I Have an Opportunity to Personally Vet an Organization That Hasn’t Applied for Non-Profit Status, But Has Raised Thousands of Dollars in the Last Year. I Have Many Questions re: Legitimacy. How Do I Gauge The Line Between Them Having Made Some Mistakes Getting Started v. Fraud?

Hi folks, I have some experience working with a non-profit for quite some time, but I was not a board member, and so I don't quite know the in and out's of what goes into making something compliant with the laws.

What I do know though is that for the last year, I have been watching a man appealing to my neighborhood for donations, for a project that involves kids and I have done some background checks on the man and discovered that he doesn't seem to live in this area which is somewhat affluent in parts, and he has a criminal record in another state for theft related issues. There is more than one charge. There's at least 4 or 5 charges.

He seems to have a habit of raising money online for "charity" but doesn't ever have any 501c3 sponsors, and no tax ID. He always says it's for a good cause, and treats it like it's charity, but doesn't have the designation official.

My concern is that while he openly produces "results" that encourage a lot of donations, but I am not sure if the results justify the money that is raised, or what is done with it all. He has openly displayed owning a high priced-luxury automobile and I am not sure what legitimate means he had to purchase it with so I don't know if he is running a scam that involves kids, in which showing minimal results nets him a greater self profit at the expense of the youth and donors.

I know it's not unheard of or illegal for non-profit workers to receive salaries or stipends, etc, so it's hard to say what is going on with him and the money taken for the group. He claims that some of the money goes to youth, but the youth are also "volunteering" for a stipend and I have some concerns for the exploitation of child labor, if he is taking an unfair cut of this money.

He posts often online which results in people sending him money each time, and last time he posted people were asking about his board status and his non-profit status and he said he had neither, but was open to help setting it up.

I offered to see if there is anyway I can help, in part because this will give me a chance to get the information I need. I feel like if he is acting in good faith, it would be okay for me to help, but if he is not, I think I need go report this to the local authorities because he is involving children. I want to be fair, he has a record so I am skeptical, but I know people can turn themselves around, and do good things. I just don't know how to spot the line between making some mistakes getting things started, v how to spot obvious fraud.

If anyone has any advice on how to proceed, or what to take into account, I would appreciate that as I have been concerned about this organization for some time now. I feel like when people are very concerned, they should do their part to protect the kids, so here I am.


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