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ENGROSSED HOUSE
BILL NO. 2363 By: Burns, West (Josh), Mize
and Cornwell of the House
and
Jett of the Senate
An Act relating to charitable organizations; creating
disclosure requirements for solicitation materials;
amending 18 O.S. 2011, Secti on 552.3, as amended by
Section 1, Chapter 4, O.S.L. 2013 (18 O.S. Supp.
2020, Section 552.3), which relates to registration;
modifying required information; amending 18 O.S.
2011, Section 552.14a, which relates to violations of
the Oklahoma Solicitation o f Charitable Contributions
Act; adding certain violation; updating references;
providing for codification; and providing an
effective date.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 552.23 of Title 18, unless there
is created a duplication in numbering, reads as follows:
Every charitable organization who has a gross revenue of One
Million Dollars ($1,000,000.00) or more and every professional
fundraiser that is required to be registered with the Office of the
Secretary of State pursuant to Sections 552.3 and 552.7 of Title 18
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of the Oklahoma Statutes shall disclose all of the following
information at the time of solicitation:
1. The legal name of the charitable organization, any trade
names that the charitable organization uses, any other name the
organization may be identified or known as, or any distinctive names
the organization uses for purposes of solicitation of contributi ons,
as the name(s) appears on file with the Office of the Secretary of
State, on whose behalf the solicitation is being made;
2. Upon request, the program(s) the funds solicited will be
used to support;
3. Upon request, the approximate percentage of co ntributions
solicited in a fiscal year to remain in Oklahoma;
4. Upon request, the process to obtain for free a copy of the
charitable organization 's registration and financial information
from the Office of the Secretary of State ; and
5. On every written or printed solicitation , the following
disclosure statement verbatim:
"Registration on file with the Office of the Secretary of
State."
The disclosure statement shall be prominently displayed by use
of one or more of the following: underlining, a border, or bold
type. Where the solicitation consists of more than one piece, the
disclosure statement shall be displayed on a prominent part of the
solicitation materials. If the solicitation occurs on a website,
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the disclosure statement must be prominently di splayed on any
webpage that identifies a mailing address where contributions are to
be sent, identifies a telephone number to call to process
contributions, or provides for online processing of contributions.
SECTION 2. AMENDATORY 18 O.S. 2011, Section 552.3, as
amended by Section 1, Chapter 4, O.S.L. 2013 (18 O.S. Supp. 2020,
Section 552.3), is amended to read as follows:
Section 552.3 A. No charitable organization that is either
located within this state or that is soliciting c ontributions from
any person in this state, except those specifically exempt under
Section 552.4 of this title, shall solicit contributions until the
charitable organization shall have registered with the Office of the
Secretary of State and filed informat ion, as required by the
Oklahoma Solicitation of Charitable Contributions Act, on forms
approved by that office. At the time of registration, each
charitable organization, except as otherwise provided in this
section, shall pay a fee of Sixty -five Dollars ($65.00). The first
Fifteen Dollars ($15.00) of the fee shall be deposited to the credit
of the General Revenue Fund of the State Treasury. Thirty -four
Dollars ($34.00) of the fee shall be deposited to the credit of the
Attorney General Charitable Solic itations Enforcement Revolving Fund
and the remaining Sixteen Dollars ($16.00) shall be deposited to the
credit of the Secretary of State Charitable Solicitations Revolving
Fund. Provided, a charitable organization whose contributions
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during the previous registration period did not exceed Ten Thousand
Dollars ($10,000.00) , or if this is the charitable organization's
first registration period and the anticipated contributions for the
current registration period are not expected to exceed Ten Thousand
Dollars ($10,000.00), shall pay a fee of Fifteen Dollars ($15.00) of
which Ten Dollars ($10.00) shall be deposited to the credit of the
Attorney General Charitable Solicitations Enforcement Revolving Fund
and the remaining Five Dollars ($5.00) shall be deposited to the
credit of the Secretary of State Charitable Solicitations Revolving
Fund. Each charitable organization that is required to register
under this act shall register annually with the Secretary of State
by the date that the charitable organization fil es its Form 990 or
by the date, plus extensions, that it is required to file its Form
990, whichever occurs first. Registration shall not be deemed to
constitute an endorsement by the state or by the Secretary of State
of any charitable organization or th e proposed uses of the funds
solicited. The information so filed shall be available to the
