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AMENDED
May 24, 2000
S. 732
S. Printed 5/24/00--H.
Read the first time March 15, 2000.
TO AMEND CHAPTER 56, TITLE 33, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE SOLICITATION OF CHARITABLE FUNDS ACT, SO AS TO REVISE THE CONTENT BY, INTER ALIA, ADDING CERTAIN DISCLOSURE REQUIREMENTS, DEFINITIONS OF AFFECTED SOLICITORS, PENALTIES FOR VIOLATIONS, AND TECHNICAL CHANGES.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 56, Title 33 of the 1976 Code is amended to read:
Section 33-56-10. This chapter may be cited as the 'South Carolina Solicitation of Charitable Funds Act'.
Section 33-56-20. As used in this chapter, unless a different meaning is required by the context:
(1) 'Charitable organization' means:
(a) any person deemed by the Internal Revenue Service to be a tax exempt organization pursuant to Section 501(c)(3) of the Internal Revenue Code;
(b) any person who is or holds itself out to be established for any benevolent, social welfare, scientific, educational, environmental, philanthropic, humane, patriotic, public health, civic, or other eleemosynary purpose, or;
(c) any person who employs a charitable appeal as the basis of solicitation or an appeal that suggests that there is a charitable purpose to any solicitation, or who solicits or obtains contributions solicited from the public for a charitable purpose.
This definition shall not include constituted religious organizations or groups affiliated with and forming an integral part of the organization where no part of the net income inures to the direct benefit of any individual, and which has received a declaration of current tax exempt status from the government of the United States. Religious organizations include those groups incorporated for a religious purpose by this State. A candidate for national, state, or local office or a political party or other group required to file information with the federal election commission or State Election Commission is not a charitable organization.
(2) 'Person' means an individual, organization, trust, foundation, group, association, partnership, corporation, society, or any combination of them.
(3) 'Contribution' means the promise, grant, or pledge of any money, credit, assistance, or property of any kind or value. It does not include bona fide fees, dues, or assessments paid by members of an organization, provided that membership is not conferred solely as consideration for making a contribution in response to a solicitation, and that membership does not bestow only a right to vote.
(4) 'Solicit' and 'solicitation' means the request for money, credit, property, financial assistance, or other thing of value, or any portion of it, which will be used for a charitable purpose or benefit a charitable organization. A solicitation is considered to have taken place whether or not the person making the same receives any contribution.
(5) 'Secretary' means the Secretary of State.
(6) 'Parent organization' means that part of a charitable organization which coordinates, supervises, or exercises control over policy, fund raising, and expenditures, or assists or advises one or more chapters, branches, or affiliates in this State.
(7) 'Professional fund-raising counsel' means a person who for compensation plans, conducts, manages, prepares materials for, advises, or acts as a consultant, whether directly or indirectly, in connection with soliciting contributions for or on behalf of a charitable organization but who actually does not solicit contributions as a part of these services. A bona fide salaried officer or employee of a charitable organization maintaining a permanent establishment within this State, or the bona fide salaried officer or employee of a parent organization certified as tax exempt, is not considered to be a professional fund-raising counsel.
(8) 'Professional solicitor' means a person who, for monetary consideration, solicits contributions for or on behalf of a charitable organization, whether the solicitation is performed personally or through its agents, servants, or employees specially employed by or for a charitable organization, who are engaged in the solicitation of contributions under the direction of such person. 'Professional solicitor' also means a person who plans, conducts, manages, carries on, advises, or acts as a consultant to a charitable organization in connection with the solicitation of contributions but does not qualify as 'professional fund-raising counsel' within the meaning of this chapter. A bonafide salaried officer, unpaid director, or a bonafide full-time employee of a charitable organization or a part-time student employee of an educational institution is not considered to be a professional solicitor.
(9) 'Charitable purpose' means a purpose described in Section 501(c)(3) of the Internal Revenue Code or a benevolent, social welfare, scientific, educational, environmental, philanthropic, humane, patriotic, public health, civic, or other eleemosynary objective.
(10) 'Educational institution' means an organization organized and operated exclusively for educational purposes and which normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of pupils or students in attendance at the place where educational activities are regularly carried on. The term 'educational institution' also includes the following persons, entities, or institutions if none of their fund-raising activities are carried on by professional solicitors as defined by this chapter:
(a) any educational institution that is an eleemosynary junior or senior college in South Carolina whose major campus and headquarters are located within this State and which is accredited by the Southern Association of Colleges and Secondary Schools; and
(b) any person or entity performing sanctioned fund-raising activities on behalf of the educational institutions referenced in subitem (a) above, its foundations, or related or affiliated funds.
(1)(a) 'Charitable organization' means a person, as defined in item (7):
( i) determined by the Internal Revenue Service to be a tax exempt organization pursuant to Section 501(c)(3) of the Internal Revenue Code;
( ii) that is or holds itself out to be established for any benevolent, social welfare, scientific, educational, environmental, philanthropic, humane, patriotic, public health, civic, or other eleemosynary purpose, or for the benefit of law enforcement personnel, firefighters, or other persons who protect the public safety; or
(iii) that employs a charitable appeal as the basis of solicitation or an appeal that suggests that there is a charitable purpose to a solicitation, or that solicits or obtains contributions solicited from the public for a charitable purpose.
