HOUSE BILL No. 5568


     February 11, 1998, Introduced by Reps. Law and Griffin and referred to the Committee on Regulatory Affairs.


        A bill to amend 1975 PA 169, entitled

   "Charitable organizations and solicitations act,"

   by amending the title and sections 2, 3, 4, 5, 6, 7, 8, 9, 10,

   11, 12, 13, 16, 17, 18, 20, 21, and 23 (MCL 400.272, 400.273,

   400.274, 400.275, 400.276, 400.277, 400.278, 400.279, 400.280,

   400.281, 400.282, 400.283, 400.286, 400.287, 400.288, 400.290,

   400.291, and 400.293), section 13 as amended by 1992 PA 299, and

   by adding sections 3a, 19, 19a, 19b, 19c, 19d, 22a, 23a, and 23b;

   and to repeal acts and parts of acts.

               THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 1                                  TITLE

 2         An act to regulate organizations and persons soliciting or

 3    collecting contributions for charitable purposes; to require

 4    registration  ,  AND disclosure of information  and licensing 

 5    before solicitation of contributions; to provide for reporting of


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 1    financial and other information by those  licensed or  registered

 2    and those claiming exemption; to prescribe standards of conduct

 3    and administration, and to prohibit certain actions; to provide

 4    for enforcement, investigation, and promulgation of rules by the

 5    attorney general; to preempt local regulation; to provide penal-

 6    ties for violations; and to repeal  certain  acts and parts of

 7    acts.

 8         Sec. 2.  As used in this act:

 9         (a) "Charitable organization" means  a benevolent, educa-

10     tional, philanthropic, humane, patriotic, or eleemosynary organi-

11     zation of persons which solicits or obtains contributions solic-

12     ited from the public for charitable purposes.  A chapter, branch,

13     area office, or similar affiliate or person soliciting contribu-

14     tions within the state for a charitable organization which has

15     its principal place of business outside the state is a charitable

16     organization.  This definition does not include duly constituted

17     religious organizations or a group affiliated with and forming an

18     integral part of a religious organization no part of the net

19     income of which inures to the direct benefit of any individual if

20     it has received a declaration of current tax exempt status from

21     the United States.  The affiliated group shall not be required to

22     obtain a declaration if the parent or principal organization has

23     obtained tax exempt status.  Charitable organization does not

24     include a candidate or committee as defined in section 901 of Act

25     No. 116 of the Public Acts of 1954, being section 168.901 of the

26     Michigan Compiled Laws, or a political party qualified to be on

27     the general election ballot pursuant to section 560a of Act



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 1    No. 116 of the Public Acts of 1954, as added, being section

 2     168.560a of the Michigan Compiled Laws.  THE FOLLOWING:

 3         (i) A TAX EXEMPT ORGANIZATION UNDER SECTION 501(c)(3) OF THE

 4    INTERNAL REVENUE CODE OF 1986.

 5         (ii) A PERSON WHOSE PURPOSE, STRUCTURE, OR ACTIVITIES ARE

 6    DESCRIBED UNDER SECTION 501(c)(3) OF THE INTERNAL REVENUE CODE OF

 7    1986.

 8         (iii) CHARITABLE ORGANIZATION DOES NOT INCLUDE A FEDERAL,

 9    STATE, OR LOCAL UNIT OF GOVERNMENT, A SUBDIVISION, AGENCY, OR

10    INSTRUMENTALITY OF FEDERAL, STATE, OR LOCAL GOVERNMENT, OR A

11    RELIGIOUS ORGANIZATION INCORPORATED OR ESTABLISHED FOR RELIGIOUS

12    PURPOSES.

13         (B) "CHARITABLE PURPOSE" MEANS THE FOLLOWING:

14         (i) A PURPOSE DESCRIBED IN SECTION 501(c)(3) OF THE INTERNAL

15    REVENUE CODE OF 1986.

16         (ii) A BENEVOLENT, PHILANTHROPIC, EDUCATIONAL, SCIENTIFIC,

17    PUBLIC HEALTH, HUMANE, RELIGIOUS, OR OTHER ELEEMOSYNARY

18    OBJECTIVE.

19         (C) "CHARITABLE SALES PROMOTION" MEANS AN ADVERTISING OR

20    SALES CAMPAIGN REPRESENTING THAT PROCEEDS FROM THE SALE OR USE OF

21    THE GOODS OR SERVICES OFFERED WILL BENEFIT, IN WHOLE OR IN PART,

22    A CHARITABLE ORGANIZATION OR CHARITABLE PURPOSE, OR THAT THE

23    SELLER OR VENDOR WILL MAKE A PAYMENT TO A CHARITABLE ORGANIZATION

24    OR FOR A CHARITABLE PURPOSE.

25         (D) "COMMERCIAL COVENTURER" MEANS A PERSON WHO CONDUCTS

26    CHARITABLE SALES PROMOTIONS.  A PERSON WHO ENTERS INTO A

27    LICENSING ARRANGEMENT IN WHICH A CHARITABLE ORGANIZATION ALLOWS



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 1    THE PERSON TO USE THE CHARITABLE ORGANIZATION'S NAME FOR A FEE IS

 2    A COMMERCIAL COVENTURER.

 3         (E)  (b)  "Contribution" means the promise, grant, or pay-

 4    ment of money or property of any kind or value, including

 5     promises  THE PROMISE to pay. , except payments by members of an

 6     organization for membership fees, dues, fines, or assessments, or

 7     for services rendered to individual members, if membership in the

 8     organization confers a bona fide right, privilege, professional

 9     standing, honor, or other direct benefit, other than the right to

10     vote, elect officers, or hold offices, and except money or prop-

11     erty received from a governmental authority or foundation

12     restricted as to use.  CONTRIBUTION INCLUDES THAT PORTION OF MEM-

13    BERSHIP FEES, DUES, OR ASSESSMENTS THAT EXCEED THE MONETARY VALUE

14    OF MEMBERSHIP BENEFITS AVAILABLE TO A DUES PAYER WHETHER OR NOT

15    THE MEMBERSHIP BENEFITS ARE USED, AND MEMBERSHIP FEES, DUES, OR

16    ASSESSMENTS THAT ARE PAID PRIMARILY TO SUPPORT THE CHARITABLE

17    ORGANIZATION'S ACTIVITIES AND NOT TO OBTAIN BENEFITS OF MORE THAN

18    NOMINAL MONETARY VALUE.  CONTRIBUTION DOES NOT INCLUDE A GRANT OR

19    CONTRACT FROM ANY GOVERNMENTAL AGENCY OR A RESTRICTED GRANT FROM

20    A FOUNDATION.

21         (F)  (c)  "Person" means an individual, organization, group,

22    association, partnership, corporation, trust, or any combination

23    of them.

24         (G) "PROFESSIONAL FUND-RAISER" MEANS A PERSON, INCLUDING A

25    SUBCONTRACTOR, WHO FOR COMPENSATION OR OTHER CONSIDERATION CON-

26    DUCTS, MANAGES, OR CARRIES ON A DRIVE OR CAMPAIGN TO SOLICIT

27    CONTRIBUTIONS FOR OR ON BEHALF OF A CHARITABLE ORGANIZATION,



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 1    RELIGIOUS ORGANIZATION, OR ANY OTHER PERSON; OR WHO ENGAGES IN

 2    THE BUSINESS OF OR HOLDS HIMSELF OR HERSELF OUT AS INDEPENDENTLY

 3    ENGAGED IN THE BUSINESS OF SOLICITING CONTRIBUTIONS FOR CHARITA-

 4    BLE PURPOSES.  A BONA FIDE OFFICER OR EMPLOYEE OF A CHARITABLE

 5    ORGANIZATION IS NOT A PROFESSIONAL FUND-RAISER.

 6         (H) "SOLICIT" AND "SOLICITATION" MEAN THE FOLLOWING:

 7         (i) A DIRECT OR INDIRECT REQUEST FOR A CONTRIBUTION BASED ON

 8    THE REPRESENTATION THAT THE CONTRIBUTION WILL OR MAY BE USED FOR

 9    A CHARITABLE PURPOSE OR TO BENEFIT A CHARITABLE ORGANIZATION, AND

10    INCLUDES ANY OF THE FOLLOWING METHODS OF SECURING CONTRIBUTIONS:

11         (A) AN ORAL OR WRITTEN REQUEST.

12         (B) DISTRIBUTING, CIRCULATING, MAILING, POSTING, OR PUBLISH-

13    ING A HANDBILL, WRITTEN ADVERTISEMENT, OR OTHER PUBLICATION THAT

14    DIRECTLY OR BY IMPLICATION SEEKS TO OBTAIN A CONTRIBUTION.

15         (C) AN ANNOUNCEMENT TO THE NEWS MEDIA OR BY RADIO, TELEVI-

16    SION, TELEPHONE, TELEGRAPH, FACSIMILE, OR ANY OTHER COMMUNICATION

17    DEVICE, CONCERNING AN APPEAL OR CAMPAIGN FOR A CHARITABLE ORGANI-

18    ZATION OR PURPOSE.

19         (D) THE SALE, ATTEMPTED SALE, OR OFFER TO SELL AN ADVERTISE-

20    MENT, ADVERTISING SPACE, A BOOK, A COUPON, A MAGAZINE, A MEMBER-

21    SHIP, MERCHANDISE, A SUBSCRIPTION, A TICKET, OR OTHER ITEM IN

22    CONNECTION WITH A REQUEST FOR A CHARITABLE ORGANIZATION OR

23    PURPOSE.

24         (E) A RECEPTACLE FOR CONTRIBUTIONS, SUCH AS HONOR BOXES,

25    VENDING MACHINES, WISHING WELLS, OR CONTRIBUTION BOXES, WHERE A

26    CHARITABLE PURPOSE IS USED, REFERRED TO, OR IMPLIED AS AN

27    INDUCEMENT TO MAKE A CONTRIBUTION OR PURCHASE.



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 1         (ii) A SOLICITATION OCCURS WHETHER OR NOT THE PERSON MAKING

 2    THE SOLICITATION RECEIVES A CONTRIBUTION.  FOR PURPOSES OF THIS

 3    ACT, A CHARITABLE ORGANIZATION IS CONSIDERED TO HAVE RECEIVED, IN

 4    ADDITION TO CONTRIBUTIONS SOLICITED FROM THE PUBLIC BY IT, CON-

 5    TRIBUTIONS SOLICITED FROM THE PUBLIC BY ANY OTHER PERSON AND

 6    TRANSFERRED TO THAT CHARITABLE ORGANIZATION.  A CHARITABLE ORGAN-

 7    IZATION THAT RECEIVES AN ALLOCATION FROM A COMMUNITY CHEST,

 8    UNITED FUND, OR SIMILAR ORGANIZATION IS CONSIDERED TO HAVE SOLIC-

 9    ITED THAT ALLOCATION FROM THE PUBLIC.

10         (I)  (d)  "Soliciting material" means printed or similar

11    material, including but not limited to labels, posters, televi-

12    sion scripts, radio scripts, or recordings used in soliciting

13    funds from the public.

