A man who the state believes solicited tens of thousands of dollars in donations for hungry children and then kept all but $800 of the money has been told by the state to stop ripping people off.
However, Lanny Gray - founder of Feed the Children Foundation - does not have to pay back any of the money he is accused of keeping or pay a penny in fines unless he continues to break the law.The Division of Consumer Protection built a case against Gray and his foundation but decided not to pursue it in court after Gray turned over his records to the state and promised to stop breaking the law, said Gary Hansen, director of the division.
"We felt rather than really destroy him, we could keep him from doing this kind of thing again," Hansen said of his decision not to penalize Gray. "We actually had a case made against Mr. Gray. But - with the aid of his attorney - he cooperated quite fully with us. He pledged to operate an honest business in the future. We thought we settled it rather quickly and expediently without a whole lot of expense to the state."
Gray began soliciting funds for his Feed the Children Organization in June and stopped sometime this month, said Heather Barney, public information officer for the division.
Because Gray didn't keep any rec-ords, "we can't even get a good figure of how much he raised but we have a strong indication that it was into the tens of thousands of dollars," Hansen said.
Gray raised the money by telling people federal funding for the Women Infants and Children Program had been slashed in half, according to a settlement agreement reached between Gray and the state on Friday.
He told people that because of the cuts, 600 children would be dropped from WIC each month and "many would starve," the agreement said.
Gray assured people the money he raised would provide food vouchers to those dropped from WIC. He claimed that in one week alone he had donated $2,000 to the WIC program, the agreement said.
Of the tens of thousands of dollars he raised, Gray only donated $800 to WIC, the agreement said.
The state did fine Gray $5,000 but stayed the fine after Gray promised to stop breaking the law. The state also put Gray on five years' probation, during which time he cannot solicit funds for organizations that are not valid charitable organizations.
If Gray does begin raising funds while on probation, he must keep rec-ords of the money he raises and submit an independent audit to the state every three months tracking his solicitations, the state's settlement agreement said.
The agreement listed seven violations of the Charitable Solicitations Act and the Consumer Sales Practices Act committed by Gray. The violations are civil offenses, not criminal ones, Hansen said.
"I don't think we should have spent a lot of taxpayer money on a case where the person is volunteering to sign an agreement not to commit any further offenses of this nature," he said.
Hansen does not worry about sending a signal to other solicitors that the state is soft on those who keep the money they raise.
"I don't think there are that many people out there inclined to want to do the sorts of things that would violate our Charitable Solicitations Act," Hansen said.