Florida Lawmakers Pass Bill to Protect Charities From Scammers

Legislation would shield charities from giving back donations from people later revealed to be scam artists

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    NEWSLETTERS

    The money might be tainted, but Florida lawmakers don't think charities should have to give back donations from people later revealed to be scam artists.

    Legislation aimed at shielding charities from coughing up such money they took in good faith won final passage on a 35-2 Senate vote Thursday.

    The bill, which previously cleared the House on a 114-0 vote, now goes to Gov. Rick Scott.

    The bill (HB 95) would protect charities from a legal action known as a "clawback," in which trustees in bankruptcy cases try to recover funds to help pay creditors or other victims.

    Sen. Nancy Detert, who shepherded the bill through the Senate, said such actions can financially cripple charities forced to give back large sums of money.

    She said there have been instances when bankruptcy trustees "have gone too far" in getting charities to give back money they took in good faith without knowing the donor's shenanigans.

    "It's a shock to them a couple of years later to have to come up with these big bills," Detert said during the Senate debate.

    The Venice Republican noted that a Jewish Family Center in her community was asked to give back a six-figure amount in such a case.

    Con artists often try to win the trust of well-heeled investors by attending charitable functions and making large contributions, she said.

    The bill would exempt contributions to qualified religious or charitable organizations from clawback efforts if the donations were made more than two years before the legal action started, she said.

    Rep. Doug Holder, R-Venice, is the main sponsor of the bill. Detert had sponsored a companion bill in the Senate.

    Sen. Jeremy Ring, a Margate Democrat, voted against the measure Thursday. He said he appreciated the intent to protect charities, but said that investors who were lured into Ponzi schemes also deserve to be protected.

    "They want to get their money back, and I think they deserve to get their money back first," he said.

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