14         (J)  (e)  "Solicitor" means a person who solicits on behalf

15    of a charitable organization.

16          (f) "Professional fund raiser" means a person who for com-

17     pensation or other consideration plans, conducts, manages, or

18     carries on a drive or campaign of soliciting contributions for or

19     on behalf of a charitable organization, religious organization,

20     or any other person; or who engages in the business of or holds

21     himself out as independently engaged in the business of solicit-

22     ing contributions for such purposes.  A bona fide officer or

23     employee of a charitable organization is not a professional fund

24     raiser unless his salary or other compensation is computed on the

25     basis of funds to be raised or actually raised.







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 1         (g) "Professional solicitor" means a person who is employed

 2     or retained for compensation by a professional fund raiser to

 3     solicit contributions for charitable purposes.

 4          (h) "Prohibited transaction" is that dealing, activity, con-

 5     duct, administration, or management of the charitable organiza-

 6     tion or by any of its officers, trustees, personnel, or related

 7     persons which may be prohibited as constituting activity contrary

 8     to proper administration of the charitable organization or con-

 9     duct of a fund raising campaign or solicitation by a professional

10     fund raiser or solicitor. 

11         (K) "VENDOR" MEANS A PERSON WHO CONDUCTS CHARITABLE SALES

12    PROMOTIONS THROUGH VENDING MACHINES, HONOR BOXES, NOVELTY

13    MACHINES, OR SIMILAR DEVICES, THAT REPRESENT THAT THEY BENEFIT A

14    CHARITABLE ORGANIZATION OR A CHARITABLE PURPOSE THROUGH A PORTION

15    OF THE PROCEEDS, A FIXED DOLLAR AMOUNT, OR ANY OTHER MANNER.

16         Sec. 3.  (1)  Before a solicitation, a  A charitable organi-

17    zation  which  THAT is not an exempt organization  and which is

18     not  described in section 13  , which  AND THAT solicits or

19    intends to solicit or receives or intends to receive contribu-

20    tions from persons by any means  whatsoever,  shall  file  HAVE A

21    BOARD OF DIRECTORS WITH NOT LESS THAN 2 DIRECTORS AND SHALL

22    REGISTER with the attorney general upon forms prescribed by  him,

23     an application for a license.  It  THE ATTORNEY GENERAL, TOGETHER

24    WITH ALL NECESSARY SUPPORTING DOCUMENTATION.  THE REGISTRATION

25    shall include the following information:







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 1         (a) The name of the organization and  the  ANY name  under

 2     which it intends  USED BY THAT ORGANIZATION to solicit

 3    contributions.

 4         (b) The principal address of the organization and the

 5    address of any office in this state.  If the organization does

 6    not maintain a principal office, the name and address of the

 7    person having custody of its financial records.

 8          (c) The names and addresses of the officers, directors,

 9     trustees, chief executive officer, and state agent. 

10         (C)  (d)  Where and when the organization was legally estab-

11    lished  ,  AND the form of its organization.  , and its tax

12     exempt status. 

13         (D) THE ORGANIZATION'S FEDERAL TAX EXEMPT STATUS AND, WITH

14    ITS INITIAL APPLICATION, A COPY OF ITS INTERNAL REVENUE SERVICE

15    DETERMINATION LETTER.

16         (e)  The  A STATEMENT OF THE ORGANIZATION'S purpose  for

17     which it is organized  and the purposes for which contributions

18    to be solicited will be used.

19         (f)  The fiscal year date of the organization  METHODS BY

20    WHICH SOLICITATIONS WILL BE MADE.

21         (g)  Whether the organization is or has ever been enjoined

22     from soliciting contributions  THE NAMES AND ADDRESSES OF ALL

23    PROFESSIONAL FUND-RAISERS WITH WHOM THE ORGANIZATION HAS

24    CONTRACTED.

25         (h)  All methods by which solicitations will be made  A LIST

26    OF THE NAMES AND ADDRESSES OF THE ORGANIZATION'S BOARD OF

27    DIRECTORS, OFFICERS, AND TRUSTEES.



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 1         (i)  Copies of contracts between charitable organizations

 2     and professional fund raisers relating to financial compensation

 3     or profit to be derived by the professional fund raisers.  When

 4     the contract is executed after filing of application statement, a

 5     copy shall be filed within 10 days of the date of execution.  IF

 6    THE PRINCIPAL ADDRESS OF THE ORGANIZATION IS NOT IN THIS STATE,

 7    THE ADDRESS AND TELEPHONE NUMBER OF A RESIDENT AGENT IN THIS

 8    STATE.

 9         (j)  Other information as required by rule.  WHETHER THE

10    ORGANIZATION OR ANY OF ITS OFFICERS, DIRECTORS, OR PRINCIPALS IS,

11    OR HAS EVER BEEN, ENJOINED, FINED, CONVICTED, OR SUBJECT TO ANY

12    OTHER SANCTION OR PENALTY AS A RESULT OF SOLICITING CONTRIBUTIONS

13    IN ANY STATE OR COUNTRY, OR WHETHER SUCH PROCEEDINGS ARE

14    PENDING.

15         (K) FINANCIAL INFORMATION NECESSARY FOR THE ATTORNEY GENERAL

16    TO PREPARE REPORTS FOR THE LEGISLATURE OR THE PUBLIC IF THE

17    INFORMATION IS NOT INCLUDED IN THE ORGANIZATION'S INTERNAL REVE-

18    NUE SERVICE FORM 990, 990EZ, OR 990PF, OR IF THE ORGANIZATION IS

19    NOT REQUIRED TO FILE AN INTERNAL REVENUE SERVICE FORM 990, 990EZ,

20    OR 990PF PURSUANT TO SUBSECTION (2).

21         (2) THE CHARITABLE ORGANIZATION SHALL PROVIDE THE FOLLOWING

22    DOCUMENTATION WITH ITS REGISTRATION:

23         (A) UNLESS THE ORGANIZATION HAS NOT COMPLETED ITS FIRST

24    ACCOUNTING PERIOD, A COPY OF ITS FULLY AND PROPERLY COMPLETED

25    INTERNAL REVENUE SERVICE FORM 990, 990EZ, OR 990PF FOR THE IMME-

26    DIATELY PRECEDING TAX YEAR, OR SUCCESSOR FORMS, INCLUDING ALL

27    SCHEDULES, ATTACHMENTS, AND EXHIBITS FILED WITH THE INTERNAL



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 1    REVENUE SERVICE, EXCEPT THE SCHEDULE OF CONTRIBUTORS.  EXCEPT AS

 2    OTHERWISE PROVIDED IN THIS SUBSECTION, IF A CHARITABLE ORGANIZA-

 3    TION DOES NOT FILE AN INTERNAL REVENUE SERVICE FORM 990, 990EZ,

 4    OR 990PF, IT SHALL PREPARE A PRO FORMA FORM 990, 990EZ, OR 990PF

 5    RETURN FOR FILING WITH THE REGISTRATION.  A PRO FORMA RETURN

 6    SHALL BE COMPLETED FULLY AND PROPERLY PURSUANT TO INTERNAL REVE-

 7    NUE SERVICE INSTRUCTIONS AND SHALL INCLUDE ALL REQUIRED INFORMA-

 8    TION, ATTACHMENTS, SCHEDULES, AND EXHIBITS.  IF AN ORGANIZATION

 9    IS NOT REQUIRED TO FILE FORM 990EZ WITH THE INTERNAL REVENUE

10    SERVICE BECAUSE OF INSUFFICIENT GROSS RECEIPTS, THAT ORGANIZATION

11    IS NOT REQUIRED TO INCLUDE THAT FORM OR A PRO FORMA RETURN WITH

12    ITS REGISTRATION.

13         (B) FINANCIAL STATEMENTS PREPARED ACCORDING TO GENERALLY

14    ACCEPTED ACCOUNTING PRINCIPLES THAT HAVE BEEN AUDITED BY AN INDE-

15    PENDENT CERTIFIED PUBLIC ACCOUNTANT IF THE AMOUNT OF CONTRIBU-

16    TIONS RECEIVED BY THE CHARITABLE ORGANIZATION DURING ITS FISCAL

17    YEAR REPORTED ON ITS FEDERAL TAX RETURN IS $250,000.00 OR MORE.

18    IF CONTRIBUTIONS AS REPORTED ON THE CHARITABLE ORGANIZATION'S

19    INTERNAL REVENUE SERVICE FORM 990, 990EZ, OR 990PF ARE

20    $100,000.00 OR MORE, BUT LESS THAN $250,000.00, FINANCIAL STATE-

21    MENTS EITHER REVIEWED OR AUDITED BY AN INDEPENDENT CERTIFIED

22    PUBLIC ACCOUNTANT SHALL BE PROVIDED.  THE AMOUNT OF CONTRIBUTIONS

23    RECEIVED BY THE ORGANIZATION INCLUDES DIRECT AND INDIRECT PUBLIC

24    SUPPORT AS SHOWN ON THE INTERNAL REVENUE SERVICE FORM 990, 990EZ,

25    OR 990PF, LESS ANY RESTRICTED GRANTS FROM FOUNDATIONS INCLUDED IN

26    THE FEDERAL TAX RETURN, PLUS NET SPECIAL FUND-RAISING EVENTS





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 1    REVENUE.  THE ATTORNEY GENERAL MAY WAIVE THIS REQUIREMENT 1 TIME

 2    FOR A CHARITABLE ORGANIZATION.

 3         (3) WITH ITS REGISTRATION, OR RENEWAL OF ITS REGISTRATION AS

 4    PROVIDED IN SECTION 7, A CHARITABLE ORGANIZATION SHALL PAY THE

 5    FOLLOWING REGISTRATION FEE:

 6         (A) IF GROSS RECEIPTS FROM ALL SOURCES WERE LESS THAN

 7    $25,000.00 IN THE FISCAL YEAR REPORTED ON THE REGISTRATION, THERE

 8    IS NO FEE.

 9         (B) IF GROSS RECEIPTS FROM ALL SOURCES WERE MORE THAN

10    $25,000.00 BUT LESS THAN $100,000.00 IN THE FISCAL YEAR REPORTED

11    ON THE REGISTRATION, $20.00.

12         (C) IF GROSS RECEIPTS FROM ALL SOURCES WERE AT LEAST

13    $100,000.00 BUT LESS THAN $500,000.00 IN THE FISCAL YEAR REPORTED

14    ON THE REGISTRATION, $50.00.

15         (D) IF GROSS RECEIPTS FROM ALL SOURCES WERE AT LEAST

16    $500,000.00 BUT LESS THAN $1,000.000.00 IN THE FISCAL YEAR

17    REPORTED ON THE REGISTRATION, $100.00.

18         (E) IF GROSS RECEIPTS FROM ALL SOURCES WERE $1,000,000.00 OR

19    MORE IN THE FISCAL YEAR REPORTED ON THE REGISTRATION, $200.00.

20         (4) A CHARITABLE ORGANIZATION'S REGISTRATION IS EFFECTIVE

21    IMMEDIATELY UPON RECEIPT BY THE ATTORNEY GENERAL OF THE INFORMA-

22    TION AND FEES REQUIRED UNDER THIS ACT.

23         SEC. 3A.  (1) THE CHARITABLE ORGANIZATIONS AND SOLICITATIONS

24    FUND IS CREATED WITHIN THE STATE TREASURY.

25         (2) THE STATE TREASURER MAY RECEIVE MONEY OR OTHER ASSETS

26    FOR DEPOSIT INTO THE CHARITABLE ORGANIZATIONS AND SOLICITATIONS

27    FUND FROM ANY OF THE FOLLOWING:



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 1         (A) REGISTRATION FEES COLLECTED UNDER THIS ACT.