general public. The charitable organization shall provide the
following information on the required forms:
1. The legal name of the charitable organization, any t rade
names that the charitable organization uses, any other name the
organization may be identified or known as, and any distinctive
names the organization uses for purposes of solicitation of
contributions;
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2. The mailing address of the charitable organi zation which can
be a P.O. box address ;
3. The name and mailing address of:
a. each officer, director, trustee, and/or equivalent, and
b. each salaried executive employee of the charitable
organization;
4. The name and mailing address of:
a. each professional fundraiser or professional solicitor
that will have custody of the contributions, and
b. each person associated with a professional fundraiser,
professional solicitor or charitable organization that
is directly responsible for the payment and
distribution of funds collected;
5. The name and mailing address of each professional
fundraising counsel utilized by the charitable organization;
6. For charitable organizations that register for the first
time, a statement of whether or not the charitable org anization
believes contributions for the first year of registration will
exceed Ten Thousand Dollars ($10,000.00);
7. The purposes for which the contributions solicited are to be
used;
8. For charitable organizations who have a gross revenue of One
Million Dollars ($1,000,000.00) or more, the approximate percentage
of contributions solicited in a fiscal year to remain in Oklahoma;
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9. For the initial registration of a newly formed charitable
organization, a copy of a letter from the Internal Revenue Servi ce,
or other evidence, showing that such organization is exempt from
federal income taxation; or, for a charitable organization that has
not applied for federal income tax exemption with the Internal
Revenue Service or is not required to apply for federal income tax
exemption, evidence showing that said charitable organization is
organized in any state or jurisdiction as a not -for-profit entity;
9. 10. An identification of the period of time or periods
during which solicitations are to be conducted, which may be
specific periods, estimated or projected time frames, or continuous,
and which may involve different periods for different types of
solicitations by the same charitable organization;
10. 11. An identification of the specific method or methods of
solicitation utilized by the charitable organization and its agents;
11. 12. Whether the solicitation is to be conducted by the
following for or on behalf of the charitable organization:
professional fundraisers, employees or volunteers of the charitable
organization, and/or others; and
12. 13. If the solicitation is to be conducted in whole or in
part by professional fundraisers, the names and addresses of each
professional fundraiser involved in the solicitation; the basis of
payment or other considerati on payable to each professional
fundraiser and the nature of the arrangements between the charitable
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organization and each professional fundraiser, the specific amount,
formula or percentage of compensation, or property of any kind or
value to be paid or p rovided to each professional fundraiser; and if
payment is based on a percentage, the amount of compensation as a
percentage of the total contributions received, and the net amount
of the total contributions received (total contributions received,
less expenses of solicitation other than amounts payable to any
professional fundraiser).
B. In addition to the required information in subsection A of
this section, every charitable organization subject to the
provisions of the Oklahoma Solicitation of Charitabl e Contributions
Act that has solicited contributions during the previous fiscal year
shall provide the following information:
1. The gross amount of the contributions, gifts, grants and
other similar amounts received by the charitable organization;
2. The total Program Service Expenses of the charitable
organization;
3. The total Management and General Expenses of the charitable
organization;
4. The total Fundraising Expenses of the charitable
organization; and
5. For charitable organizations who have a gross revenue of One
Million Dollars ($1,000,000.00) or more, the actual percentage of
contributions solicited that remained in Oklahoma;
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6. The actual percentage of funds raised spent on a commission
or fee to a professional fundraiser; and
7. The aggregate amount paid, or payable, to professional
fundraisers and professional fundraising counsel.
C. Any registration form required to be filed under this
section shall be executed by signature, without more, of the person
or persons signing the form, in which case the signature or
signatures shall constitute the affirmation of the signatory, under
penalty of perjury, that the signature is that person's act and deed
or the act and deed of the organization, and that the facts stated
therein are true.
