State Initiative Targets Charities' Compliance

Attorney General Spitzer today announced the results of an initiative to improve oversight of non-profits operating in New York State by targeting thousands of organizations delinquent in filing required annual financial reports with his Charities Bureau.

"Charities have a duty to report in a timely fashion on the use of assets pledged to public purposes," Spitzer said. "This information is critical to our ability to spot and correct abuses when they occur. It also enables the public to make informed decisions about its charitable giving."

"Most of the organizations we contacted were unaware of their failure to file and have moved quickly to resolve delinquencies," Spitzer said. "As for those organizations that deliberately attempt to avoid scrutiny, we will continue to enforce reporting requirements by imposing fines and other penalties."

Under New York law, most non-profits are required to register with the Charities Bureau and report on their finances each year. Roughly 50,000 non-profits have registered with the Charities Bureau, but thousands failed to file reports on time. Beginning in January of this year, the Charities Bureau contacted these delinquent filers and ordered them to submit missing reports.

Of the 3,300 organizations that have resolved delinquencies as a result of the project, nearly three quarters are active organizations that will continue to file with the office on an ongoing basis. Most of the remaining organizations had ceased operations but failed properly to dissolve their corporations and notify the Charities Bureau.

The initiative recovered more than $500,000 in delinquent filing fees. It is estimated that on an annual basis, Spitzer's initiative will net the state as much as $70,000 in fees that would have otherwise go uncollected.

The bureau's staff provided direct assistance to more than 2,000 non-profit organizations, helping them to comply with legal requirements and avoid fines.

Spitzer's office provides the following tips to non-profits to avoid delinquencies:

  • Mark the filing deadline on the organization's calendar to ensure reports are submitted on time.
  • In the event of staff turnover, make sure responsibility for filing reports is properly communicated to incoming officers.
  • To learn about filing requirements, fees and deadlines, consult the Attorney General's publication, "CHAR023 – Summary of Registration Requirements," which is available on the Charities Bureau website at www.ag.ny.gov/bureaus/charities/charindex.html.
  • Contact the Attorney General by email at Charities.Bureau@ag.ny.gov or by phone at (212) 416-8401 for answers to questions about how to comply with filing instructions.

The initiative was organized and run by Charities Bureau Registration Section Chief James Siegal, under the supervision of Charities Bureau Chief Gerald Rosenberg and former Bureau Chief William Josephson. Mr. Siegal was assisted by project team leader Noah Stein and team members Keeya Ragin and Koran Gadsden. The Attorney General's Legal Technology & Systems Management Bureau, under the leadership of Director Robert Vitello, contributed to the initiative, with Development Technologies Section Head Ed Twiss and team members Keith Cross, Kevin Van Ness, Al Yasus and Gerry Kerwin providing database enhancements that allowed the Charities Bureau easily to identify delinquent filers.

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