(b) This definition does not include:
( i) a bona fide religious organization or group affiliated with and forming an integral part of the religious organization where no part of the net income inures to the direct benefit of an individual and its conduct is supported primarily by government grants or contracts, funds solicited from its own membership, congregation, or previous donors, or fees charged for services rendered in furtherance of its tax-exempt purpose; or
(ii) a candidate for national, state, or local office or a political party or other group required to file information with the Federal Election Commission or State Election Commission.
(2) 'Charitable purpose' means a purpose described in Section 501(c)(3) of the Internal Revenue Code or a benevolent, social welfare, scientific, educational, environmental, philanthropic, humane, patriotic, public health, civic, or other eleemosynary objective, including an objective of an organization of law enforcement personnel, firefighters, or other persons who protect the public safety if a stated purpose of the solicitations includes a benefit to a person outside the actual service membership of the organization.
(3) 'Commercial co-venturer' means a person that regularly and primarily engages in trade or commerce for profit that, for the benefit of a charitable organization, may raise funds by advertising that the purchase or use of goods, services, entertainment, or other thing of value benefits the charitable organization, if it is offered at a price comparable to similar goods or services in the market.
(4) 'Contribution' means the promise, grant, or pledge of money, credit, assistance, or property of any kind or value. It does not include bona fide fees, dues, or assessments paid by members of an organization if membership is not conferred solely as consideration for making a contribution in response to a solicitation, and that membership does not bestow only a right to vote.
(5) 'Educational institution' means an organization organized and operated exclusively for educational purposes, which usually maintains a regular faculty and curriculum and usually has a regularly enrolled body of pupils or students in attendance at the place where educational activities are regularly conducted. The term 'educational institution' also includes the following persons, entities, or institutions if their fund-raising activities are not conducted by professional solicitors as defined by this chapter:
(a) an educational institution that is an eleemosynary junior or senior college in South Carolina whose major campus and headquarters are located within this State and which is accredited by the Southern Association of Colleges and Secondary Schools; and
(b) a person or an entity performing sanctioned fund-raising activities on behalf of the educational institutions referenced in subitem (a) above, its foundations, or related or affiliated funds.
(6) 'Parent organization' means that part of a charitable organization which coordinates, supervises, or exercises control over policy, fund raising, and expenditures, or assists or advises one or more chapters, branches, or affiliates in this State.
(7) 'Person' means an individual, an organization, a trust, a foundation, a group, an association, a partnership, a corporation, a society, or a combination of them.
(8) 'Professional fund-raising counsel' means a person that for compensation plans, conducts, manages, prepares materials for, advises, or acts as a consultant, directly or indirectly, in connection with soliciting contributions for or on behalf of a charitable organization, but that actually does not solicit contributions as a part of these services. A bona fide salaried officer or employee of a charitable organization maintaining a permanent establishment within this State, or the bona fide salaried officer or employee of a parent organization certified as tax exempt, is not a professional fund-raising counsel.
(9) 'Professional solicitor' means a person that, for monetary consideration, solicits contributions for or on behalf of a charitable organization, either personally or through its agents, servants, or employees who are specially employed by or for a charitable organization and who are engaged in the solicitation of contributions under the direction of that person. 'Professional solicitor' also means a person that plans, conducts, manages, carries on, advises, or acts as a consultant to a charitable organization in connection with the solicitation of contributions but does not qualify as 'professional fund-raising counsel' within the meaning of this chapter. A bona fide salaried officer, unpaid director, a bona fide employee of a charitable organization, or a part-time student employee of an educational institution is not a professional solicitor. A paid director or employee is not a professional solicitor unless his salary or other compensation is paid as a commission computed on the basis of funds actually raised or to be raised.
(10) 'Solicit' and 'solicitation' means to request and the request for money, credit, property, financial assistance, or other thing of value, or a portion of it, to be used for a charitable purpose or to benefit a charitable organization. A solicitation takes place whether or not the person making the request receives a contribution.
Section 33-56-30. (A) Except as otherwise provided in this chapter, every a charitable organization which intends to solicit contributions within this State or have contributions solicited on its behalf shall must file a registration statement with the Secretary of State, on forms prescribed by the Secretary of State, by July first of each year but in all cases prior to solicitation. It is the duty of the chief executive officer or chief financial officer of each charitable organization to file the statements required under this chapter. The registration forms and other documents prescribed by the Secretary of State must be (i) signed by the chief executive officer and chief financial officer of the charitable organization, (ii) certified as true, and (iii) filed, along with a fee of fifty dollars.