 2         (B) LATE REGISTRATION FEES COLLECTED UNDER THIS ACT.

 3         (C) FINES AND PENALTIES ASSESSED AND COLLECTED UNDER THIS

 4    ACT.

 5         (D) ANY OTHER SOURCE.

 6         (3) THE STATE TREASURER SHALL DIRECT THE INVESTMENT OF THE

 7    CHARITABLE ORGANIZATIONS AND SOLICITATIONS FUND AND SHALL CREDIT

 8    TO THE CHARITABLE ORGANIZATIONS AND SOLICITATIONS FUND INTEREST

 9    AND EARNINGS FROM CHARITABLE ORGANIZATIONS AND SOLICITATIONS FUND

10    INVESTMENTS.

11         (4) MONEY IN THE CHARITABLE ORGANIZATIONS AND SOLICITATIONS

12    FUND AT THE CLOSE OF THE FISCAL YEAR SHALL REMAIN IN THE CHARITA-

13    BLE ORGANIZATIONS AND SOLICITATIONS FUND AND SHALL NOT LAPSE TO

14    THE GENERAL FUND.

15         (5) THE DEPARTMENT OF ATTORNEY GENERAL SHALL EXPEND MONEY

16    FROM THE CHARITABLE ORGANIZATIONS AND SOLICITATIONS FUND, UPON

17    APPROPRIATION, ONLY FOR THE ADMINISTRATION OF THIS ACT.

18         Sec. 4.  (1)  True  A TRUE and correct  copies  COPY of  the

19     contracts of  A CONTRACT WITH A professional  fund raisers 

20    FUND-RAISER shall be kept on file in the offices of the charita-

21    ble organization and the professional  fund raiser  FUND-RAISER

22    during the term of  employment  THE CONTRACT and for 6 years

23     subsequent to the date  AFTER the solicitation of contributions

24    provided for  therein  IN THE CONTRACT actually terminates.

25         (2) Copies of A CONTRACT WITH A PROFESSIONAL FUND-RAISER,

26    VENDOR, OR COMMERCIAL COVENTURER AND all soliciting materials





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 1    shall be supplied TO THE ATTORNEY GENERAL upon request.  of the

 2     attorney general. 

 3         (3) A CHARITABLE ORGANIZATION SHALL TAKE REASONABLE STEPS TO

 4    ENSURE THAT A PROFESSIONAL FUND-RAISER WITH WHOM IT HAS CON-

 5    TRACTED TO SOLICIT FUNDS IN THIS STATE IS REGISTERED IN THIS

 6    STATE AS A PROFESSIONAL FUND-RAISER.

 7         Sec. 5.  (1)  An application  THE ATTORNEY GENERAL SHALL

 8    REVIEW A REGISTRATION THAT IS SUBMITTED in proper form  and sup-

 9     ported by material information  TOGETHER WITH THE DOCUMENTATION

10    AND REGISTRATION FEE required  shall be examined by the attorney

11     general  UNDER THIS ACT.  If the  application and  REGISTRATION,

12    supporting  material conforms  DOCUMENTATION, AND REGISTRATION

13    FEE CONFORM to the requirements of this act,  and the rules,  the

14    attorney general shall  issue a license to  REGISTER the charita-

15    ble organization,  within 30 days, except where  PROFESSIONAL

16    FUND-RAISER, OR VENDOR UNLESS the CHARITABLE organization, PRO-

17    FESSIONAL FUND-RAISER, OR VENDOR has  materially  misrepresented

18    or omitted  information  required DOCUMENTATION or the CHARITABLE

19    organization, PROFESSIONAL FUND-RAISER, OR VENDOR has  acted 

20    VIOLATED or is  acting in violation of  VIOLATING this act or

21    rules promulgated  hereunder  UNDER THIS ACT.

22          (2) The license shall be without charge and issued to the

23     charitable organization, its agents and representatives for the

24     purpose of soliciting and receiving contributions and donations

25     or to sell memberships or otherwise raise moneys from the public

26     for the specified charitable purpose. 





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 1         (2)  (3) A license issued to a professional fund raiser,

 2     professional solicitor, or a charitable organization, its agents

 3     and representatives may be suspended or revoked by the  THE

 4    attorney general MAY SUSPEND OR RESCIND THE REGISTRATION OF A

 5    CHARITABLE ORGANIZATION, PROFESSIONAL FUND-RAISER, OR VENDOR AND

 6    AN AGENT OR REPRESENTATIVE OF A CHARITABLE ORGANIZATION, PROFES-

 7    SIONAL FUND-RAISER, OR VENDOR for violation of this act  or rules

 8     promulgated hereunder,  after reasonable notice and opportunity

 9    to be heard.  The attorney general may suspend on an emergency

10    basis, without hearing,  any license issued to a professional

11     fund raiser, professional solicitor, or a charitable organization

12     when  THE REGISTRATION OF A CHARITABLE ORGANIZATION, PROFESSIONAL

13    FUND-RAISER, OR VENDOR IF the attorney general specifies in the

14    notice of emergency suspension the reasons and grounds indicating

15    a violation of this act or  any  A rule  which  PROMULGATED UNDER

16    THIS ACT THAT constitutes the emergency.  The notice shall set

17    forth that within 48 hours, at a designated time and place, a

18    hearing shall be held on whether the  license  REGISTRATION

19    should be permanently suspended or  revoked  RESCINDED.  The

20     professional fund raiser, professional solicitor, or  charitable

21    organization, PROFESSIONAL FUND-RAISER, OR VENDOR may show com-

22    pliance with  the requirements of  this act or the rules

23    PROMULGATED UNDER THIS ACT and  shall have  HAS the burden of

24     adducing the evidence  PROOF IN ESTABLISHING THAT COMPLIANCE.

25         Sec. 6.  A charitable organization, PROFESSIONAL

26    FUND-RAISER, OR VENDOR shall notify the attorney general within

27    30 days of any change in the information required to be furnished



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 1    under  section 3  THIS ACT.  A report shall be filed and signed

 2     by the president or other authorized officer and the chief fiscal

 3     officer of the organization. 

