Some Snohomish County residents who contributed to a pair of unregistered charities will get refunds after an Edmonds man agreed to an out-of-court settlement of a lawsuit filed by the state attorney general.
The attorney general’s office has a list of contributors who will get some of their money back after they gave to groups called Veterans of Western Washington and Blind Children Services of Puget Sound, said Shannon Smith, assistant attorney general.
Allegations against Blind Children Services and three other individuals associated with both charities are still pending, Smith said.
The state alleged that the defendants illegally solicited donations under numerous charity names, even after the secretary of state’s office canceled their registrations and revoked their authorization to raise funds in 2004.
It also alleged that those soliciting donations told donors the charities were registered when they were not.
Court orders signed last week in Snohomish County Superior Court found that Veterans of Western Washington and Robert Melbourne Shay of Edmonds violated state consumer protection and charitable solicitation laws, Attorney General Rob McKenna said in a statement.
“These judgments will help assure that Robert M. Shay and Veterans of Western Washington cannot solicit charitable donations unless they comply with state laws and provide potential donors with important information about how their money will be spent,” McKenna said.
Shay and Veterans of Washington agreed to pay:
$3,005 in restitution to those who made donations to the organization after October 26, 2004.
$120,000 in civil penalties, which will be suspended if they comply with the order and an injunction regarding fundraising practices.
$13,840 in attorneys’ fees and state costs, with half of that amount suspended.
Shay also must pay $613 restitution for his involvement with Blind Children’s Services of Puget Sound.
Shay acknowledged errors were made but denied wrongdoing.
“I never solicited donations or received a dime from those charities,” Shay said.
He also said he didn’t know the charities weren’t registered.
Shay, himself a Korean War veteran, said he has been tainted by the actions of others. He didn’t pursue his defense because the cost of defending the lawsuit would have been prohibitive.
The state called him a co-owner of the fundraising group, but Shay said he was not. He maintains he helped out the charities by doing their accounting in exchange for office space.
The attorney general questioned Shay’s role.
“Based on the evidence reviewed, (Shay) was much more involved than simply a bookkeeper,” Smith said.
Although Shay will be required to repay more than $3,000, that amount “more likely than not does not reflect the universe of people who contributed,” Smith said. “It reflects those folks we know about.”
Most of the donors live in Snohomish and King counties, she added.
Allegations are still pending against Shay’s son, Michael Joseph Shay, also of Edmonds, and Marcello Manuel Graniel of Guam. Both were associated with the Veterans of Western Washington group. Darin Anthony Dewitt of Everett also is named in the case against Blind Children Services, according to court documents.
The defendants will pay restitution to the attorney general’s office, which will refund eligible people who made donations to Veterans of Western Washington after Oct. 26, 2004, or to Blind Child Services of Puget Sound after May 6, 2005.
The Secretary of State’s office canceled Veterans of Western Washington’s charitable organization registration on Oct. 26, 2004, but the organization continued to solicit donations through at least April 2006, Smith said.
Registration was revoked because the charities solicited donations under other names that were not registered with the state, including Children’s Cancer Alliance, Hospitalized Children’s Society and Coalition Against Domestic Violence, the lawsuits allege.
Getting a refund
Robert M. Shay will be required to pay restitution to the attorney general’s office, which will send refunds to those who made donations to Veterans of Western Washington after Oct. 26, 2004, or to Blind Child Services of Puget Sound after May 6, 2005.
To confirm that a charity is registered, call the secretary of state’s Charities Information Hotline, 800-332-4483, or go to www.secstate.wa.gov/charities.