44-6554

44-6554. Contracted fund raisers;
registration, reregistration, contract and disclosure
requirements

A. A contracted fund raiser shall register with the secretary of state before
engaging in a solicitation on behalf of a charitable organization, even if the charitable
organization is exempt pursuant to section 44-6553 from the registration requirements
prescribed in section 44-6552. Applications for registration or reregistration shall be
in writing, under oath, in the form prescribed by the secretary of state and accompanied
by a fee of twenty-five dollars. The application shall contain information required by
the secretary of state, including a list of all states in which the contracted fund
raiser conducts fund raising activities and the agency in each state that licensed,
registered or certified the contracted fund raiser. A registration is valid for one year
and may be renewed for additional one year periods on application and payment of the fee.

B. Notwithstanding section 35-155, at the time of applying for registration and
renewal of registration, a contracted fund raiser shall file with and have approved by
the state treasurer a bond in which the contracted fund raiser is the principal obligor
in the amount of twenty-five thousand dollars, with one or more responsible sureties
whose liability in the aggregate as sureties at least equals that amount. The contracted
fund raiser shall maintain the bond in effect as long as the registration is in
effect. The bond, which may be in the form of a rider to a larger blanket liability
bond, shall run to the state and to a person who may have a cause of action against the
principal obligor of the bond for any liabilities resulting from the obligor's conduct of
any activities subject to this article or arising out of a violation of this article or
any rule adopted pursuant to this article.

C. The secretary of state may deny an application for registration or may revoke
the registration of a contracted fund raiser for any of the following reasons:

1. Substantial and material misstatement or omission in the submitted application.

2. Conviction of a felony substantially related to solicitation by any employee,
member, officer or director who has any solicitation responsibilities on behalf of the
organization or any other person holding any proprietary or beneficial interest in the
contracted fund raiser, unless the civil rights have been restored.

3. An order or judgment by a court in any jurisdiction that the contracted fund
raiser has engaged in deceptive, fraudulent or unlawful business practices that
substantially relate to solicitation.

4. Violating any provision of this article.

5. The return of a check issued to the order of the secretary of state due to
insufficient funds or any other reason for nonpayment.

D. If the secretary of state denies an application, the secretary of state shall
notify the applicant within ten days after receiving the application and shall state the
reasons for the denial.

E. There shall be a written contract between a contracted fund raiser and a
charitable organization that clearly states the respective obligations of the contracted
fund raiser and the charitable organization and the compensation of the contracted fund
raiser.

F. Before the commencement of a solicitation campaign for a charitable organization
the contracted fund raiser shall file with the secretary of state a completed
solicitation notice on forms prescribed by the secretary of state. The solicitation
notice shall include:

1. A copy of the contract described in subsection E of this section.

2. The projected dates when solicitation will commence and terminate.

3. The location and telephone number from which the solicitation will be conducted.

4. The name and residence address of each person responsible for directing and
supervising the conduct of the solicitation campaign.

5. A statement as to whether the contracted fund raiser will have custody of
contributions at any time.

6. A full description of the charitable program for which the solicitation campaign
is being carried out and, if different, a description of the programs and activities of
the organization on whose behalf the solicitation campaign is being carried out.

G. A contracted fund raiser is responsible for complying with, or for causing
compliance with, both of the following restrictions:

1. It shall not be represented that any part of the contributions received will be
given or donated to another charitable organization unless that organization has
consented in writing to the use of its name before the solicitation.

2. It shall not be represented that tickets to events will be donated for use by
another unless the following requirements are met:

(a) The contracted fund raiser has a written commitment from a charitable
organization stating that it will accept donated tickets and specifying the number of
tickets it is willing to accept.

(b) Contributions for donated tickets are not solicited in excess of the number of
ticket commitments received from a charitable organization.

H. Within ninety days after the solicitation campaign covered by the written
contract prescribed in subsection E of this section has been completed and on the
anniversary of the commencement of a solicitation campaign lasting more than one year,
the contracted fund raiser shall file with the secretary of state a financial report for
the campaign, including gross revenue and an itemization of all the identifiable expenses
incurred. The report shall be completed on a form prescribed by the secretary of state
and shall be signed by an authorized official of the contracted fund raiser who
certifies, under oath, that it is true to the best of the contracted fund raiser's
knowledge.

I. The contracted fund raiser shall maintain, during each solicitation campaign and
for at least three years after its completion, the following records:

1. The name and, if known to the contracted fund raiser, the address of each person
pledging to contribute together with the date and amount of the pledge.

2. The name and residence address of each employee, agent or other person involved
in the solicitation.

3. A record of all contributions at any time in the custody of the contracted fund
raiser.

4. A record of all expenses incurred by the contracted fund raiser for which the
charitable organization is liable for payment.

5. The location and account number of all bank or other financial institution
accounts in which the contracted fund raiser has deposited revenue from the solicitation
campaign.

J. If the contracted fund raiser sells tickets to an event and represents that
tickets will be donated for use by another, the contracted fund raiser shall also
maintain for the same period as specified in subsection I of this section all of the
following:

1. A copy of the written commitment required by subsection G of this section.

2. The names and addresses of the contributors donating tickets and the number of
tickets donated by each contributor.

3. The names and addresses of all organizations receiving donated tickets for use
by others, including the number of tickets received by each organization.

K. All records described in subsections I and J of this section shall be available
for inspection by the secretary of state on request.

L. Each contribution in the custody of the contracted fund raiser, in its entirety
and within seven business days of its receipt, shall be deposited in an account at a bank
or other federally insured financial institution. The account shall be in the name of
the charitable organization with which the contracted fund raiser has contracted, and the
charitable organization shall have sole control of all withdrawals from the account
unless the contracted fund raiser and the charitable organization have entered into a
written agreement concerning the disposition of contributions.

M. Any material change in any information filed with the secretary of state
pursuant to this section, including any material change to the contract prescribed in
subsection E of this section, shall be reported in writing to the secretary of state
within sixty days of the change pursuant to rules adopted by the secretary of state.

N. The secretary of state shall examine each contracted fund raiser registration
application and solicitation notice to determine whether the applicable requirements of
this article relating to the contracted fund raiser registration application and
solicitation notice are satisfied. The secretary of state shall notify the contracted
fund raiser within ten business days of its receipt of any deficiencies in the contracted
fund raiser registration application and solicitation notice or it is deemed approved as
filed.