 4         Sec. 7.  (1)  The license of a charitable organization shall

 5     expire 1 year after the date of issuance.  A charitable organiza-

 6     tion desiring renewal of a license shall file with the attorney

 7     general a renewal application and supporting information on or

 8     before 30 days prior to the expiration date.  A REGISTERED CHARI-

 9    TABLE ORGANIZATION SHALL REPORT ON ITS PREVIOUS FISCAL YEAR AND

10    RENEW ITS REGISTRATION WITHIN 6 MONTHS AFTER THE CLOSE OF ITS

11    FISCAL YEAR.  A RENEWAL REGISTRATION AND REPORT SHALL BE ON A

12    FORM PRESCRIBED BY THE ATTORNEY GENERAL AND SHALL INCLUDE THE

13    INFORMATION, SUPPLEMENTAL DOCUMENTATION, AND ANY FEE REQUIRED

14    UNDER THIS ACT.

15         (2) A CHARITABLE ORGANIZATION'S REGISTRATION SHALL EXPIRE IF

16    THE CHARITABLE ORGANIZATION'S RENEWAL REGISTRATION AND REPORT IS

17    NOT RECEIVED WITHIN 18 MONTHS AFTER THE END OF THE FISCAL YEAR

18    REPORTED ON THE ORGANIZATION'S MOST RECENTLY FILED REGISTRATION

19    FORM UNLESS THE ATTORNEY GENERAL HAS EXTENDED THE REGISTRATION

20    UNDER SUBSECTION (4).

21         (3) AN ORGANIZATION PREVIOUSLY REGISTERED UNDER THIS ACT

22    THAT IS NO LONGER SUBJECT TO THE REGISTRATION REQUIREMENTS OF

23    THIS ACT SHALL FILE A FINANCIAL REPORT WITHIN 6 MONTHS OF THE

24    CLOSE OF THE MOST RECENTLY COMPLETED FISCAL YEAR IN WHICH THE

25    ORGANIZATION SOLICITED IN THIS STATE.  THE REPORT SHALL INCLUDE

26    THE FINANCIAL INFORMATION THAT WOULD BE REQUIRED TO RENEW THE

27    ORGANIZATION'S REGISTRATION AND ANY REPORTS ON SOLICITATION



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 1    CAMPAIGNS CONDUCTED BY THE CHARITABLE ORGANIZATION THROUGH A

 2    PROFESSIONAL FUND RAISER AS REQUIRED UNDER SECTION 17(5).  THE

 3    ATTORNEY GENERAL SHALL EXTEND THE PERIOD FOR FILING THE REPORT

 4    REQUIRED UNDER THIS SUBSECTION PURSUANT TO SUBSECTION (4).

 5         (4) IF A CHARITABLE ORGANIZATION RECEIVES AN EXTENSION OF

 6    TIME TO FILE THE CHARITABLE ORGANIZATION'S INTERNAL REVENUE SERV-

 7    ICE FORM 990, 990EZ, OR 990PF, THE ATTORNEY GENERAL SHALL EXTEND

 8    THE CHARITABLE ORGANIZATION'S REGISTRATION FOR A SIMILAR PERIOD

 9    OF TIME.

10         Sec. 8.  (1)  Documents required to be filed with the attor-

11     ney general shall be open to public inspection.  Persons subject

12     to this act shall maintain accurate and detailed books and

13     records at the office of the resident agent or the principal

14     office which shall be open to inspection at all reasonable times

15     by the attorney general or his authorized representative.  A REG-

16    ISTRATION, ANNUAL REPORT, OR OTHER DOCUMENT REQUIRED TO BE FILED

17    UNDER THIS ACT IS A PUBLIC RECORD IN THE OFFICE OF THE ATTORNEY

18    GENERAL OPEN TO INSPECTION.  INVESTIGATIVE DATA OBTAINED BY THE

19    ATTORNEY GENERAL IN ANTICIPATION OF OR IN CONNECTION WITH LITIGA-

20    TION OR AN ADMINISTRATIVE PROCEEDING IS EXEMPT FROM DISCLOSURE

21    UNDER SECTION 13(1)(B) OF THE FREEDOM OF INFORMATION ACT, 1976

22    PA 442, MCL 15.243.

23         (2) A CHARITABLE ORGANIZATION, PROFESSIONAL FUND-RAISER, OR

24    VENDOR SHALL MAINTAIN FOR NOT LESS THAN 3 YEARS FROM THE DATE

25    PREPARED, ACCURATE AND DETAILED RECORDS TO PROVIDE THE INFORMA-

26    TION REQUIRED UNDER THIS ACT.  ALL RECORDS ARE OPEN TO INSPECTION





   00155'97 ***
                                  17

 1    AT ALL REASONABLE TIMES BY THE ATTORNEY GENERAL AND COPIES OF THE

 2    RECORDS SHALL BE PROVIDED TO THE ATTORNEY GENERAL UPON REQUEST.

 3         (3) A CHARITABLE ORGANIZATION OR PERSON, INCLUDING A VENDOR,

 4    COMMERCIAL COVENTURER, PROFESSIONAL FUND-RAISER, OR PERSON

 5    DESCRIBED IN SECTION 23A, THAT SOLICITS CONTRIBUTIONS, RAISES

 6    FUNDS, OR CONDUCTS SALES PROMOTIONS FOR A CHARITABLE PURPOSE

 7    SHALL MAINTAIN AT THE PLACE DESIGNATED IN ITS REGISTRATION OR, IF

 8    NOT A CHARITABLE ORGANIZATION, AT ITS PRINCIPAL PLACE OF BUSI-

 9    NESS, THE ORIGINAL RECORDS OR TRUE COPIES OF THE RECORDS PERTAIN-

10    ING TO ALL MONEY OR OTHER PROPERTY COLLECTED FROM RESIDENTS OF

11    THIS STATE AND TO THE DISBURSEMENT OF THAT MONEY OR PROPERTY.

12    THE RECORDS SHALL BE PRESERVED FOR NOT LESS THAN 3 YEARS FROM THE

13    DATE PREPARED.

14         (4) A FILE IN THE OFFICE OF THE ATTORNEY GENERAL REGARDING A

15    CLOSED ENFORCEMENT ACTION OR A SETTLEMENT IN A CIVIL CASE UNDER

16    THIS ACT IS OPEN TO PUBLIC INSPECTION AND COPYING.  A PROVISION

17    OR REQUIREMENT OF CONFIDENTIALITY OR SEALING OF RECORDS AS A CON-

18    DITION OF SETTLEMENT OF AN ENFORCEMENT OR CIVIL ACTION UNDER THIS

19    ACT IS PROHIBITED.

20         Sec. 9.  If a local, county, or area division of a charita-

21    ble organization is directly supervised and controlled by a

22    superior or parent organization  , which  THAT is incorporated

23     ,  AND qualified to do business IN THIS STATE, or IS doing busi-

24    ness within this state, the local, county, or area division OF

25    THAT CHARITABLE ORGANIZATION is not required to register under

26    section 3 if the superior or parent organization  files an

27     application statement  REGISTERS on behalf of the local, county,



   00155'97 ***
                                  18

 1    or area division in addition to or as part of  its application

 2     statement.  When an application statement has been  THE SUPERIOR

 3    OR PARENT ORGANIZATION'S REGISTRATION.  IF A REGISTRATION IS

 4    filed by a superior or parent organization, it shall file the

 5    annual report required under  sections 14 and 16  THIS ACT on

 6    behalf of the local, county, or area division in  such  THE

 7    detail  as  required by the  rules  ATTORNEY GENERAL.

 8         Sec. 10.  The attorney general may promulgate rules neces-

 9    sary for the administration of this act  in accordance with and

10     subject to Act No. 306 of the Public Acts of 1969, as amended,

11     being sections 24.201 to 24.315 of the Michigan Compiled Laws 

12    UNDER THE ADMINISTRATIVE PROCEDURES ACT OF 1969, 1969 PA 306,

13    MCL 24.201 TO 24.328.  Emergency rules may not be promulgated.

14     pursuant to this act. 

15         Sec. 11.  (1)  An application for a license  THE ATTORNEY

16    GENERAL shall not  be accepted  ACCEPT A REGISTRATION from a

17    charitable organization, PROFESSIONAL FUND-RAISER, OR VENDOR

18    located in another state or country unless  it  THAT CHARITABLE

19    ORGANIZATION, PROFESSIONAL FUND-RAISER, OR VENDOR first desig-

20    nates a resident agent in this state  for the acceptance of  TO

21    ACCEPT process issued by any court.

22         (2) A charitable organization, person, VENDOR, OR profes-

23    sional  fund raiser, or professional solicitor, soliciting con-

24     tributions in this state but not maintaining an office within the

25     state shall be  FUND-RAISER IS subject to service of process as

26    follows:





   00155'97 ***
                                  19

 1         (a) By service on its  registered  RESIDENT agent within

 2     the  THIS state or if there is no  registered  RESIDENT agent,

 3    then upon the person  who has been  designated in the

 4     application statement  REGISTRATION as having custody of books

 5    and records within this state OR UPON AN OFFICER OF THE ORGANIZA-

 6    TION AT ITS PRINCIPAL OFFICE.  When  IF service is effected upon

 7    the person designated in the registration,  statement  a copy of

 8    the process shall be mailed to the charitable organization,

 9    PERSON, VENDOR, OR PROFESSIONAL FUND-RAISER at its last known

10    address.

11         (b)  When a charitable organization has solicited contribu-

12     tions in this state but does not maintain an office within the

13     state, have a registered agent within this state and have a des-

14     ignated person having custody of its books and records within the

15     state, or when a registered agent or person having custody of its

16     books and records within the state cannot be found as shown by

17     the return of the sheriff of the county in which the registered

18     agent or person having custody of books and records has been rep-

19     resented by the charitable organization as maintaining an

20     office,  IF SERVICE CANNOT BE EXECUTED AS PROVIDED BY THIS

21    SECTION, service may be made as otherwise provided by law or

22    court rules.

23         (3) Solicitation of a contribution within this state by any

24    means  ,  is the agreement of the charitable organization,

25    person, VENDOR, OR professional  fund raiser, or professional

26     solicitor,  FUND-RAISER that any SERVICE OF process  against it





   00155'97 ***
                                  20

 1    or him which is  served  in accordance with  UNDER this section

 2    is of the same legal force and effect as if served personally.

 3         Sec. 12.  Upon THE initial filing of  an application state-

 4     ment pursuant to  A REGISTRATION UNDER section 3, the attorney

 5    general may suspend for a reasonable, specifically designated

 6    time the filing of reports otherwise required  by sections 14 and

 7     15  UNDER THIS ACT as to a particular charitable  corporation,

 8     trust, or  organization,  incorporated or established for chari-

 9     table purposes,  upon written application filed with the attorney

10    general, and after the attorney general has determined and acqui-

11    esced by a written statement that the  interest of the  the

12    public INTEREST will not be prejudiced.  thereby. 

13         Sec. 13.  The  licensing and financial statement 

14    REGISTRATION AND REPORTING requirements of this act do not apply

15    to any of the following:

16          (a) A person who requests a contribution for the relief or

17     benefit of an individual, specified by name at the time of the

18     solicitation, if the contributions collected are turned over to

19     the named beneficiary after deducting reasonable expenses for

20     costs of solicitation, if any, and if all fun-raising functions

21     are carried on by persons who are unpaid, directly or indirectly,

22     for their services. 

23         (A)  (b)  A  person who  CHARITABLE ORGANIZATION THAT does

24    not intend to solicit and receive and does not actually receive

25    contributions in excess of  $8,000.00  $25,000.00 during  any

26     12-month period if all of its fund raising functions are carried

27     on by persons who are unpaid for their services and if the



   00155'97 ***
                                  21

 1    organization makes available to its members and the public a

 2     financial statement of its activities for the most recent fiscal

 3  year.  If the gross contributions received during any 12-month

 4     period exceed $8,000.00, the person shall file an application for

 5     license with required supporting information as provided in

 6     section 3 within 30 days after the date it has received total

 7     contributions in excess of $8,000.00.  ITS FISCAL YEAR.  A CHARI-

 8    TABLE ORGANIZATION SHALL REGISTER AS REQUIRED UNDER THIS ACT

 9    WITHIN 30 DAYS AFTER THE DATE THE CHARITABLE ORGANIZATION

10    RECEIVES TOTAL CONTRIBUTIONS OF MORE THAN $25,000.00.  THIS SUB-

11    DIVISION ONLY APPLIES IF ALL OF THE CHARITABLE ORGANIZATION'S

12    FUND-RAISING FUNCTIONS ARE CARRIED ON BY PERSONS WHO ARE NOT PAID

13    FOR THEIR SERVICES.

14         (B)  (c) An organization that does not invite the general

15     public to become a member of the organization and confines solic-

16     itation activities to solicitation drives solely among its mem-

17     bers and the members' immediate families, if the drives are not

18     held more frequently than quarterly.  "Immediate family" means

19     the grandparents, parents, spouse, brothers, sisters, children,

20     and grandchildren.  A PRIVATE FOUNDATION AS THAT TERM IS DEFINED

21    IN SECTION 509(a) OF THE INTERNAL REVENUE CODE THAT DID NOT

22    RECEIVE CONTRIBUTIONS FROM MORE THAN 25 PERSONS DURING THE MOST

23    RECENT FISCAL YEAR.

24          (d) An educational institution certified by the state board

25     of education.

26          (e) A veterans' organization incorporated under federal

27     law.



   00155'97 ***
                                  22

 1         (f) An organization that receives funds from a charitable

 2     organization licensed under this act that does not solicit or

 3     intend to solicit or receive or intend to receive contributions

 4     from persons other than a charitable organization, if the organi-

 5     zation makes available to its members and the public a financial

 6     statement of its activities for the most recent fiscal year.

 7          (g) A licensed hospital, hospital based foundation, and hos-

 8     pital auxiliary that solicit funds solely for 1 or more licensed

 9     hospitals.