(B) The statements must be sworn to and contain:
( 1) the name of the organization;
( 2) the purpose for which it was organized;
( 3) the principal address of the organization and the address of any offices in this State. If the organization does not maintain an office, the name and address of the person having custody of its financial records;
( 4) the names and addresses of the chief executive officer, and chief financial officer, directors, trustees, officers, and board members;
( 5) the names and addresses of any chapters, branches, or affiliates in this State;
( 6) the place and date the organization was legally established, and the form of its organization, and a reference to any determination of its tax exempt status under the Internal Revenue Code;
( 7) whether the organization intends to use a professional fund-raising counsel, professional solicitors solicitor, or commercial co-venturer or hire individuals to solicit and, if so, their names and contact information;
( 8) whether it is certified as a tax exempt organization and is authorized by any other governmental authority in this State to solicit contributions a copy of any determination letter recognizing the charitable organization's tax exempt status from the Internal Revenue Service and any changes, amendments, or revocations to that letter unless those documents have been previously filed with the Secretary of State;
( 9) whether it is or has ever been enjoined by any court from soliciting contributions; and
(10) the general purpose for which the solicited contributions to be solicited must are to be used.;
(10) whether the organization is authorized by another local, state, or federal governmental authority to solicit contributions and, if so, a list of each;
(11) whether the organization is or has been the subject of a legal or administrative action concerning a charitable solicitation, fundraising campaign, or campaign with a commercial co-venturer by another local, state, or federal governmental authority including, but not limited to, registration or license revocation or denial, fines, injunctions, or suspensions, and an explanation of all actions;
(12) whether any of the organization's officers, directors, trustees, or board members have been the subject of a criminal conviction, including guilty or nolo contendere pleas, involving any charitable solicitations act, fraud, dishonesty, or false statement in a jurisdiction within the United States and, if so, a description and date of any such conviction;
(13) the charitable organization's Federal Employer's Identification Number (EIN);
(14) the name and address of the registered agent of the charitable organization, if incorporated;
(15) an annual financial report for the immediately preceding fiscal year filed on forms prescribed by the Secretary of State or on the Internal Revenue Service Form 900, 990EZ, or 990PF, unless that report already has been filed with the Secretary of State;
(16) a statement as to the relationship of any of the charitable organization's officers, directors, trustees, or board members by blood, marriage, or adoption to:
(a) each other; or
(b) a director or an officer of a professional fund-raising counsel or professional solicitor under contract with the charitable organization.
If so, the names and addresses of the related parties.
The registration forms and other documents prescribed by the Secretary of State must be signed by the chief executive officer and chief financial officer of the charitable organization and certified as true. Every charitable organization which submits a registration to the Secretary of State must pay an annual registration fee of fifty dollars.
Section 33-56-40. The Children's Trust Fund of South Carolina as established by Section 20-7-5010 is required to register with the Secretary of State but is not required to pay the annual registration fee provided for in Section 33-56-30.
Section 33-56-50. (A) The following are not required to file registration statements with the Secretary of State, provided none of its if their fund-raising activities are not carried on conducted by professional solicitors, professional fund-raising counsel, or commercial co-venturers:
(1) an educational institution which solicits contributions only from only its students and their families, alumni, faculty, friends, and other constituencies, trustees, corporations, foundations, and individuals who are interested in and supportive of the programs of the institution;
(2) persons a person requesting contributions for the relief of an individual specified by name at the time of the solicitation when all of the contributions collected, without any deductions of any kind, are turned over to the named beneficiary for his use, provided that a as long as the person soliciting the contributions is not a named beneficiary;
(3) a charitable organizations organization which (a) do does not intend to solicit nor or receive contributions from the public in excess of twenty thousand dollars during a calendar year or do not receive contributions from more than ten persons during a calendar year and five thousand dollars during a calendar year, or (b)(i) does not intend to solicit or receive contributions from the public in excess of twenty thousand dollars in a calendar year and have (ii) has received letters a letter of tax exemption from the Internal Revenue Service, if all of their functions, including fund-raising activities, of the organization exempted pursuant to this item are carried on conducted by persons who are unpaid compensated no more than five hundred dollars in a year for their services and if no part of their assets or income inures to the benefit of or is paid to any an officer or a member. If the contributions raised from the public, whether all of or not the contributions are or are not actually received by a charitable organization during any calendar year, are in excess of twenty thousand dollars or are received from more than ten people these amounts, within thirty days after the date the contributions exceed twenty thousand dollars or the number of contributors exceeds ten these amounts, it the organization must register with and report to the department Secretary of State as required by this chapter;
(4) organizations an organization which solicit solicits exclusively to their members from its membership, including a utility cooperatives cooperative;
(5) any a veterans' organization which has a congressional charter; and
(6) the State, its political subdivisions, and any agencies an agency or departments a department of it the State which are subject to the disclosure provisions of the Freedom of Information Act.
(B) Any A charitable organization claiming to be exempt from the registration provisions of this chapter and which will or does solicit solicits charitable contributions shall must submit annually to the Secretary of State, on forms to be prescribed by the Secretary of State, the name, address, and purpose of the organization and a statement setting forth the reason for the claim for exemption. If exempted appropriate, the Secretary of State or his appropriate division shall issue a letter of exemption which may be exhibited to the public. No A filing fee is not required of an exempt organization.
