable trust money in Ohio and not to solicit for charities in Ohio.
- John Sillup, a California resident, agreed to dissolve his organization, the Society of Notre Dame, and to pay $26,519 in restitution, which will be redistributed for charitable purposes, under a February settlement that resolved a lawsuit filed by the Ohio Attorney General’s Office in 2016. Sillup was accused of creating and using his charity primarily to pay for personal expenses, even though he claimed the charity was an international organization that helped child refugees. Under the settlement, Sillup agreed to pay a civil penalty, not to work for or solicit for charities in Ohio, and to shut down websites and social media accounts related to the organization.
- Judith Nagy and Advanced Opportunities and Life Enrichment Inc. entered into an April assurance of discontinuance. Under the assurance, Nagy agreed not to hold a position as an officer, trustee, employee, or agent of a charity in Ohio nor solicit for charitable purposes in Ohio. The assurance also called for Advanced Opportunities to dissolve. In a separate but related case, Nagy was indicted in Cuyahoga County on charges of theft, money laundering, and passing bad checks.
- Kimberlee K. Little, a former treasurer of the Southern Local Little Indians, agreed not to serve in a fiduciary capacity for a charity in Ohio under a March assurance of discontinuance. She also agreed not to volunteer for an Ohio charity until completing a nonprofit board governance webinar from the Ohio Attorney General’s Charitable Law Section. Little previously admitted to stealing about $3,200 from the organization, which she later repaid in full.
- Mike Portis, a former president of the Good Shepherd Athletic Club (now dissolved), agreed to pay $1,000 in restitution and a $500 fine under an April assurance of discontinuance. An investigation found that Portis had failed to comply with a 2013 settlement with the Attorney General’s Office, which had required tracking of and board approval of the organization’s expenditures, among other provisions.
- New Lexington Fraternal Order of Eagles #2070 and the Perry County Agricultural Society entered into agreements over the organizations’ handling of instant bingo funds. The settlements outline operational changes to bring the organizations into compliance with state charitable laws. (Generally, in Ohio, veterans or fraternal organizations that conduct instant bingo can keep up to 75 percent of the first $250,000 of net proceeds, but at least 25 percent must be given away to a 501(c)(3).)
- New Way Marketing, and its operator, Johnny Nichols, of West Virginia, entered into a February assurance of discontinuance agreeing not to solicit for charitable donations in Ohio. An investigation determined that New Way Marketing had conducted a solicitation campaign on behalf of an Ohio charity but had failed to properly register with the state.
- Reginald J. Rucker, who formerly served as executive director for Amer-I-Can Cleveland, agreed to never incorporate, organize, or serve in any fiduciary capacity for a charitable organization or charitable trust in Ohio, according to a March assurance of discontinuance. In 2016, Rucker, a former Cleveland Browns player, was sentenced in federal court to 21 months in prison and ordered to pay over $110,000 in restitution, after he was found to have diverted and used charitable funds for personal purposes.
- Robert Burkhart agreed to dissolve the Fairfield County Youth Football League (which has since been reorganized under a different name) and to pay $9,200 in remaining charitable funds to the new organization. He also agreed not to hold a position as an officer or trustee of a charitable organization in Ohio, not to solicit for a charity for five years in Ohio, and to volunteer only if he does not handle charitable funds. An investigation found that while Burkhart was president of the Fairfield County Youth Football League, the organization lacked internal financial controls and strong board governance.
- Timothy Ferguson, president of United Young People Association Inc., agreed to dissolve his organization and not to incorporate any other charity under a March settlement that resolved a 2016 lawsuit. The settlement requires Ferguson to pay at least $24,000 to be redistributed to support workforce development for individuals with disabilities. An investigation found that Ferguson had diverted charitable assets for personal use.
- Trinity Dance Company and Kelly K. Parks entered into an assurance of discontinuance in March. Parks agreed not to incorporate or participate in a nonprofit similar to Trinity Dance Company for a period of five years and not to participate in any nonprofit until taking board governance training from the Ohio Attorney General’s Office. An investigation found that Trinity Dance Company was not registered as a charitable organization in Ohio, that it never obtained 501(c)(3) tax-exempt status from the IRS, and that Parks regularly transferred funds between Trinity Dance Company and Medina Centre for Dance Art, a company she owns.
- Youngstown Dogs, or Y-Town Dogs, and two of its board members agreed to dissolve the organization under a February assurance of discontinuance. An investigation found that the organization had never been properly registered and that its accounts weren’t properly managed.
In addition to investigating alleged violations of state charitable laws and pursuing enforcement actions, the Ohio Attorney General’s Charitable Law Section also maintains registries of charitable organizations and professional solicitors that raise money in Ohio.
To determine whether an organization has registered with the Ohio Attorney General’s Office or to report questionable charitable activity, contact the Ohio Attorney General’s Office at www.OhioAttorneyGeneral.gov or by calling 800-282-0515.