10          (h) A nonprofit service organization that is exempt from

11     taxation pursuant to a provision of the United States internal

12     revenue code other than section 501(c)(3), whose principal pur-

13     pose is not charitable, but solicits from time to time funds for

14     a charitable purpose by members of the organization who are not

15     paid for the solicitation.  The funds shall be wholly used for

16     the charitable purposes for which they were solicited, and the

17     organization shall file with the attorney general a federal form

18     990 or 990 AR.

19          (i) A nonprofit corporation whose stock is wholly owned by a

20     religious or fraternal society that owns and operates facilities

21     for the aged and chronically ill in which no part of the net

22     income from the operation of the corporation inures to the bene-

23     fit of a person other than the residents.

24          (j) Charitable organizations licensed by the department of

25     social services that serve children and families. 







   00155'97 ***
                                  23

 1         (C)  (k)  A person registered under and complying with the

 2    requirements of the public safety solicitation act, 1992 PA 298,

 3    MCL 14.301 TO 14.327.

 4         Sec. 16.  The attorney general may CONDITIONALLY continue

 5     under conditions  the  license  REGISTRATION of  an  A

 6    CHARITABLE organization, professional  fund raiser, or profes-

 7     sional solicitor which  FUND-RAISER, OR VENDOR THAT fails to

 8    comply with this act  including failure to comply with the rules

 9     regarding prohibited transactions, standards of solicitation,

10     conduct, or administration  OR RULES PROMULGATED UNDER THIS ACT.

11         Sec. 17.  (1)  A person shall not act as a professional fund

12     raiser for a charitable organization or charitable purpose before

13     he has filed an application for a license with the attorney gen-

14     eral or after the expiration or cancellation of a license or

15     renewal thereof.  Applications for license shall be in writing,

16     under oath, in the form prescribed by the attorney general.  The

17     applicant when making application, shall file with and have

18     approved by the attorney general a bond in which the applicant

19     shall be the principal obligor, in the sum of $10,000.00.  The

20     bond shall run to the people of the state and to any person

21     including charitable organizations who may have a cause of action

22     against the obligor of the bond for any malfeasance or misfeas-

23     ance in the conduct of the solicitation.  The aggregate limit of

24     liability of the surety to the state and to all the persons shall

25     not exceed the sum of the bond.  Application for renewal of

26     licenses when effected shall be for a period of 1 year, or a part

27     thereof, expiring on June 30, and may be renewed for additional



   00155'97 ***
                                  24

 1    1-year periods upon written application, under oath, in the form

 2     prescribed by the attorney general and the filing of the bond.  A

 3    PROFESSIONAL FUND-RAISER SHALL NOT SOLICIT OR RECEIVE DONATIONS

 4    FOR A CHARITABLE PURPOSE OR ON BEHALF OF A CHARITABLE ORGANIZA-

 5    TION OR RELIGIOUS ORGANIZATION, BEFORE REGISTERING WITH THE

 6    ATTORNEY GENERAL OR AFTER THE EXPIRATION, SUSPENSION, REVOCATION,

 7    OR DENIAL OF A REGISTRATION.

 8         (2)  A person shall not act as a professional solicitor in

 9     the employ of a professional fund raiser required to be licensed

10     before he has registered with the attorney general or after the

11     expiration or cancellation of registration.  Application for  THE

12    registration  or reregistration  OF A PROFESSIONAL FUND-RAISER

13    shall be in writing  , under oath, in the  ON A form prescribed

14    by the attorney general  .  Registration or reregistration when

15     effected shall be for a period of 1 year, or a part thereof,

16     expiring on June 30, and may be renewed upon written application,

17     under oath, in the form prescribed by the attorney general for

18     additional 1-year periods.  AND SHALL BE ACCOMPANIED BY A PAYMENT

19    OF A $200.00 FEE.  INFORMATION PROVIDED TO THE ATTORNEY GENERAL

20    ON THE REGISTRATION FORM SHALL INCLUDE ALL OF THE FOLLOWING:

21         (A) ALL NAMES CURRENTLY USED BY THE PROFESSIONAL

22    FUND-RAISER.

23         (B) THE ADDRESS AND TELEPHONE NUMBER OF THE PRINCIPAL OFFICE

24    OF THE PROFESSIONAL FUND-RAISER AND OF EACH OFFICE IT MAINTAINS

25    IN THIS STATE.







   00155'97 ***
                                  25

 1         (C) IF THE PRINCIPAL ADDRESS OF THE PROFESSIONAL FUND-RAISER

 2    IS NOT IN THIS STATE, THE ADDRESS AND TELEPHONE NUMBER OF A

 3    RESIDENT AGENT IN THIS STATE.

 4         (D) WHERE AND WHEN THE PROFESSIONAL FUND-RAISER WAS LEGALLY

 5    ESTABLISHED AND THE FORM OF ITS ORGANIZATION.  IF A PROFESSIONAL

 6    FUND-RAISER IS INCORPORATED, THE NAME AND BUSINESS OR HOME

 7    ADDRESS OF ALL OFFICERS AND DIRECTORS.  IF A PROFESSIONAL

 8    FUND-RAISER IS A SOLE PROPRIETORSHIP OR PARTNERSHIP, THE NAME AND

 9    BUSINESS OR HOME ADDRESS OF THE OWNER AND ALL PARTNERS.

10         (E) THE NAME, ADDRESS, AND TELEPHONE NUMBER OF ANYONE WITH

11    DIRECT RESPONSIBILITY FOR SOLICITATION ACTIVITY IN THIS STATE.

12         (F) WHETHER THE PROFESSIONAL FUND-RAISER OR ANY OF ITS OFFI-

13    CERS, DIRECTORS, OR PRINCIPALS IS, OR HAS EVER BEEN, ENJOINED,

14    FINED, CONVICTED, OR SUBJECT TO ANY OTHER SANCTION OR PENALTY AS

15    A RESULT OF SOLICITING CONTRIBUTIONS IN ANY STATE OR COUNTRY.

16         (G) A CONCISE DESCRIPTION OF THE PRINCIPAL METHODS BY WHICH

17    THE PROFESSIONAL FUND-RAISER IS, OR WILL BE, SOLICITING

18    CONTRIBUTIONS.

19         (H) THE NAME, ADDRESS, AND TELEPHONE NUMBER OF ANY CHARITA-

20    BLE ORGANIZATION WITH WHICH THE PROFESSIONAL FUND-RAISER IS UNDER

21    CONTRACT TO SOLICIT FUNDS IN THIS STATE.

22         (I) A COMPLETE COPY OF ANY AGREEMENT BETWEEN THE PROFES-

23    SIONAL FUND-RAISER AND A CHARITABLE ORGANIZATION.

24         (J) A COMPLETE COPY OF ANY SUBCONTRACT AGREEMENT BETWEEN THE

25    PROFESSIONAL FUND-RAISER AND A PERSON THAT WILL ACT AS A PROFES-

26    SIONAL FUND-RAISER ON BEHALF OF A CHARITABLE ORGANIZATION,





   00155'97 ***
                                  26

 1    RELIGIOUS ORGANIZATION, OR ANY OTHER PERSON SOLICITING FOR A

 2    CHARITABLE PURPOSE.

 3         (3) EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION (4), THE REG-

