§ 43-17-3 - Registration of paid solicitors; renewal; financial statements; denial of registration; amendments; contracts; solicitation notices; accounting; deposit of contributions; records - Georgia Statutes

O.C.G.A. 43-17-3 (2010)
43-17-3. Registration of paid solicitors; renewal; financial statements; denial of registration; amendments; contracts; solicitation notices; accounting; deposit of contributions; records

(a) No paid solicitor shall solicit contributions for a charitable purpose in or from this state or on behalf of a charitable organization, unless such paid solicitor is a registered paid solicitor pursuant to this Code section. No paid solicitor shall solicit contributions in person unless such paid solicitor has been qualified for such means of solicitation by the Secretary of State.

(b) A fundraising counsel who at any time has custody of contributions from a solicitation for a charitable purpose must be registered as a paid solicitor and comply with the provisions of this Code section.

(c) (1) A paid solicitor shall be registered with the Secretary of State prior to engaging in any solicitation. A registration shall expire on December 31 of the year in which the registration became effective and may be renewed for additional one-year periods upon application and the payment of the appropriate fee.

(2) An application for registration as a paid solicitor may be made by any person and shall be accompanied by the registration fee set forth in subsection (d) of this Code section. Such application for registration shall be made in a manner prescribed by the Secretary of State, which may include, in whole or in part, electronic filing, shall be verified by the applicant, shall be filed with the Secretary of State, and shall contain the information and documents set forth in this paragraph and such other information as may be prescribed by rules and regulations promulgated by the Secretary of State:

(A) The name of the applicant;

(B) The address of the principal place of business of the applicant and the addresses of all branch offices of the applicant in this state;

(C) The form of business organization; the date of organization of the applicant; and if the business entity is a corporation or limited partnership, the date it qualified to do business in Georgia;

(D) The names and business addresses of all general partners, limited partners, directors, affiliates, or executive officers of the applicant; if the applicant is a limited liability company, the names and business addresses of all members of the limited liability company; a statement of the limitations, if any, of the liability of any general partner, limited partner, director, member, affiliate, or executive officer; and a statement setting forth in chronological order the occupational activities of each such general partner, limited partner, director, member, affiliate, or executive officer during the preceding ten years;

(E) A brief description of the general character of the business conducted or proposed to be conducted by the applicant;

(F) A list of any other states in which the applicant is registered as a paid solicitor and, if registration of the applicant as a paid solicitor has ever been denied, revoked, suspended, or withdrawn or if such a proceeding is pending in any state, full details with respect thereto;

(G) Whether the applicant or any general partner, limited partner, director, member, affiliate, or executive officer of such applicant has ever been subject to any injunction or disciplinary proceeding by any state agency involving any aspect of fund raising or solicitation, has ever been convicted of or charged with a misdemeanor of which fraud is an essential element or which involved charitable fund raising, or has ever been convicted of or charged with a felony and, if so, all pertinent information with respect to such injunction, disciplinary proceeding, conviction, or charge;

(H) Whether the applicant or any general partner, limited partner, director, member, affiliate, or executive officer of such applicant has ever been subject to an order, consent order, or any other disciplinary or administrative proceeding pursuant to the unfair and deceptive acts and practices law of any state and, if so, all pertinent information with respect to such order or proceedings; and

(I) Written consent by each control person of the paid solicitor, as described by rule of the Secretary of State, to a criminal background investigation for the purpose of verification by the Secretary of State of information provided in the application.

(3) If the paid solicitor will have physical possession or legal control over any contributions collected by it in or from this state, the applicant shall attach to the application for registration as a paid solicitor a financial statement for the fiscal year of the applicant which ended within one year prior to the date of filing unless the fiscal year of the applicant has ended within 90 days prior to the date of filing, in which case the financial statement may be dated as of the end of the fiscal year preceding such last fiscal year. Such financial statement shall be prepared in accordance with generally accepted accounting principles.

(4) Within 15 business days after an applicant has fully complied with this subsection, the Secretary of State shall examine each paid solicitor's registration application, solicitation notice, and contract to determine whether the applicable requirements of this chapter relating to the same are satisfied and shall register such applicant as a paid solicitor unless he or she shall find that there are grounds for denial as provided in Code Section 43-17-7. When the Secretary of State has registered an applicant as a paid solicitor, he or she shall immediately notify the applicant of such registration. In the event the Secretary of State has not notified the applicant of deficiencies or grounds for denial of the application within such period, the applicant may conduct himself or herself in a manner as if registered until and unless such applicant is so notified.

(5) If the Secretary of State finds that there are sufficient grounds to deny the registration of the applicant as provided in Code Section 43-17-7, he or she shall issue an order refusing to register the applicant. The order shall state specifically the grounds for its issuance. A copy of the order shall be mailed to the applicant at his or her business address and to any charitable organization who proposes to employ such applicant.

(6) Every registration under this Code section shall expire on December 31 of each year. The registration of a paid solicitor must be renewed each year by the submission of a renewal application containing the information required in an application for registration, except to the extent that the Secretary of State by rule does not require the resubmission of such information which has previously been included in an application or renewal application previously filed; by the payment of the proper registration fee; and, if it would be required in the event of an initial application, by the filing of a financial statement as of a date within one year prior to the date of filing unless the fiscal year of the applicant has ended within 90 days prior to the date of filing, in which case the financial statement may be dated as of the end of the preceding fiscal year. Such financial statements shall be prepared in accordance with generally accepted accounting principles.