Section 33-56-55. The provisions of this chapter do not apply to a parent-teacher associations association affiliated with any a school or to a local chambers chamber of commerce. No Reporting of any fund-raising activities or other reporting under pursuant to this chapter is not required of a parent-teacher associations association or a local chambers chamber of commerce whether or not they would be considered exempt organizations under Section 33-56-50, provided that if none of the fund-raising activities are carried on conducted by professional solicitors.
Section 33-56-60. (A) Each A charitable organization soliciting funds in this State, whether individually or collectively with other organizations, and not exempt under pursuant to Section 33-56-50, whether individually or collectively with other organizations, shall file in the office of the Secretary of State a an annual report of its financial activities, on forms prescribed by the Secretary of State or on Internal Revenue Service Form 990, 990EZ, or 990PF, certified to be true by the organization's chief executive officer and the chief financial officer of it, in the office of the Secretary of State. The report must cover the preceding fiscal year and must be filed within four and one-half months of the close of the organization's fiscal year unless a written extension has been granted by the Secretary of State. To receive an extension, the organization must file with the Secretary of State a copy of the extension request submitted to the Internal Revenue Service.
(B) The annual financial report must include:
(1) specific and itemized support and revenue statements disclosing direct public support from solicitation, indirect public support, government grants, program service revenue, and any other revenue. The report must disclose the amount of direct public support received from direct mail solicitation, telephone solicitation, commercial co-venturers, door-to-door solicitations, telethons, and all other itemized sources;
(2) specific and itemized expense statements disclosing program services, public information expenditures, fund-raising costs, payments to affiliates, management costs, and salaries paid; and
(3) balance sheet disclosures containing total assets and liabilities.
(B)(C) However, if If a charitable organization is required or elects to file a completed Internal Revenue Service Form 990, 990EZ, or 990PF with the Internal Revenue Service, the organization may file the form with the Secretary of State in lieu instead of the report required under by subsection (A) of this section, provided that; however, the form may exclude the information which the Internal Revenue Service would not release pursuant to a Freedom of Information request.
(C)(D) An organization failing which fails to file the a timely annual financial report required by this section may be enjoined from further solicitation of funds in this State in an action brought by the Secretary of State and is ineligible to renew its registration as a charitable organization until the required financial statements are filed with the Secretary of State. An organization failing which fails to file a timely annual financial report required by this section may be assessed by the Secretary of State administrative fines of ten dollars for each day of noncompliance for each delinquent report not to exceed two thousand dollars for each separate violation.
Section 33-56-70. (A) Every A contract or agreement between any professional fund-raising counsel, or professional solicitor, or commercial co-venturer and a charitable organization must be in writing and filed, along with a Notice of Solicitation form, with the Secretary of State within ten days after the contract is made. Every agreement or written statement of the nature of the arrangement to prevail in the absence of a contract between a professional fund-raising counsel or solicitor and a charitable organization must be filed with the Secretary of State within ten days after the contract or written agreement is made at least ten days before the professional fund-raising counsel, professional solicitor, or commercial co-venturer begins any solicitation activity or any other activity contemplated by the contract or agreement in this State. Solicitations or services pursuant to a contract may not begin in this State until the contract has been filed with the Secretary of State and until both the charitable organization and the professional solicitor or professional fund-raising counsel are registered properly with the Secretary of State.
(B) Every A contract filed under pursuant to this section must disclose the amount of compensation the professional fund-raising counsel or solicitor will receive, or if there is no flat fee, the percentage of collected revenues the professional fund-raising counsel or solicitor will receive. Every contract or agreement filed under this section must disclose the name and residence address of each person directing or supervising the conduct of services. Every contract or agreement filed under this section and involving telephone solicitation must disclose the location and telephone numbers from which the soliciting will be conducted. the following, if applicable:
(1) legal name and alias name, address, and registration number, if any, of the professional solicitor, professional fund-raising counsel, or commercial co-venturer;
(2) legal name, address, and registration number of the charitable organization;
(3) name and residence address of each person directing or supervising the contract solicitation services;
(4) description of the event or campaign;
(5) date the solicitation or campaign commences;
(6) date the solicitation or campaign terminates;
(7) statement of the guaranteed minimum percentage of gross receipts to be remitted or retained by the charitable organization, excluding the amount which the charitable organization must pay for fund-raising costs;
(8) statement of the percentage of gross receipts with which the professional solicitor, professional fund-raising counsel, or commercial co-venturer is compensated, including the amount the professional solicitor, professional fund-raising counsel, or commercial co-venturer must be reimbursed as payment for fund-raising costs; and
(9) if applicable, the maximum dollar amount that will benefit the charitable organization.
(C) Every Notice of Solicitation form filed pursuant to this section must disclose:
(1) legal name and alias name, address, and registration number of the professional solicitor, professional fund-raising counsel, or commercial co-venturer;
(2) legal name, address, and registration number of the charitable organization;
(3) date the solicitation activity commences and terminates;
(4) name and residence address of phone room directors for any solicitation activities;
(5) location, including physical address, and telephone numbers from which the solicitation activity, including telephone solicitations, is conducted;
(6) description of all solicitation activity; and
(7) the terms of remuneration for the campaign or event pursuant to the contract.
