MILLINGTON, TN (WMC TV) - State charity regulators plan to request a criminal investigation of a Millington-based agency for continuing to solicit contributions as an unregistered charity.
Todd Kelley, director of the Tennessee Division of Charitable Solicitations & Gaming, announced Monday the division assessed Kenny King and the Tennessee Drug Education Association/Shelby County Drug Education Agency, 4595 Columbia Woods Ln., a $622,000 civil penalty for 622 violations of the Tennessee Charitable Solicitations Act.
In a letter to King, Kelley said King "misled donors to believe that contributions obtained from them would be used by the Tennessee Drug Education Association or the Shelby County Drug Education (Agency) for charitable purposes, when, in fact, such was not the case."
Kelley said he intends to submit his case to Shelby County District Attorney General Bill Gibbons for a possible criminal investigation into what Kelley described as illegal collections of cash donations by King and his associates.
"(King) was raising money for his own benefit," said Kelley in a phone call Monday from the division's Nashville offices.
It's the second time King and his group have been fined for illegal soliciting.
In February, the division levied a $5,000 civil penalty on the Tennessee Drug Education Association/Shelby County Drug Education Agency for "soliciting contributions in violation of the Tennessee Charitable Solicitations Act."
The official notice, dated Feb. 25, indicated that as early as last September, King was notified that his organization had "failed to register with (the state charities division)" and that it was operating illegally as an unregistered solicitor.
Shortly after that penalty, Kelley and his investigators asked Bank of America to release the group's account records, canceled checks, debit/credit memos and deposit tickets as part of an ongoing probe of the group's finances and business practices.
The state's records request came shortly after the Action News 5 Investigators confronted the group's telemarketer as he attempted to collect a donation.
Brian Joy, who acknowledged working for the Shelby County Drug Education Agency, called Memphis business owner Andy Wilson three weeks before the confrontation. According to Wilson, Joy explained the Shelby County Drug Education Agency was collecting cash or check donations to design a coloring book that would help civic organizations "keep kids off the street."
Joy didn't know Wilson is a private investigator and principal security consultant of Wilson & Turner, Inc. (http://www.wilson-turner.com/), as well as a fraud expert who teaches criminal justice at the University of Memphis.
"I know (fraud). I recognize it. I see it. I smell it. I just recognize it for what it is," said Wilson.
When Joy arrived, he presented not a coloring book, but a program with the Tennessee Drug Education Association's name on its cover. Its pages listed conventional wisdom about recognizing the signs of drug abuse and descriptions of the most commonly abused controlled substances.
On camera, Joy requested Wilson pay $250 for an ad in the program, then said the program would be donated to civic organizations.
"Churches and stuff like that," Joy said. "They hand them out to community centers and stuff like that."
When the Action News 5 Investigators confronted Joy and told him neither the Tennessee Drug Education Association nor the Shelby County Drug Education Agency is a registered charity, he insisted we present our concerns to his supervisor, Martha P. Adams.
On the phone, Adams said the company is not a charitable organization. She said it is an advertising agency whose clients include the Boys & Girls Club of Greater Memphis and First Baptist Church Millington.
The church's business administrator told Action News 5 he's never heard of either the Tennessee Drug Education Association or the Shelby County Drug Education Agency.
Hyun Cho, vice president of resource development for the Boys & Girls Club of Greater Memphis, sent Action News 5 an e-mail. It said "...no one has done any kind of work or partnership with the Shelby County Drug Education Agency."
"I don't need to talk to you under the advice of my attorney," said Adams when she answered the door at the Millington address.
"Those dollars that people are donating are not going to help anybody," said Wilson after Action News 5 escorted Joy out of Wilson's office.
Just another example of why you should be careful about giving to charities or answering a call from a telemarketer.
First, you should only shop charities that are properly registered with your state. In Tennessee, charities register with the Secretary of State's Division of Charitable Solicitations and Gaming:
Mississippi charities register with the Mississippi Secretary of State's Regulation & Enforcement Division:
The Arkansas attorney general regulates Arkansas charities:
You can search those databases for charities' registration records, percentages of collections, etc.
Professional solicitors for those charities must be registered, too. You should be able to determine how much of each donated dollar the solicitor keeps for administrative costs.
The Better Business Bureau's Wise Giving Alliance tracks charities and their behavior:
If you are a member of a church, you should see if it donates to any charities. Chances are your church's administrators have heavily vetted those charities since the church is donating members' tithes to those causes.
Consider registered charities that raise their own funds, like St. Jude Children's Research Hospital: www.stjude.org/donate. St. Jude needs no introduction when it comes to its success in treating children with terminal illnesses.
Le Bonheur Children's Medical Center has its own foundation for raising funds: https://secure.lebonheur.org/lebonheur/Ways+to+Help/Donate+Now.
Telemarketers must consult the national and state do not call lists before they solicit consumers. The feds have forbidden telemarketers from using robo-dialers, but have allowed robo-calls from banks, phone companies, schools (so they can contact parents with weather closings, health alerts, etc.), airlines/travel sites (so they can send alerts about flight cancellations, etc.) and political candidates.
Tennessee consumers can report telemarketers to the Tennessee Regulatory Authority (www.tennessee.gov/tra).
Mississippi consumers should report telemarketers to the Mississippi Public Service Commission (www.psc.state.ms.us).
Arkansas consumers, contact the Arkansas Public Service Commission (http://www.apscservices.info/telecom.asp).