Local Charity Suspected Of Fraud: Better Business Bureau Alert

CHICAGO, IL -  The Better Business Bureau has received inquiries from northern Illinois residents regarding solicitations for donations to Smiles For Kids Foundation, a charity that lists its mission, as being “100% dedicated to helping provide toys and other educational materials to children with cancer”.

One caller considering a donation to the Foundation became concerned after finding the location listed its address as a UPS Store at 7431 East State Street in Rockford. Another caller also had concerns because of the “homemade” nature of the materials sent to her home seeking a donation.

Although, Smiles For Kids Foundation is organized as an Illinois non-profit corporation, it is not registered with the Illinois Attorney General’s Office as a charity, which is required by Illinois for organizations involved in charitable fundraising.

Recent news reports allege that the Foundation’s owner, Clifford Edwards, Jr. of Dakota, Illinois, has been charged with 20 counts of mail fraud and that he is accused of defrauding victims out of over $120,000 in charitable donations.

According to the reports, Mr. Edwards and his associates were charged with making telemarketing calls, mailing pledge statements, and sponsor confirmations, to individuals who agreed to make donations. The report also states that, after the donations were received, Mr. Edwards allegedly used the funds for personal expenses and to pay fundraising costs.

“The Better Business Bureau always cautions individuals to check out a charity before you write that check to make a donation” said Steve Bernas, president & CEO of the Better Business Bureau serving Chicago and Northern Illinois. “People will nearly always want to help, especially when asked to help a child but knowing exactly too whom and where the money is going is essential.”

According, to Illinois Secretary of State Records, Mr. Edwards was also owner of Helping Out LLC. That organization was involuntarily dissolved in 2009 after no annual report was filed.

The BBB recommends asking the following questions before choosing to donate to a specific charity:

  • Is this a charity I can trust?
Look at the appeal carefully; some charities’ names sound the same. Don’t be fooled by names that look impressive or that closely resemble the name of a well-known organization. Visit www.bbb.org to find out whether a charity meets the 20 BBB charity standards that address charity governance, finances, fund raising, donor privacy, and other accountability issues. Also check with your appropriate state government authorities (this is usually a division of the state’s office of the attorney general) to verify the charity is registered to solicit in your state.
  • How will the charity use my donation?

Ask questions about how your donation will be used. Beware of appeals that bring tears to your eyes but tell you little about what the charity is doing about the problem it describes so well. For example, if the charity says it’s helping the homeless, do they explain how (shelter, food, medical care) and where this is taking place?

  • Watch out for statements such as “all proceeds will go to the charity.” 

This can mean that only the money left after expenses, such as the cost of written materials and fund raising efforts, will go to the charity. These expenses can be high, so check carefully.

  • Can the charity actually use what I’m donating?

All charities welcome the receipt of monetary donations, but some also solicit in-kind donations such as clothing, food, and toys. If you’re planning to donate items to a worthy cause, make sure you know the in-kind contributions your charity prefers. For example, a food bank may prefer food items that are not perishable such as canned goods, and a toy drive may be seeking new and not used toys.

  • Am I feeling pressured to give?

Don’t succumb to pressure to give money on the spot, either immediately over the phone via credit card or by allowing a “runner” to pick up a contribution. Take the time to research the charity fully; the charity that needs your money today will welcome it just as much tomorrow.

For more advice on giving and to view reports on charities, visit www.bbb.org