(D) Within ninety days after a solicitation campaign has been completed, and on or within ninety days after the anniversary of the commencement of a solicitation campaign lasting more than one year, the professional solicitor or the charitable organization must file with the Secretary of State a joint financial report for the campaign, including gross revenue, and an itemization of expenses, and the amount paid to the sponsor. The This joint financial report must be completed on a the form prescribed by the Secretary of State, and signed by both an authorized official of the paid professional solicitor or and an authorized official from of the charitable organization, and certified to be true.
(E) A professional fund-raising counsel, professional solicitor, or charitable organization commercial co-venturer failing to comply with this section is ineligible to renew its registration or continue solicitation activities or campaigns until the required information is filed and is liable for an administrative fine not to exceed ten dollars for each day of noncompliance, with a maximum fine under each nonregistered agreement of two thousand dollars for each separate violation.
Section 33-56-80. Registration statements and applications, reports, professional fund-raising counsel contracts, or professional solicitor contracts, or commercial co-venturer contracts, and all other documents and information required to be filed under pursuant to this chapter or by the Secretary of State are public records in the office of the Secretary of State and are open to the general public for inspection at such a time and under such conditions as the Secretary of State may prescribe. The Secretary of State shall publish and make available to the public and to persons subject to this chapter explanatory information concerning this chapter, the duties imposed by this chapter, and the means for enforcing this chapter.
Section 33-56-90. (1) Upon oral or written request of the solicited party, the solicitor shall deliver to the solicited party a written statement disclosing:
(a) the name and location of the charitable organization;
(b) a description of the charitable purpose for which the solicitation is made; and
(c) a financial statement of the charitable organization disclosing assets, liabilities, fund balances, revenue, and expenses for the preceding fiscal year.
(2) The financial statement under item (1)(c) must be the most recently submitted report under Section 33-56-60.
(3)(A) At the initial time of solicitation Upon oral or written request of the solicited party, a professional solicitor or a solicitor who receives compensation for soliciting shall must disclose his its status as a professional 'professional' solicitor. The professional solicitor or solicitor who receives compensation for soliciting shall also must disclose the registered true name of the professional fund-raising organization and charity he represents for which it works and the registered true name, location, and purpose of the charitable organizations for which it is soliciting. Upon oral or written request of the solicited party, a professional solicitor also must disclose the percentage of gross receipts with which the professional solicitor is compensated including the amount the professional solicitor must be reimbursed as payment for fundraising costs. The professional solicitor also must disclose the guaranteed minimum percentage of gross receipts to be remitted or retained by the charitable organization excluding the amount which the charitable organization must pay for fundraising costs.
(4) Upon request, a professional solicitor shall display or deliver to the solicited party a copy of his registration certification from the Secretary of State.
(B) Upon oral or written request by the solicited party, the professional solicitor must deliver to the solicited party within fifteen business days of the request a:
(1) financial statement of the charitable organization disclosing assets, liabilities, fund balances, revenue, and expenses for the preceding fiscal year. This financial statement must be the most recently submitted annual financial report pursuant to Section 33-56-60; and
(2) copy of the professional solicitor's or charitable organization's current registration certification from the Secretary of State.
(C) A professional solicitor that fails to comply with the provisions of this section is liable for an administrative fine not to exceed two thousand dollars for each separate violation.
(D) An offense committed in violation of this section is considered to have been committed at the place where the solicitation either was initiated or was received.
Section 33-56-100. In accordance with the regulations promulgated by the Secretary of State, every a charitable organization, and professional fundraiser solicitor, professional fund-raising counsel, or commercial co-venturer subject to the provisions of this chapter shall must keep the true fiscal records as to its activities in this State. The records must be retained for at least three years after the end of the period of registration to which they relate.
Section 33-56-110. (A) No A person shall may not act as a professional fund-raising counsel or professional solicitor for a charitable organization subject to the provisions of this chapter, unless he has first without first having registered with the Secretary of State. Registration includes filing of a complete application and filing fee. Applications An application for registration must be in writing under oath or affirmation in the form prescribed by the Secretary of State and contain that information as the Secretary of State may require. The application for registration by a professional fund-raising counsel or professional solicitor must be signed by its chief executive officer and chief financial officer, certified as true, and accompanied by an annual fee of fifty dollars.
