LITTLE ROCK – Arkansas Attorney General Leslie Rutledge has reached a settlement with the Children of Veterans Foundation, an Arizona-based organization that was accused of soliciting donations from Arkansans and claiming that those donations would be used to benefit the children of American veterans.
Under the terms of the settlement, the foundation and Give Back to Freedom LLC are prohibited from operating in Arkansas and soliciting contributions from Arkansans. The foundation must pay $5,000 to the State to cover the cost of the investigation and prosecution of this matter, and if any violation of the settlement occurs within five years, the foundation will be responsible for $50,000 plus an additional $100,000 in civil penalties.
“Arkansans want to help those in need, especially those who put their lives on the line to defend this country,” said Attorney General Rutledge. “Unfortunately, there are bad actors like the Children of Veterans Foundation that will exploit Arkansans’ generosity for their own personal gain. As the State’s top attorney, I will not stand for this and will continue to hold these organizations accountable for their actions.”
In the lawsuit that was filed in December 2013, it was alleged that the Children of Veterans Foundation diverted clothing items donated by Arkansas consumers to a for-profit company operated by one of two directors of the nonprofit foundation. Though consumers were encouraged to donate used clothing items and shoes to “give back to those who protect our freedom,” the lawsuit stated that the donations were instead used solely for the personal benefit and financial gain of the defendants.
Defendants in the lawsuit are Donna Renfroe and Randy Taylor, both of Arizona, the Phoenix-based Children of Veterans Foundation and the for-profit Give Back to Freedom LLC. Renfroe and Taylor are the directors of the foundation. Taylor is the sole shareholder in Give Back to Freedom LLC.
The defendants solicited donations by placing at least 10 collection bins in parking lots in northwest Arkansas. Signage in large type on the bins encouraged consumers donate to “those who protect our freedom” and say “Proud to support: Children of Veterans 501(c)(3) foundation.” However, a disclaimer in smaller type on the box stated that the “collection site is owned by Give Back to Freedom, LLC, a for-profit company. Items received at the locations would be sold to Give Back to Freedom, LLC.”
The lawsuit stated that using the items to support a for-profit company is inconsistent with the intent of the donors and that the defendants were in violation of the Arkansas Deceptive Trade Practices Act.
In addition, the defendants failed to register as charities or paid solicitors with the Attorney General’s office, as is required under State law.
The Arizona-based Children of Veterans organization is not related to or affiliated with the Arkansas corporation of the same name based in Magnolia.