D. If a charitable organization that is registered with the
Secretary of State to solicit contributions in this state changes
its name or the mailing address of its principal office, or plans to
engage in the solicitation of contributions using a name that is not
listed on its registration form, then it shall, prior to soliciting
any funds in this state using any such name, file with the Secretary
of State a statement executed by an authorized officer of the
organization setting forth any new name and mailing a ddress along
with a fee of Twenty -five Dollars ($25.00). Such fee shall be
deposited to the credit of the General Revenue Fund of the State
Treasury.
E. Any fraternal or membership organization not based in
Oklahoma which solicits contributions from any person of this state
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by telephone, or contracts with professional fundraisers to solicit
such contributions, shall be required to have at least one member or
employee of the fraternal or membership organization residing within
the county where the call is received.
SECTION 3. AMENDATORY 18 O.S. 2011, Section 552.14a, is
amended to read as follows:
Section 552.14a A. Applicable to charitable organizations,
professional fundraisers and professional solicitors, the following
shall constitute violations of this act:
1. Knowingly making any false material statement or
representation on a registration application;
2. Using the name of a person when soliciting contributions or
in an advertisement, brochure, stationery or correspondence, without
the consent or approval in writing of such person, other than an
officer, director or trustee of the charitable organization by or
for which contributions are solicited. This paragraph shall not
apply to the use of the name of a person that has co ntributed to or
sponsored an event or program of the charitable organization in a
report, brochure, program or listing of donors, contributors ,
sponsors, or supporters issued or published by a charitable
organization. This paragraph shall not apply to the use of a public
figure's name and/or likeness truthfully and in good faith, so long
as such use does not imply a false endorsement ;
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3. Knowingly using, in connection with solicitation of
contributions for the purpose of deceiving the public, a name
similar to other charitable organization s, professional fundraiser,
professional solicitor or government agency or political
subdivision;
4. Failing to register as required pursuant to Sections Section
552.3, 552.7 or 552.9, as applicable, of Title 18 of the Oklahoma
Statutes this title unless otherwise exempted by this act;
5. Employing in any solicitation or collection of contributions
for a charitable organization any device, scheme or artifice to
defraud or for obtaining money or property by means of any f alse
pretense, representation or promise; and
6. Failing or refusing to supply requested information as
required by Section 552.9 of Title 18 of the Oklahoma Statutes this
title; and
7. Failing or refusing to supply information as required by
Section 1 of this act within a reasonable amount of time .
B. The Attorney General or a district attorney may bring an
action:
1. To obtain a declaratory judgment that an act or practice
violates this act;
2. To enjoin, or to obtain a restraining order against a pe rson
who has violated or is violating this act;
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3. To recover actual damages, restitution, disgorgement and
penalties attributed to a violation of this act;
4. To recover reasonable expenses and investigation fees
attributable to a violation of this act;
5. To prosecute any civil or criminal actions as prov ided by
this act, as applicable; and
6. To revoke the registration of a charitable organizatio n,
professional fundraiser, or professional solicitor for any violation
of this act.
C. In lieu of instig ating or continuing an action or
proceeding, the Attorney General or a district attorney may accept a
consent judgment with respect to any act or practice declared to be
a violation of this act. Such a consent judgment shall provide for
the discontinuance by the person entering the same of any act or
practice declared to be a violation of this act, and it may include
a stipulation for the payment by such person of reasonable expenses,
attorney fees, investigation costs and penalties incurred by the
Attorney General or a district attorney. The consent judgment also
may include a stipulation for restitution to be made by such person
to contributors of money, property or other things received from
contributors in connection with a violation of this act and al so may
include a stipulation for specific performance. Any consent
judgment entered into pursuant to this section shall not be deemed
to admit the violation, unless it does so by its terms. Before any
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consent judgment entered into pursuant to this sectio n shall be
effective, it must be approved by the district court and an entry
made in the manner required for making an entry of judgment. After
such approval is received, any breach of the conditions of such
consent judgment shall be treated as a violatio n of a court order,
and shall be subject to all the penalties provided by law therefor.
