The Georgia Attorney General’s Office announced a cancer charity accused of operating a deceptive fundraising scheme was shut down.
Attorney General Chris Carr, in collaboration with the Federal Trade Commission (FTC) and 21 agencies from 18 states, has dismantled a deceptive charity fundraising scheme operated by Kars-R-Us.com, Inc. that misused millions of dollars intended for breast cancer screenings.
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The scheme, which the AG’s office said was led by Michael Irwin and Lisa Frank, solicited donations nationwide under the guise of supporting the United Breast Cancer Foundation, Inc.
However, only $126,815 of the over $45 million raised was actually used for breast cancer screenings, according to a complaint filed by the FTC and state agencies.
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“For anyone to fraudulently solicit donations for something as serious as breast cancer detection is absolutely unconscionable,” Carr said in a statement.
Kars-R-Us.com, Inc. solicited vehicle donations through various media channels, claiming that these contributions would help UBCF provide free and low-cost breast cancer screenings.
However, the complaint alleges that the majority of the funds raised were used to pay Kars, its operators, and vendors.
Georgia was the 10th largest donor state, with 1,992 donated cars at a value over $908,000.
Despite the large volume of donations, the funds were not used as promised to support breast cancer screenings.
The proposed settlement order imposes strict restrictions on Kars and its operators.
Irwin, the former president and co-owner, is permanently banned from fundraising activities, while Frank and the company are prohibited from making misrepresentations in fundraising and marketing.
“This case should send a strong message to fundraisers that the FTC will take action if they misrepresent the truth and exploit the kindness of generous donors for their own gain,” Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, said.
The settlement also includes a monetary judgment of $3,882,091 against Kars, Irwin, and Frank, which is partially suspended due to their inability to pay the full amount, according to the AG’s office.
If they are found to have misrepresented their financial status, the full judgment will become payable.
The settlement aims to prevent future deceptive fundraising practices and protect consumers from similar schemes, officials said.
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