(B) The application for a professional fund-raising counsel or professional solicitor must include the:
( 1) legal name of the applicant;
( 2) principal address of the applicant and address of officers and directors of the applicant;
( 3) list of employees, whether full-time, part-time, or contract, and their job titles;
( 4) form of the applicant's business;
( 5) names, addresses, and titles of all current principal officers, directors, individual owners, or partners, and those for the preceding three years;
( 6) list of the full names and addresses of each state in which an applicant is registered currently as a professional fund-raising counsel or professional solicitor;
( 7) list of charitable organizations with which an applicant contracted in this State for the previous three years;
( 8) registration fee of fifty dollars;
( 9) statement as to whether the applicant, or its directors, principal officers, individual owners, or partners, is or has been the subject of a legal or administrative action, including an injunction, concerning a charitable solicitation, fundraising campaign, or campaign with a commercial co-venturer by another local, state, or federal governmental authority including, but not limited to, registration or license revocation or denial, fines, injunctions, suspensions, or voluntary agreement to discontinue any charitable solicitation activity and, if so, a written explanation of those actions;
(10) statement as to whether the applicant, or its directors, principal officers, individual owners, or partners, has been the subject of a criminal conviction, including guilty or nolo contendere pleas, involving any charitable solicitations act, fraud, dishonesty, or false statement in a jurisdiction within the United States and, if so, a description and date of any such conviction;
(11) applicant's federal EIN if incorporated or Social Security number if acting as a sole proprietor;
(12) list of individuals who serve as couriers or employees to personally collect contributed funds from solicited parties, as applicable; and
(13) statement as to the relationship of any of the officers, directors, trustees, or board members of a professional fundraising counsel or professional solicitor to:
(a) each other; or
(b) a director, officer, agent, or employee of a charitable organization under contract with the professional fundraising counsel or solicitor.
(C) At the time of making application, a professional solicitors solicitor shall must file with and have approved by the Secretary of State a surety bond, and a list of all professional solicitors operating under the bond. in which the The applicant or his its employer must be the principal obligor in the sum of fifteen thousand dollars, with one or more sureties that are satisfactory to the Secretary of State, and whose liability in the aggregate as the sureties will at least equal equals that sum, and must maintain the bond in effect so long as a registration is in effect. However, a A deposit of cash in the amount of fifteen thousand dollars may be accepted in lieu instead of the bond. The bond shall run to the State of South Carolina for the use of the Secretary of State or his appropriate division and any a person who may have a has cause of action against the obligor of the bonds bond for losses resulting from malfeasance, nonfeasance, or misfeasance in the conduct of solicitation activities or any violation of this chapter. A partnership or corporation which is a professional solicitor may file a consolidated bond on behalf of all its members, officers, and employees.
(D) Each registration is valid throughout the State for one year and may be renewed for additional one-year periods upon written application under oath in the form prescribed by the Secretary of State and the upon payment of the fee prescribed in this chapter.
(E) A professional fundraisers solicitor or professional fund-raising counsel who fail that fails to comply with the provisions of this section are is liable for an administrative fine not to exceed of ten dollars for each day of noncompliance, with a maximum fine under this paragraph of not to exceed two thousand dollars for each separate violation.
(F) A professional solicitor or professional fund-raising counsel that has been convicted of or pled guilty or nolo contendere to a crime involving charitable solicitation activities or a felony involving fraud, dishonesty, or false statement in a jurisdiction within the United States in the past five years may be ineligible for registration as a professional solicitor or professional fund-raising counsel in the State of South Carolina.
Section 33-56-120. (1)(A) In connection with the solicitation of contributions for or the sale of goods or services, no a person shall not misrepresent or mislead, knowingly and wilfully, misrepresent or mislead anyone a person by any manner, means, practice, or device.
(2)(B) No A charitable organization, professional fund-raising counsel, or professional solicitor shall not use or exploit the fact of registration so as to lead the public to believe that the registration in any way constitutes an endorsement or approval by the State. However, the use of the following statement is not considered a prohibited exploitation: 'Registered with the Secretary of State as required by law'. Registration does not imply endorsement of a public solicitation for contributions.
(3)(C) In connection with the solicitation of contributions or the sale of goods or services for charitable purposes, no a person shall not represent to or lead anyone mislead a person by any manner, means, practice, or device to believe that any other another person sponsors or endorses the solicitation of contributions, sale of goods or services for charitable purposes, or approves of the charitable purposes or a charitable organization connected with it when the other person has not given written consent to the use of his name for these purposes. Any A member of the board of directors or trustees of a charitable organization or any other another person who has agreed either to serve or to participate in any a voluntary capacity in the campaign is considered to have given his consent to the use of his name in the campaign.
(4)(D) No A person shall not make any representation that he is soliciting contributions for or on behalf of a charitable organization or shall not use or display any emblem, device, or printed matter belonging to or associated with a charitable organization for the purpose of soliciting or inducing contributions from the public without first being authorized to do so by the charitable organization.
(5)(E) For the purpose of soliciting contributions from persons a person in this State, no a person shall not use the name of any other another person except that of an officer, a director, or a trustee of the charitable organization by or for which contributions are solicited, without the written consent of the other person. A person is considered to have used the name of another person for the purpose of soliciting contributions if the latter person's name is listed on any stationery, advertisement, brochure, or correspondence in or by which a contribution is solicited by or on behalf of a charitable organization or if his name is listed or referred to in connection with a request for a contribution as one who has contributed to, sponsored, or endorsed the charitable organization or its activities.
