2010 Arizona Revised Statutes
Title 44 - Trade and Commerce
44-6554 Contracted fund raisers; registration, reregistration, contract and disclosure requirements

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.