 4    ISTRATION OF A PROFESSIONAL FUND-RAISER THAT RECEIVES, HAS CUS-

 5    TODY OF, OR ACCESS TO FUNDS SOLICITED IN THIS STATE FOR A CHARI-

 6    TABLE ORGANIZATION SHALL BE ACCOMPANIED BY A $25,000.00 BOND, IN

 7    WHICH THE PROFESSIONAL FUND-RAISER IS THE PRINCIPAL OBLIGOR.  THE

 8    BOND SHALL RUN TO THE PEOPLE OF THIS STATE AND TO ANY PERSON,

 9    INCLUDING CHARITABLE ORGANIZATIONS, THAT MAY HAVE A CAUSE OF

10    ACTION AGAINST THE PROFESSIONAL FUND-RAISER AS A RESULT OF THE

11    PROFESSIONAL FUND-RAISER'S CONDUCT OF ANY ACTIVITY SUBJECT TO

12    THIS ACT.  THE BOND SHALL BE OBTAINED AND SUBMITTED ON A FORM

13    PRESCRIBED BY THE ATTORNEY GENERAL.  THE BOND SHALL BE ISSUED BY

14    A COMPANY AUTHORIZED TO ENGAGE IN INSURANCE ACTIVITY IN THIS

15    STATE.  THE BOND SHALL REMAIN IN EFFECT FOR A PERIOD OF AT LEAST

16    1 YEAR AFTER THE PROFESSIONAL FUND-RAISER'S REGISTRATION

17    EXPIRES.

18         (4) THE ATTORNEY GENERAL MAY ACCEPT AN IRREVOCABLE LETTER OF

19    CREDIT IN LIEU OF A BOND.  AN IRREVOCABLE LETTER OF CREDIT SHALL

20    BE ISSUED BY A FINANCIAL INSTITUTION THAT IS AUTHORIZED TO TRANS-

21    ACT BUSINESS IN THIS STATE AND THAT IS INSURED BY THE FEDERAL

22    DEPOSIT INSURANCE CORPORATION, THE FEDERAL SAVINGS AND LOAN

23    INSURANCE CORPORATION, OR THE NATIONAL CREDIT UNION ASSOCIATION.

24    AN IRREVOCABLE LETTER OF CREDIT SHALL BE SUBMITTED ON A FORM PRE-

25    SCRIBED BY THE ATTORNEY GENERAL AND SHALL EXPIRE NOT LESS THAN 1

26    YEAR AFTER THE PROFESSIONAL FUND-RAISER'S REGISTRATION EXPIRES.





   00155'97 ***
                                  27

 1         (5) WITHIN 90 DAYS AFTER A SOLICITATION CAMPAIGN IS

 2    COMPLETED, OR ON THE ANNIVERSARY OF THE COMMENCEMENT OF A

 3    SOLICITATION CAMPAIGN LASTING MORE THAN 1 YEAR, A PROFESSIONAL

 4    FUND-RAISER THAT SOLICITED CONTRIBUTIONS IN THIS STATE IN CON-

 5    JUNCTION WITH A CHARITABLE ORGANIZATION SHALL FILE WITH THE

 6    ATTORNEY GENERAL A FINANCIAL REPORT FOR THE CAMPAIGN, INCLUDING

 7    GROSS REVENUE AND AN ITEMIZATION OF ALL EXPENSES INCURRED ON

 8    BEHALF OF THE CHARITABLE ORGANIZATION.  THE REPORT SHALL BE SUB-

 9    MITTED ON A FORM PRESCRIBED BY THE ATTORNEY GENERAL.  THE REPORT

10    SHALL BE SIGNED BY AN AUTHORIZED OFFICIAL OF THE PROFESSIONAL

11    FUND-RAISER AND AN AUTHORIZED OFFICIAL OF THE CHARITABLE ORGANI-

12    ZATION, WHO SHALL CERTIFY, UNDER OATH, THAT THE REPORT IS TRUE TO

13    THE BEST OF HIS OR HER KNOWLEDGE.

14         (6) A PROFESSIONAL FUND-RAISER'S REGISTRATION IS EFFECTIVE

15    IMMEDIATELY UPON RECEIPT BY THE ATTORNEY GENERAL OF THE INFORMA-

16    TION AND FEES REQUIRED UNDER THIS ACT.  THE REGISTRATION SHALL

17    EXPIRE 1 YEAR AFTER THE REGISTRATION IS EFFECTIVE.  A PROFES-

18    SIONAL FUND-RAISER'S REGISTRATION IS RENEWABLE BY FILING A

19    RENEWAL REGISTRATION AND PAYING A $200.00 FEE.

20         Sec. 18.  (1)  A person shall not use for the purpose of

21     soliciting contributions the name of another person, except that

22     of an officer, director, or trustee of the charitable organiza-

23     tion by or for which contributions are solicited, without the

24     consent of such other person.  A CHARITABLE ORGANIZATION, PROFES-

25    SIONAL FUND-RAISER, COMMERCIAL COVENTURER, VENDOR, PERSON

26    DESCRIBED IN SECTION 23A, OR AN EMPLOYEE OR AGENT OF A CHARITABLE

27    ORGANIZATION, PROFESSIONAL FUND-RAISER, COMMERCIAL COVENTURER,



   00155'97 ***
                                  28

 1    VENDOR, OR PERSON DESCRIBED IN SECTION 23A SHALL NOT ENGAGE IN

 2    ANY OF THE FOLLOWING:

 3         (A) A METHOD, ACT, OR PRACTICE IN VIOLATION OF THIS ACT OR A

 4    RULE PROMULGATED UNDER THIS ACT, ANY RESTRICTION, CONDITION, OR

 5    LIMITATION PLACED ON A REGISTRATION, OR A FINAL ORDER OR CEASE

 6    AND DESIST ORDER.

 7         (B) REPRESENTING OR IMPLYING THAT A PERSON SOLICITING CON-

 8    TRIBUTIONS OR OTHER FUNDS FOR A CHARITABLE ORGANIZATION HAS A

 9    SPONSORSHIP, APPROVAL, STATUS, AFFILIATION, OR OTHER CONNECTION

10    WITH A CHARITABLE ORGANIZATION OR CHARITABLE PURPOSE THAT THE

11    PERSON DOES NOT HAVE.

12         (C) REPRESENTING OR IMPLYING THAT A CONTRIBUTION IS FOR OR

13    ON BEHALF OF A CHARITABLE ORGANIZATION, OR USING AN EMBLEM,

14    DEVICE, OR PRINTED MATERIAL BELONGING TO OR ASSOCIATED WITH A

15    CHARITABLE ORGANIZATION, WITHOUT FIRST OBTAINING WRITTEN AUTHORI-

16    ZATION FROM THAT CHARITABLE ORGANIZATION.

17         (D) USING A NAME, SYMBOL, OR STATEMENT SO CLOSELY RELATED OR

18    SIMILAR TO A NAME, SYMBOL, OR STATEMENT USED BY ANOTHER CHARITA-

19    BLE ORGANIZATION THAT USE OF THAT NAME, SYMBOL, OR STATEMENT

20    WOULD TEND TO CONFUSE OR MISLEAD A SOLICITED PERSON.

21         (E) USING A BOGUS, FICTITIOUS, OR NONEXISTENT ORGANIZATION,

22    ADDRESS, OR TELEPHONE NUMBER IN ANY SOLICITATION.

23         (F) MISREPRESENTING OR MISLEADING ANY PERSON IN ANY MANNER

24    TO BELIEVE THAT A PERSON ON WHOSE BEHALF A SOLICITATION EFFORT IS

25    CONDUCTED IS A CHARITABLE ORGANIZATION OR THAT THE PROCEEDS OF A

26    SOLICITATION EFFORT ARE FOR CHARITABLE PURPOSES.





   00155'97 ***
                                  29

 1         (G) MISREPRESENTING OR MISLEADING ANY PERSON IN ANY MANNER

 2    TO BELIEVE THAT A PERSON SPONSORS, ENDORSES, OR APPROVES A

 3    SOLICITATION EFFORT IF THAT PERSON HAS NOT GIVEN WRITTEN CONSENT

 4    TO THE USE OF HIS OR HER NAME FOR THAT PURPOSE.

 5         (H) MISREPRESENTING OR MISLEADING ANY PERSON IN ANY MANNER

 6    TO BELIEVE THAT REGISTRATION UNDER THIS ACT CONSTITUTES ENDORSE-

 7    MENT OR APPROVAL BY THIS STATE OR A DEPARTMENT OR AGENCY OF THIS

 8    STATE.

 9         (I) REPRESENTING OR IMPLYING THAT THE AMOUNT OR PERCENTAGE

10    OF A CONTRIBUTION THAT A CHARITABLE ORGANIZATION WILL RECEIVE FOR

11    A CHARITABLE PROGRAM AFTER COSTS OF SOLICITATION ARE PAID IS

12    GREATER THAN THE AMOUNT OR PERCENTAGE OF A CONTRIBUTION THE CHAR-

13    ITABLE ORGANIZATION WILL ACTUALLY RECEIVE.

14         (J) DIVERTING OR MISDIRECTING CONTRIBUTIONS TO A PURPOSE OR

15    ORGANIZATION OTHER THAN THAT FOR WHICH THE FUNDS WERE CONTRIBUTED

16    OR SOLICITED.

17         (K) FALSELY REPRESENTING OR IMPLYING THAT DONORS WILL

18    RECEIVE SPECIAL BENEFITS OR TREATMENT OR THAT FAILURE TO MAKE A

19    CONTRIBUTION WILL RESULT IN UNFAVORABLE TREATMENT.

20         (l) MISREPRESENTING OR MISLEADING ANY PERSON IN ANY MANNER

21    TO BELIEVE THAT A CONTRIBUTION IS ELIGIBLE FOR TAX ADVANTAGES

22    UNLESS THAT PERSON QUALIFIES FOR THOSE TAX ADVANTAGES AND ALL

23    DISCLOSURES REQUIRED BY LAW ARE MADE.

24         (M) FALSELY REPRESENTING OR IMPLYING THAT THE PERSON BEING

25    SOLICITED OR A FAMILY MEMBER OR ASSOCIATE OF THE PERSON BEING

26    SOLICITED HAS PREVIOUSLY MADE OR AGREED TO MAKE A CONTRIBUTION.





   00155'97 ***
                                  30

 1         (N) EMPLOYING ANY DEVICE, SCHEME, OR ARTIFICE TO DEFRAUD OR

 2    OBTAIN MONEY OR PROPERTY FROM A PERSON BY MEANS OF A FALSE,

 3    DECEPTIVE, OR MISLEADING PRETENSE, REPRESENTATION, OR PROMISE.

 4         (O) REPRESENTING THAT FUNDS SOLICITED WILL BE USED FOR A

 5    PARTICULAR CHARITABLE PURPOSE IF THOSE FUNDS ARE NOT USED FOR THE

 6    REPRESENTED PURPOSE.

 7         (P) SOLICITING CONTRIBUTIONS, CONDUCTING A SALES PROMOTION,

 8    OR OTHERWISE OPERATING IN THIS STATE AS A CHARITABLE ORGANIZA-

 9    TION, PROFESSIONAL FUND-RAISER, OR VENDOR UNLESS THE INFORMATION

10    REQUIRED UNDER THIS ACT IS FILED WITH THE ATTORNEY GENERAL AS

11    REQUIRED UNDER THIS ACT.

12         (Q) AIDING, ABETTING, OR OTHERWISE PERMITTING A PERSON TO

13    SOLICIT CONTRIBUTIONS OR CONDUCT A SALES PROMOTION IN THIS STATE

14    UNLESS THE PERSON SOLICITING CONTRIBUTIONS OR CONDUCTING THE

15    SALES PROMOTION HAS COMPLIED WITH THE REQUIREMENTS OF THIS ACT.

16         (R) FAILING TO FILE THE INFORMATION AND REPORTS REQUIRED

17    UNDER THIS ACT OR FAILING TO PROVIDE ANY INFORMATION REQUESTED BY

18    THE ATTORNEY GENERAL IN A TIMELY MANNER.

19         (S) FAILING TO REMOVE A PERSON'S NAME FROM ANY DONOR OR MAIL

20    LIST UTILIZED BY A CHARITABLE ORGANIZATION OR PROFESSIONAL

21    FUND-RAISER FOR SOLICITATION PURPOSES IF THAT PERSON REQUESTS

22    THAT HIS OR HER NAME BE REMOVED FROM THAT LIST.

23         (2)  A person has used the name of another person for the

24  purpose of soliciting contributions if the latter person's name

25     is listed on stationery, an advertisement, brochure, or in corre-

26     spondence by which a contribution is solicited by or on behalf of

27     a charitable organization or the name is listed or referred to in



   00155'97 ***
                                  31

 1    connection with a request for a contribution as one who has

 2     contributed to, sponsored, or indorsed the organization or its

 3     activities.  IN ADDITION TO THE PENALTIES PROVIDED IN SECTION 20,

 4    A PERSON WHO ENGAGES IN ANY UNFAIR, UNCONSCIONABLE, OR DECEPTIVE

 5    METHOD, ACT, OR PRACTICE IN A SOLICITATION FOR CONTRIBUTIONS IN

 6    VIOLATION OF THIS ACT OR RULES PROMULGATED UNDER THIS ACT HAS

 7    ENGAGED IN A PROHIBITED ACT IN VIOLATION OF THE MICHIGAN CONSUMER

 8    PROTECTION ACT, 1976 PA 331, MCL 445.901 TO 445.922, AND IS

 9    SUBJECT TO THE PENALTIES AND REMEDIES PROVIDED IN THE MICHIGAN

10    CONSUMER PROTECTION ACT, 1976 PA 331, MCL 445.901 TO 445.922.

11         (3) This section does not prevent the publication of names

12    of contributors without their written consent in an annual or

13    other periodic report issued by a charitable organization for the

14    purpose of reporting on its operations and affairs to its member-

15    ship or for the purpose of reporting contributions to

16    contributors.

17          (4) A charitable organization or professional fund raiser

18     soliciting contributions shall not use a name, symbol, or state-

19     ment so closely related or similar to that used by another chari-

20     table organization or governmental agency that would tend to con-

21     fuse or mislead the public. 