(6)(F) Nothing contained in subsection (5) (E) of this section prevents the publication of names of contributors, without their written consent, in an annual or other periodic report issued by a charitable organization for the purpose of reporting on its operations and affairs to its membership or for the purpose of reporting contributions to contributors.
Section 33-56-130. If any a charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer soliciting contributions from people in this State and having a principal place of business outside the State, or organized under and by virtue of the laws of a foreign state, is subject to the provisions of this chapter and does not otherwise appoint a registered agent for service of process, then that charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer is considered to have irrevocably appointed irrevocably the Secretary of State as an agent upon whom may be served summons, subpoena, subpoena duces tecum, or other process directed to the charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer or any a partner, principal officer, or director of it in any action or proceeding brought under the provisions of pursuant to this chapter. Service of process upon is made by delivering to and leaving with the Secretary of State, must be made by delivering to and leaving with him personally a copy of it or with any person designated to receive service at the office of the Secretary of State, and the duplicate copies of the process, notice, or demand. The service is sufficient service, provided, that if notice of the service and a copy of the process are sent by the Secretary of State to the charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer, by registered or certified mail with return receipt requested, at the address set forth provided for in the registration form required to be filed with the Secretary of State pursuant to this chapter or, in default of the filing of the form, at the last address known to the Secretary of State. Service of the process is complete ten days after the receipt by the Secretary of State of a return receipt purporting to be signed by the addressee or a person qualified to receive the registered or certified mail, in accordance with the accepted practices of the United States Postal Service, or, if acceptance was refused by the addressee, ten days after the return to the Secretary of State of the original envelope bearing a notation by the postal authorities that receipt of it was refused.
Section 33-56-140. (1)(A) Upon his own motion or upon complaint of any person, the Secretary of State may investigate any charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer to determine whether the charitable organization, professional fund-raising counsel, or professional solicitor if it has violated the provisions of this chapter or has filed an application, or other information required under by this chapter, which contains false or misleading statements. The Secretary of State may subpoena or audit persons and require the production of books, papers, and other documents to aid in the investigation of alleged violations of this chapter.
(2)(B) If any a charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer fails to file a registration application, statement, report, or other information required to be filed with the Secretary of State under by this chapter, or otherwise violates the provisions of this chapter, the Secretary of State shall must notify the delinquent charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer of this fact by mailing a notice by registered or certified mail, with return receipt requested, to its last known address. If the required registration application, statement, annual report, assurance of voluntary compliance, or other information is not filed, or if the other existing violation is not discontinued, within fifteen days after the formal notification or receipt of the notice, the Secretary of State may assess an administrative fine not to exceed two thousand dollars for each separate violation against the delinquent charitable organization, professional fund-raising counsel, professional solicitor, or commercial co-venturer.
(3)(C) In addition to all other actions authorized by law, the Secretary of State, if he has reason to believe that one or more of the following acts or violations listed below has occurred or may occur, may bring an action to enjoin the charitable organization, professional fund-raising counsel, professional solicitor, commercial co-venturer, or other person from continuing the act or violation, or doing any other acts in furtherance of it, and for such other relief as the court considers appropriate:
(a)(1) a person is knowingly and wilfully operating operates in violation of the provisions of this chapter;
(b)(2) a person has knowingly and wilfully made any makes a false statement in any registration application, statement, report, or other information required to be filed by this chapter;
(c)(3) a person has failed fails to file a registration statement, or annual financial report, or other document required to be filed by this chapter;
(d)(4) a person is employed or is about to be employed in any using in the solicitation or collection of contributions any device, scheme, or artifice to defraud or to obtain money or property by means of false pretense, representation, or promise;
(e)(5) the officers or representatives of a charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer have refused refuse or failed fail, after notice, to produce any records of the organization; or
(f)(6) whenever the funds raised by solicitation activities are not devoted or will not be devoted to the charitable purposes of the charitable organization.
(4) In addition to the provisions of subsection (3), any person who knowingly and wilfully violates the provisions of this chapter or who knowingly and wilfully gives false or incorrect information to the Secretary of State in filing statements or reports required by this chapter, is guilty of a misdemeanor and, upon conviction, for a first offense must be fined not more than one thousand dollars or be imprisoned for not more than thirty days, and for a second or any subsequent offense must be fined not more than five thousand dollars or be imprisoned for not more than one year, or both.
(5)(D) Any registration application, statement, report, or other information required to be filed with the Secretary of State under pursuant to this chapter by a charitable organization, professional fund-raising counsel, or professional solicitor, or commercial co-venturer which contains false or misleading statements may be rejected by the Secretary of State and returned to the submitting party without being filed.