D. In any action brought by the Attorney General or a district
attorney, the court may:
1. Make such orders or judgments as may be necessary to prevent
the use or employment by a person of any practice declared to be a
violation of this act;
2. Make such orders or judgments as may be necessary to
compensate any person for damages sustained;
3. Enjoin any person from engaging in solicitation of
charitable contribution s in this state;
4. Revoke the registration of a charitable organization,
professional fundraiser or professional solicitor;
5. Enter any order that is appropriate in a criminal
prosecution of crimes identified in this act or any other state law;
and
6. Grant other appropriate relief.
E. When an action is filed under this act by the Attorney
General or a district attorney, no action seeking an injunction or
declaratory judgment shall be filed in any other district in this
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state based upon the same trans action or occurrence, series of
transactions or occurrences, or allegations that form the basis of
the first action filed.
F. When the Attorney General or a district attorney has reason
to believe that a person has engaged in, is engaging in or is about
to engage in any practice declared to be in violation of this act
and he or she believes it to be in the public interest that an
investigation should be made to ascertain whether a person has in
fact engaged in, is engaging in or is about to engage in any s uch
practice, he or she may execute in writing and cause to be served
upon any such person who is believed to have information,
documentary material or physical evidence relevant to the alleged
violation an investigative demand requiring such person to fur nish,
under oath or otherwise, a report in writing setting forth the
nonprivileged relevant facts and circumstances of which the person
has knowledge, or to appear and testify, or to produce relevant
nonprivileged documentary material or physical evidence for
examination at such reasonable time and place as may be stated in
the investigative demand, concerning the solicitation of charitable
contributions.
G. To accomplish the objectives and to carry out the duties
prescribed by this act, the Attorney Gener al or district attorney,
in addition to other powers conferred on him or her by this act or
the laws of this state, may issue subpoenas or other process to any
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person and conduct hearings in aid of any investigation or inquiry,
administer oaths and take sw orn statements under penalty of perjury,
and serve and execute in any county, search warrants; provided, that
none of the powers conferred by this act shall be used for the
purpose of compelling any natural person to furnish testimony or
evidence that might tend to incriminate him or her or subject him
or her to a penalty; and provided further, that information obtained
pursuant to the powers conferred by this act shall not be made
public or disclosed by the Attorney General, district attorney or
their employees unless otherwise provided under this act .
H. In addition to any other penalties provided under this act,
a charitable organization, professional fundraiser, or professional
solicitor that is found to be in violation of the Oklahoma
Solicitation of Charitable Contributions Act in a civil action or
who willfully violates the terms of any injunction or court order
issued pursuant to the Oklahoma Solicitation of Charitable
Contributions Act shall pay a civil penalty of not more than Ten
Thousand Dollars ($10,000.00) per violation, taking into account the
nature and severity of the violation and the benefit provided to the
public by the violator, along with the need for protecting
contributors and donors . For the purposes of this section, the
district court issuing an injunction shall retain jurisdiction, and
in such cases, the Attorney General, acting in the name of the
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state, or a district attorney may petition for recovery of civil
penalties.
I. In administering and pursuing actions under this act, th e
Attorney General and a district attorney are authorized to sue for
and collect reasonable expenses, attorney fees, and investigation
fees as determined by the court. Civil penalties or contempt
penalties sued for and recovered by the Attorney General or a
district attorney shall be used for the furtherance of their duties
and activities under this act.
J. In addition to other penalties imposed by this act, any
person convicted in a criminal proceeding of committing an act
prohibited in paragraph 1, 3 or 5 of subsection A of this section,
shall be guilty of a felony and upon conviction thereof shall be
subject to a fine not to exceed Ten Thousand Dollars ($10,000.00) or
imprisonment in the custody of the Department of Corrections for not
more than five (5) years, or by both such fine and imprisonment.
SECTION 4. This act shall become effective November 1, 2021.
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Passed the House of Representatives the 11th day of March, 2021.
Presiding Officer of the House
of Representatives
Passed the Senate the ___ day of __________, 2021.
Presiding Officer of the Senate