22         (4)  (5)  A charitable organization, whether exempt or not

23    from this act, shall supply to each solicitor and each solicitor

24    shall have in immediate possession identification  which  THAT

25    sets forth the name of the solicitor and the name of the charita-

26    ble organization on whose behalf the solicitation is conducted.





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 1         SEC. 19.  (1) BEFORE CONDUCTING A SALES CAMPAIGN, A VENDOR

 2    SHALL REGISTER WITH THE ATTORNEY GENERAL ON A FORM PRESCRIBED BY

 3    THE ATTORNEY GENERAL.  THE REGISTRATION SHALL INCLUDE, BUT IS NOT

 4    LIMITED TO, THE FOLLOWING INFORMATION:

 5         (A) THE NAME OF THE VENDOR AND ANY OTHER CORPORATE, BUSI-

 6    NESS, OR TRADE NAMES USED BY THE VENDOR.

 7         (B) THE ADDRESS AND TELEPHONE NUMBER OF THE PRINCIPAL OFFICE

 8    OF THE VENDOR.

 9         (C) IF THE VENDOR IS NOT A SOLE PROPRIETORSHIP, WHERE AND

10    WHEN THE VENDOR WAS LEGALLY ESTABLISHED AND THE FORM OF ITS

11    ORGANIZATION.

12         (D) A CONCISE DESCRIPTION OF THE PRINCIPAL METHODS BY WHICH

13    THE VENDOR INTENDS TO CONDUCT ITS SALES OR SOLICITATION CAMPAIGN

14    IN MICHIGAN.

15         (E) THE NAME, ADDRESS, AND TELEPHONE NUMBER OF EACH CHARITA-

16    BLE ORGANIZATION WITH WHICH THE VENDOR HAS CONTRACTED.

17         (F) A COMPLETE COPY OF ANY AGREEMENT BETWEEN THE VENDOR AND

18    A CHARITABLE ORGANIZATION.

19         (2) A VENDOR SHALL PAY A FEE OF $50.00 WITH ITS

20    REGISTRATION.

21         (3) A VENDOR'S REGISTRATION IS EFFECTIVE IMMEDIATELY UPON

22    THE ATTORNEY GENERAL'S RECEIPT OF THE INFORMATION AND FEES

23    REQUIRED UNDER THIS ACT.

24         (4) A VENDOR'S REGISTRATION SHALL EXPIRE 1 YEAR AFTER ITS

25    REGISTRATION IS EFFECTIVE.







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 1         (5) A VENDOR SHALL NOT CONDUCT A CHARITABLE SALES PROMOTION

 2    IN WHICH IT USES THE NAME OF A CHARITABLE ORGANIZATION THAT IS

 3    NOT REGISTERED IN THIS STATE.

 4         SEC. 19A.  A VENDOR SHALL REPORT TO THE ATTORNEY GENERAL THE

 5    TOTAL DOLLAR SALES OF EACH CAMPAIGN CONDUCTED IN THIS STATE AND

 6    THE AMOUNT PAID TO EACH CHARITABLE ORGANIZATION WITH ITS RENEWAL

 7    REGISTRATION OR WITHIN 30 DAYS AFTER THE CONCLUSION OF A SALES

 8    CAMPAIGN IN THIS STATE IF NO FURTHER CAMPAIGN IS INTENDED.

 9         SEC. 19B.  A VENDOR SHALL PROMINENTLY DISPLAY THE FOLLOWING

10    INFORMATION ON EACH VENDING MACHINE, HONOR BOX, NOVELTY MACHINE,

11    OR SIMILAR DEVICE THROUGH WHICH THAT VENDOR CONDUCTS A CHARITABLE

12    SALES PROMOTION:

13         (A) THE NAME OF THE VENDOR AND THE FACT THAT THE VENDOR OWNS

14    THE VENDING MACHINE, HONOR BOX, NOVELTY MACHINE, OR SIMILAR

15    DEVICE.

16         (B) THE PERCENTAGE OF SALES, IF ANY, THAT A CHARITABLE

17    ORGANIZATION WILL RECEIVE.

18         (C) THE AMOUNT THAT A CHARITABLE ORGANIZATION WILL RECEIVE

19    REGARDLESS OF SALES, IF ANY.

20         SEC. 19C.  (1) BEFORE MAKING AN ORAL REQUEST FOR A CONTRIBU-

21    TION AND CONTEMPORANEOUSLY WITH A WRITTEN REQUEST FOR A CONTRIBU-

22    TION, THE CHARITABLE ORGANIZATION, PROFESSIONAL FUND-RAISER, OR

23    VENDOR SOLICITING THE CONTRIBUTION SHALL DISCLOSE THE NAME AND

24    LOCATION BY CITY AND STATE OF EACH CHARITABLE ORGANIZATION ON

25    BEHALF OF WHICH THE SOLICITATION IS MADE.  IF A SOLICITATION IS

26    MADE BY DIRECT PERSONAL CONTACT, THE INFORMATION REQUIRED UNDER

27    THIS SECTION SHALL ALSO BE DISCLOSED PROMINENTLY ON ANY WRITTEN



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 1    DOCUMENT EXHIBITED TO THE PERSON SOLICITED.  IF A SOLICITATION IS

 2    MADE BY RADIO, TELEVISION, LETTER, TELEPHONE, OR ANY OTHER MEANS

 3    NOT INVOLVING PERSONAL CONTACT, THE INFORMATION REQUIRED UNDER

 4    THIS SECTION SHALL BE DISCLOSED PROMINENTLY IN THE SOLICITATION.

 5    THE INFORMATION REQUIRED UNDER THIS SECTION SHALL ALSO BE DIS-

 6    CLOSED PROMINENTLY ON ANY INVOICES, BILLS, FULFILLMENT REQUESTS,

 7    LETTERS, PAMPHLETS, OR BROCHURES USED TO OBTAIN PAYMENT OF A

 8    PLEDGE OR PROMISE TO MAKE A CONTRIBUTION.

 9         (2) IN ADDITION TO THE INFORMATION REQUIRED UNDER SUBSECTION

10    (1), A PROFESSIONAL FUND-RAISER THAT ORALLY SOLICITS CONTRIBU-

11    TIONS IN THIS STATE SHALL ALSO DISCLOSE THE PROFESSIONAL

12    FUND-RAISER'S NAME AS FILED WITH THE ATTORNEY GENERAL AND A

13    STATEMENT THAT THE SOLICITATION IS BEING CONDUCTED BY A PROFES-

14    SIONAL FUND-RAISER.  THE INFORMATION REQUIRED UNDER THIS SUBSEC-

15    TION SHALL BE PROVIDED IN THE SAME MANNER AS THE INFORMATION

16    REQUIRED UNDER SUBSECTION (1).

17         SEC. 19D.  A PERSON REQUIRED TO REGISTER UNDER THIS ACT IS

18    SUBJECT TO A LATE FEE OF $1.00 PER DAY UP TO A MAXIMUM LATE FEE

19    OF $100.00 IF ANY OF THE FOLLOWING OCCUR:

20         (A) A CHARITABLE ORGANIZATION FAILS TO FILE A REPORT ON OR

21    BEFORE THE DATE ITS REGISTRATION EXPIRES AS PROVIDED IN SECTION

22    7(1) UNLESS AN EXTENSION HAS BEEN GRANTED UNDER SECTION 7(4).

23         (B) A PROFESSIONAL FUND-RAISER FAILS TO FILE A REPORT AS

24    REQUIRED UNDER SECTION 17(5).

25         (C) A VENDOR FAILS TO FILE A CAMPAIGN FINANCIAL REPORT OR

26    CAMPAIGN SALES REPORT AS REQUIRED UNDER SECTION 19A.





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 1         (D) A CHARITABLE ORGANIZATION, PROFESSIONAL FUND-RAISER, OR

 2    VENDOR FAILS TO CURE A DEFECT IN ITS REGISTRATION OR ANNUAL

 3    REPORT WITHIN 30 DAYS AFTER NOTICE BY THE ATTORNEY GENERAL THAT A

 4    CORRECTION OR ADDITIONAL INFORMATION IS REQUIRED.

 5         Sec. 20.  (1) The attorney general may,  institute  IN ADDI-

 6    TION TO ANY OTHER ACTION AUTHORIZED BY LAW, BRING an action  in

 7     any circuit court  to enjoin  preliminarily or permanently a

 8     charitable organization, professional fund raiser, solicitor, or

 9     other person who:  (a) Engages in a method, act, or practice in

10     violation of this act or any of the rules promulgated hereunder.

11     (b) Employs or uses in a solicitation or collection of contribu-

12     tions for a charitable organization on behalf of any other person

13     for a charitable purpose a device, scheme, or artifice to

14     defraud, or for obtaining money or property by means of any false

15     pretense, deception, representation, or promise.  AN ACT OR PRAC-

16    TICE PROHIBITED UNDER THIS ACT.  AFTER FINDING THAT A PERSON HAS

17    ENGAGED IN OR IS ENGAGING IN A PROHIBITED ACT OR PRACTICE, A

18    COURT MAY ENTER ANY NECESSARY ORDER OR JUDGMENT, INCLUDING, BUT

19    NOT LIMITED TO, AN INJUNCTION, AN ORDER OF RESTITUTION, AN AWARD

20    OF REASONABLE ATTORNEY FEES AND COSTS.  A COURT MAY AWARD TO THIS

21    STATE A CIVIL PENALTY OF $10,000.00 OR LESS FOR EACH VIOLATION OF

22    THIS ACT.  A COURT NEED NOT FIND IRREPARABLE HARM TO ENTER AN

23    INJUNCTION, BUT NEED ONLY FIND A VIOLATION OF THIS ACT OR FIND

24    THAT AN INJUNCTION WOULD PROMOTE THE PUBLIC INTEREST.

25         (2)  In addition to any relief afforded under this section,

26     the attorney general may exercise the authority to suspend or

27     revoke a license issued pursuant to this act.  A CHARITABLE



   00155'97 ***
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 1    ORGANIZATION, PROFESSIONAL FUND-RAISER, OR ANY OTHER PERSON WHO