(6)(E) If a A person that is assessed an administrative fine under or enjoined from any solicitation activity for any violation of this chapter, the person or that is denied registration has thirty days from receipt of certified notice from the Secretary of State to pay the fine or request an evidentiary hearing before an administrative law judge. After thirty days, the Secretary of State shall give the delinquent person thirty days' notice that he will seek to enjoin the activities of the person. Before the Secretary of State seeks an injunction, the person may pay the fines or request a hearing before the Secretary of State. A person who fails to remit fines or request a hearing after the required notice is given and after thirty days from the date of receipt of certified notice has elapsed may be enjoined from engaging in further charitable solicitation activities until the fine is paid. A person assessed a fine may request an evidentiary hearing before the Secretary of State in this State and may have its registration suspended pending final resolution. A person may appeal an adverse ruling by the Secretary of State from an evidentiary hearing to the circuit court. An appeal to the circuit court is governed by the standard of review provided in the Administrative Procedures Act and the case law interpreting that provision.
(7)(F) The Secretary of State may exercise the authority granted in this section against a person who that operates under the guise or pretense of being an organization exempted by the provisions of Section 33-56-40 or 33-56-50, and but is not in fact an organization entitled to the exemption.
Section 33-56-145. (A) A person that knowingly and wilfully violates a provision of this chapter with the intent to deceive or defraud an individual or a charitable organization is guilty of a misdemeanor and, upon conviction for a first offense, must be fined not more than five thousand dollars or imprisoned not more than one year, or both. For a second offense or subsequent offense, a person is guilty of a felony and, upon conviction, must be fined not more than ten thousand dollars or imprisoned not more than five years, or both.
(B) A person that knowingly and wilfully gives false or misleading information to the Secretary of State in a registration, filing statement, or report required by this chapter is guilty of a misdemeanor and, upon conviction for a first offense, must be fined not more than two thousand dollars or imprisoned not more than one year, or both. For a second offense or subsequent offense, a person is guilty of a felony and, upon conviction, must be fined not more than five thousand dollars or imprisoned not more than five years, or both.
(C) A person that is convicted or pleads guilty or nolo contendere pursuant to subsection (A) or (B) forfeits the bond described in Section 33-56-110 to the Secretary of State and is prohibited from serving as a professional solicitor or fund-raising counsel in this State for a minimum of five years from the date of the conviction.
(D) A violation of this chapter involving a solicitation is considered to be committed at the place where the solicitation was either initiated or was received.
Section 33-56-150. There is created in the office of the Secretary of State a Division of Public Charities which, under the direction and control of the Secretary of State, shall perform the duties imposed upon it by the provisions of this chapter. The executive and administrative head of the division shall be is the Director of Public Charities designated by the Secretary of State.
Section 33-56-160. The first two hundred thousand dollars in administrative fine revenue received pursuant to this chapter in a fiscal year may be retained by the Secretary of State to offset the expenses of enforcing this chapter. All administrative fines collected pursuant to this chapter in excess of two hundred thousand dollars in a fiscal year must be transmitted to the State Treasurer and deposited in the state general fund. All fees collected under pursuant to this chapter must be transmitted to the State Treasurer and deposited in a fund separate and distinct from the state general fund and used by the Secretary of State for the purpose of administering the provisions of this chapter.
Section 33-56-170. For purposes of Section 33-56-180:
(a)(1) 'Charitable organization' means any organization, institution, association, society, or corporation which is exempt from taxation pursuant to Section 501(c)(3) or 501(d) of Title 26 of the United States Code, as amended.
(b)(2) 'Employee' means an agent, servant, employee, or officer of a charitable organization.
Section 33-56-180. (A) Any A person sustaining an injury or dying by reason of the tortious act of commission or omission of an employee of a charitable organization, when the employee is acting within the scope of his employment, may only recover in an action brought against the charitable organization for only the actual damages he may sustain sustains in an amount not exceeding two hundred fifty thousand dollars the limitations on liability imposed in the South Carolina Tort Claims Act in Chapter 78 of Title 15. An action against the charitable organization under pursuant to this section constitutes a complete bar to any recovery by the claimant, by reason of the same subject matter, against the employee of the charitable organization whose act or omission gave rise to the claim unless it is alleged and proved in the action that the employee acted in a reckless, wilful, or grossly negligent manner, and the employee must be properly joined properly as a party defendant. No A judgment against an employee of a charitable organization may not be returned unless a specific finding is made that the employee acted in a reckless, wilful, or grossly negligent manner. If the charitable organization for which the employee was acting cannot be determined at the time the action is instituted, the plaintiff may name as a party defendant the employee, and the entity for which the employee was acting must be added or substituted as party defendant when it can be reasonably can be determined.
(B) If the actual damages from the injury or death giving rise to the action arose from the use or operation of a motor vehicle and exceed two hundred fifty thousand dollars, nothing in this section prevents does not prevent the injured person from recovering benefits pursuant to Section 38-77-160 but in an amount not to exceed the limits of the uninsured or underinsured coverage.
Section 33-56-190. The Secretary of State may enter into agreements with the appropriate authority of any other another state for the purpose of exchanging information with respect to charitable organizations, professional fund-raising counsel, and professional solicitors, and commercial co-venturers.
Section 33-56-200. The provisions of this chapter are severable. The unconstitutionality of one section or clause does not affect the constitutionality of the entire chapter."
SECTION 2. This act takes effect upon approval by the Governor.
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