Way back in 2021, the Nevada Legislature passed a law greatly expanding the regulation of fundraising beyond traditional tax-exempt charities. For the first time, almost any kind of non-religious outfit purporting to solicit money within the state–usually on the phone–benefiting various specified causes was barred from doing so without first registering with the Secretary of State’s Office (SOSO) and making financial filings. The enumerated causes included law enforcement, fire fighting, public safety, public health, patriotism, and anything else that sounds like a charitable mission. Also–and crucially–for the first time, the SOSO was given broad authority to issue cease-and-desist orders and issue civil financial penalties, which would also draw public attention to any culprits.
A huge number of these outfits were what I call faux charities (others call them scam charities). These are political action committees, poorly regulated at the federal level, that sound like charities when they cold-call you asking you for money but aren’t. Instead, they spend almost all the money raised in fundraising expense and hidden fees for their operators, generating terrible financial efficiencies. Donors get rooked. These telemarketers, who employ computer-generated voices using soundboard technology, operate nationally, but they seem to find fertile ground in Nevada.
I’ve been writing about these operators and their activities in Nevada for a long time, focusing on the many who were dumb enough to call me–often repeatedly–at the New To Law Vegas world headquarters. (You can find my coverage by entering “faux charity” in the nearby search box.) There undoubtedly have been tens of thousands of such calls over the years to my fellow Nevadans. I’ve yet to find even one of these telemarketers properly registered in the state.
The law, known as Senate Bill 62 and codified at Nevada Revised Statues 82A.025 et seq., took effect on October 1, 2021. On its face, the measure put Nevada in the vanguard of consumer protection on this issue. Ha! Knowing something of the historically weak commitment to effective charitable regulation–or any regulation–by the SOSO, I wrote in this space just 12 days after the law took effect, “Let’s all join the watch party … We’ll see if Nevada regulators invoke their brand new law requiring registration before soliciting.”
On August 2, 2024, I filed a request with the SOSO for information under the Nevada Public Records Act. The agency repeatedly blew a number of statutory deadlines and rules for responding to my request. Finally, the SOSO last week admitted to me in writing just how many civil penalties the agency assessed under the law through December 31, 2024, a time period covering the heyday of faux charity calling.
Zero.
The SOSO also finally admitted to me how many cease-and-desist letters the agency issued to errant fundraisers under the law through December 31, 2024.
Zero. Continue reading
