Cracking Down on Fraud

(Feb. 18) – A bill by Rep. Beth McCann, D-Denver, and Rep. Polly Lawrence, R-Roxborough Park, to crack down on charitable fraud passed the House Judiciary Committee unanimously this afternoon. HB16-1129 strengthens enforcement against this type of fraud by increasing penalties and expanding the definition of charitable fraud. Charitable fraud is the use of deception to personally profit from people who believe they are donating to charity.

“We need to protect our citizens from people pretending to be charitable organizations when in reality the money goes to scammer’s pockets,” said Rep. McCann. “It’s important for the penalty to match the crime and be harsh enough to serve as a deterrent, and this bill does that.”

HB16-1129 is the result of recommendations from the Attorney General Consumer Protection division to strengthen the Charitable Solicitations Act. It increases penalties from a $2,000 fine per violation with a cap of $5,000 for a series of violations to penalties up to $10,000 per violation and no cap for a series of violations. The bill places additional requirements on paid solicitors when registering with the Secretary of State’s office to ensure the solicitor will perform in good faith. The bill also makes it an offense to solicit on behalf of an organization that purports to have significant membership of a certain type, like firefighters, when the organization does not.

“States such as Colorado need to equip ourselves to fight charitable fraud both to protect ourselves and go after such bad actors,” said Alissa Gardenswartz, Deputy Attorney General for Consumer Protection. “Currently we can get up to $2,000 per violation with a cap of $5,000. Increasing this to $10,000 with no cap sends a strong message that this will not be tolerated in Colorado.”

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