Is diverting donations to a private source fraud?
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Is diverting donations to a private source fraud?
I own a small vending business, and I donate
all my soda cans and the cans/bottles people
bring to me to a local dog shelter, because I
love dogs. I take a deduction for this, as its a
charity. I found out today, from the owner of
said shelter, that they use some, and give
some to a friend of hers that uses them to buy
her daughter gymnastics equipment.
Im upset by this, and will sever my business
association with them. My question is is this
fraud? Like as if I told people I was donating
them to a shelter, but kept them for myself,
hypothetically?
Asked on January 12, 2019 under Business Law, Massachusetts
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 5 years ago | Contributor
Yes, it is fraud: they misrepresented what they would do with the donatations in order to induce you to make them. A mispresentation like that is fraud, and as was seen recently, when NY slammed the Trump Foundation for misrepresenting what it would do with donatations, this can result even in criminal charges.
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