 2    VIOLATES AN INJUNCTION OR OTHER ORDER ENTERED UNDER SUBSECTION

 3    (1) SHALL, IN ADDITION TO ANY OTHER REMEDY, PAY TO THIS STATE A

 4    CIVIL PENALTY OF NOT MORE THAN $10,000.00 FOR EACH VIOLATION,

 5    WHICH MAY BE RECOVERED IN A CIVIL ACTION BROUGHT BY THE ATTORNEY

 6    GENERAL.

 7         (3) The attorney general may,  exercise the authority

 8     granted in this section against a charitable organization or

 9     person which or who operates under the guise or pretense of being

10     an organization or person exempted by this act and is not in fact

11     an organization or person entitled to such an exemption.  IN

12    ADDITION TO ANY OTHER ACTION AUTHORIZED BY LAW, ISSUE A CEASE AND

13    DESIST ORDER, ISSUE A NOTICE OF INTENDED ACTION, OR TAKE OTHER

14    ACTION IN THE PUBLIC INTEREST.  THE ATTORNEY GENERAL MAY ACCEPT

15    AN ASSURANCE OF DISCONTINUANCE OF ANY METHOD, ACT, OR PRACTICE IN

16    VIOLATION OF THIS ACT FROM ANY PERSON ALLEGED TO BE ENGAGED IN OR

17    TO HAVE BEEN ENGAGED IN THAT METHOD, ACT, OR PRACTICE.  AN ASSUR-

18    ANCE OF DISCONTINUANCE MAY INCLUDE A STIPULATION FOR THE VOLUN-

19    TARY PAYMENT OF THE COSTS OF INVESTIGATION, FOR AN AMOUNT TO BE

20    HELD IN ESCROW PENDING THE OUTCOME OF AN ACTION OR AS RESTITUTION

21    TO AN AGGRIEVED PERSON, OR FOR THE VOLUNTARY PAYMENT TO ANOTHER

22    PERSON IF IN THE PUBLIC INTEREST.  AN ASSURANCE OF DISCONTINUANCE

23    SHALL BE IN WRITING AND SHALL BE FILED WITH THE CIRCUIT COURT FOR

24    INGHAM COUNTY.  AN ACTION RESOLVED BY AN ASSURANCE OF DISCONTINU-

25    ANCE MAY BE REOPENED BY THE ATTORNEY GENERAL AT ANY TIME FOR

26    ENFORCEMENT BY A COURT OR FOR FURTHER PROCEEDINGS IN THE PUBLIC

27    INTEREST.  EVIDENCE OF A VIOLATION OF AN ASSURANCE OF



   00155'97 ***
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 1    DISCONTINUANCE IS PRIMA FACIE EVIDENCE OF A VIOLATION OF THIS ACT

 2    IN ANY SUBSEQUENT PROCEEDING BROUGHT BY THE ATTORNEY GENERAL.

 3         (4) A PERSON WHO HAS VIOLATED SECTION 18 IS SUBJECT TO 1 OR

 4    MORE OF THE FOLLOWING PENALTIES:

 5         (A) PLACEMENT OF A RESTRICTION OR CONDITION ON THE PERSON'S

 6    REGISTRATION.

 7         (B) DENIAL, SUSPENSION, OR REVOCATION OF A REGISTRATION.

 8         (C) A CIVIL FINE OF NOT MORE THAN $10,000.00 TO BE PAID TO

 9    THE ATTORNEY GENERAL.

10         (D) A REQUIREMENT TO TAKE SOME TYPE OF AFFIRMATIVE ACTION,

11    INCLUDING THE PAYMENT OF RESTITUTION.

12         (5) THE ATTORNEY GENERAL SHALL, BEFORE SUSPENDING OR REVOK-

13    ING A REGISTRATION, ASSESSING A CIVIL FINE, OR ORDERING RESTITU-

14    TION, PROVIDE THE PERSON AGAINST WHOM THE PENALTY IS TO BE

15    IMPOSED AN OPPORTUNITY FOR A HEARING IN ACCORDANCE WITH THE

16    ADMINISTRATIVE PROCEDURES ACT OF 1969, 1969 PA 306, MCL 24.201 TO

17    24.328.

18         (6) A PERSON WHO SUFFERS A LOSS AS A RESULT OF A VIOLATION

19    OF THIS ACT MAY EXERCISE ANY RIGHT OR REMEDY CREATED UNDER SEC-

20    TION 11 OF THE MICHIGAN CONSUMER PROTECTION ACT, 1976 PA 331,

21    MCL 445.911.

22         Sec. 21.  (1) The attorney general may investigate  the

23     operations or conduct of charitable organizations, professional

24     fund raisers, or professional solicitors subject to this act.  He

25     may require a person, corporation, institution, or association,

26     and the officers, members, and employees and agents thereof, to

27     appear at a named time and place in the county designated by the



   00155'97 ***
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 1    attorney general or where the person resides or is found, to give

 2     information under oath and to produce books, memoranda, papers,

 3     records, documents of title, evidence of assets, liabilities,

 4     receipts, or disbursements in the possession or control of the

 5     person ordered to appear.  A COMPLAINT FROM ANY PERSON IN WHAT-

 6    EVER MANNER THE ATTORNEY GENERAL CONSIDERS APPROPRIATE AND MAY

 7    INVESTIGATE ON HIS OR HER OWN INITIATIVE A CHARITABLE ORGANIZA-

 8    TION, PROFESSIONAL FUND-RAISER, VENDOR, COMMERCIAL COVENTURER, OR

 9    PERSON DESCRIBED IN SECTION 23A.  THE ATTORNEY GENERAL MAY

10    REQUIRE A PERSON, CORPORATION, INSTITUTION, OR ASSOCIATION OR AN

11    OFFICER, MEMBER, EMPLOYEE, OR AGENT OF A CORPORATION, INSTITU-

12    TION, OR ASSOCIATION TO APPEAR AT A TIME AND PLACE SPECIFIED BY

13    THE ATTORNEY GENERAL TO GIVE INFORMATION UNDER OATH AND TO

14    PRODUCE BOOKS, MEMORANDA, PAPERS, RECORDS, DOCUMENTS, OR EVIDENCE

15    OF ASSETS, LIABILITIES, RECEIPTS, OR DISBURSEMENTS IN THE POSSES-

16    SION OF THE PERSON ORDERED TO APPEAR.

17         (2) When REQUIRING THE ATTENDANCE OF A PERSON, the attorney

18    general  requires the attendance of a person, he  shall issue an

19    order setting forth the time when and the place where attendance

20    is required and shall  cause the same to be served  SERVE THE

21    ORDER upon the person in the manner provided for service of pro-

22    cess in civil cases at least 5 days before the date fixed for

23    attendance.  The order shall have the same force and effect as a

24    subpoena and, upon application of the attorney general,

25     obedience to  the order may be enforced by a court having juris-

26    diction over the person  ,  OR the circuit court for the county

27    of Ingham  ,  or for the county where the person receiving  it 



   00155'97 ***
                                  39

 1    THE ORDER resides or is found, in the same manner as though the

 2    notice were a subpoena.  In case of  contumacy  FAILURE or

 3    refusal to obey the order issued by the attorney general, the

 4    court may issue an order requiring the person to appear before

 5    the court,  or  to produce documentary evidence,  if so ordered, 

 6    or to give evidence  touching  CONCERNING the matter in

 7    question.  Failure to obey the order of the court  shall be

 8     punished  IS PUNISHABLE by that court as  a  contempt.  The

 9    investigation may be  made  CONDUCTED by  or before  an assistant

10    attorney general OR OTHER PERSON designated  in writing  by the

11    attorney general.  to conduct the investigation.  The attorney

12    general or  the assistant attorney general acting in his behalf 

13    OTHER DESIGNATED PERSON may administer the necessary oath or

14    affirmation to witnesses.

15         (3) THIS ACT DOES NOT LIMIT OR RESTRICT THE POWERS OR DUTIES

16    OF THE ATTORNEY GENERAL THAT ARE AUTHORIZED UNDER ANY OTHER PRO-

17    VISION OF LAW.

18         SEC. 22A.  IF AN ORAL PLEDGE OR PROMISE TO MAKE A CONTRIBU-

19    TION IS THE RESULT OF A TELEPHONE OR DOOR-TO-DOOR SOLICITATION,

20    THAT PLEDGE OR PROMISE TO MAKE A CONTRIBUTION IS UNENFORCEABLE.

21         Sec. 23.  (1) A person who does any of the following is

22    guilty of a misdemeanor punishable by a fine of not more than

23     $500.00  $5,000.00, or imprisonment for not more than 6 months,

24    or both:

25         (a) Violates this act.

26         (b) Solicits  and  OR receives public donations, or sells

27    memberships in this state for  and  OR on behalf of any



   00155'97 ***
                                  40

 1    organization, institution, or association subject to the

 2    provisions of this act  and which  THAT is not  duly licensed

 3     pursuant to  REGISTERED UNDER this act.

 4         (c) Solicits funds under a  license  REGISTRATION and

 5     thereafter  diverts the  same  FUNDS to purposes other than that

 6    for which the funds were contributed.

 7         (2) This section  shall  DOES not  be construed to  limit or

 8    restrict prosecution under the general criminal statutes of  the 

 9    THIS state.

10         SEC. 23A.  (1) EXCEPT AS OTHERWISE PROVIDED IN SUBSECTION

11    (2), A PERSON WHO IS NOT A CHARITABLE ORGANIZATION BUT WHO SOLIC-

12    ITS CONTRIBUTIONS, CONDUCTS A FUND-RAISING EVENT, OR CONDUCTS A

13    SALES PROMOTION FOR A CHARITABLE PURPOSE IS SUBJECT TO THIS ACT.

14      (2) A PERSON SUBJECT TO THIS ACT UNDER SUBSECTION (1) IS NOT

15    REQUIRED TO REGISTER OR FILE REPORTS AS REQUIRED UNDER THIS ACT.

16         SEC. 23B.  (1) THE ATTORNEY GENERAL SHALL PREPARE A REPORT

17    TO THE SENATE AND TO THE HOUSE OF REPRESENTATIVES PROVIDING IN

18    DETAIL THE MEANS TO BE IMPLEMENTED TO EDUCATE THE PUBLIC REGARD-

19    ING CHARITABLE ORGANIZATIONS AND PROFESSIONAL FUND-RAISERS OPER-

20    ATING IN OR SOLICITING CONTRIBUTIONS IN THIS STATE.

21         (2) THE REPORT SHALL INCLUDE A DESCRIPTION OF THE INFORMA-

22    TION TO BE DISSEMINATED TO THE PUBLIC AND SHALL INCLUDE A PLAN TO

23    DISSEMINATE THE INFORMATION.

24         (3) THE REPORT SHALL BE PRESENTED TO THE SENATE AND TO THE

25    HOUSE OF REPRESENTATIVES NOT LATER THAN 1 YEAR AFTER THE EFFEC-

26    TIVE DATE OF THE AMENDATORY ACT THAT ADDED THIS SECTION.





   00155'97 ***
                                  41

 1         Enacting section 1.  Sections 14 and 22 of the charitable

 2    organizations and solicitations act, 1975 PA 169, MCL 400.284 and

 3    400.292, are repealed.


















































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