(7) The registration of a paid solicitor shall be amended within 30 days to reflect a change of name, address, principals, state of incorporation, or other changes which materially affect the business of the paid solicitor. Such amendments shall be filed in a manner which the Secretary of State may prescribe by rule or regulation.

(d) The fee for the initial registration of a paid solicitor shall be $250.00. The fee to amend the registration shall be $15.00. The annual renewal fee for a paid solicitor registration shall be $100.00.

(e) (1) There shall be a contract between a paid solicitor and a charitable organization which shall be in writing, shall clearly state the respective obligations of the paid solicitor and the charitable organization, and shall state the amount of compensation that the paid solicitor will receive. Such compensation shall be stated as a fixed amount, as an amount to be derived from a formula, or as a percentage of the gross revenue derived from the solicitation campaign, subject to and in accordance with the provisions of paragraphs (2), (3), and (4) of this subsection.

(2) If the compensation of the paid solicitor is contingent upon the number of contributions or the amount of revenue received from the solicitation campaign, the stated amount shall be expressed as a fixed percentage of the gross revenue.

(3) If the compensation of the paid solicitor is not contingent upon the number of contributions or the amount of revenue received, the stated amount shall be a reasonable estimate, expressed as a percentage of the gross revenue, and the contract shall clearly disclose the assumptions upon which the estimate is based. The stated assumptions shall be based upon all the relevant facts known to the paid solicitor regarding the solicitation to be conducted as well as the past performance of solicitations conducted by the paid solicitor.

(4) The compensation description required by this subsection shall exclude any amount which the charitable organization is to pay as expenses of the solicitation campaign, including the cost of merchandise or services sold or events staged. The contract shall clearly describe who shall pay such expenses, how they will be paid, and whether such payment is contingent upon any event or fact, including, but not limited to, the amount of funds raised through the solicitation campaign. If any portion of the expenses are paid separately by the charitable organization apart from the other fees paid to the paid solicitor, the contract shall include a reasonable estimate of such expenses.

(f) Prior to the commencement of each solicitation campaign the paid solicitor shall file with the Secretary of State a completed "solicitation notice" on forms prescribed by the Secretary of State. The Secretary of State may provide that said filing be made, in whole or in part, through electronic means. The solicitation notice shall include a copy of the contract described in subsection (e) of this Code section, the projected dates when soliciting will commence and terminate, the location and telephone number from which the solicitation will be conducted, the name and residence address of each person responsible for directing and supervising the conduct of the campaign, a statement as to whether the paid solicitor will at any time have custody of contributions, and a full and fair description of the charitable program for which the solicitation campaign is being carried out.

(g) Within 90 days after a solicitation campaign has been completed, and on the anniversary of the commencement of a solicitation campaign lasting more than one year, the paid solicitor shall account to the charitable organization with whom it has contracted and to the Secretary of State for all contributions collected and expenses paid. The accounting shall be in the form of a written report, submitted to the charitable organization and to the Secretary of State, shall be retained by the charitable organization for three years, and shall contain the following information:

(1) The total gross receipts;

(2) A description of how the gross receipts were distributed, including an itemized list of all expenses, commissions, and other costs of the fundraising campaign and the net amount paid to the charitable organization for its charitable purposes after payment of all fundraising expenses, commissions, and other costs;

(3) The signature of the charitable organization acknowledging its agreement with the accuracy of the report, or a statement from the paid solicitor stating the reasons why such signature has not been obtained within the prescribed period, including a summary of any communications from the charitable organization contesting the accuracy of the report;

(4) With respect to any contributions other than monetary donations and securities, including, but not limited to, boats, motor vehicles, clothing, shoes, books, appliances, and other household items received as a result of solicitations by a paid solicitor:

(A) The names and addresses of any persons to whom such contributions were delivered by the paid solicitor, by the charitable organization whose name was used in connection with the solicitation, or by their agents; provided, however, that this subparagraph shall not require the names and addresses of donees or retail purchasers of consumer products which are delivered to a charitable organization to be given away or sold at retail by the charitable organization with the proceeds of such sales being used to further the stated charitable purpose of the organization;

(B) The total consideration, if any, received by the paid solicitor, by the charitable organization, or by their agents from such persons for such contributions; and

(C) The manner in which such consideration was calculated; and

(5) Such other information as the Secretary of State by rule may require.

(h) Each monetary contribution received by the paid solicitor shall, in its entirety and within three business days of its receipt, be deposited in an account at a federally insured financial institution. The account shall be in the name of the charitable organization with whom the paid solicitor has contracted and the charitable organization shall have sole control of all withdrawals from the account.

(i) (1) The paid solicitor shall maintain during each solicitation campaign and for not less than three years after its completion, the following records:

(A) The name and, if known to the paid solicitor, the address of each person pledging to contribute together with the date and amount of the pledge;

(B) The name and residence address of each employee, agent, or other person, however styled, involved in the solicitation;

(C) A record of all contributions at any time in the custody of the paid solicitor;

(D) A record of all expenses incurred by the paid solicitor for which the charitable organization is liable for payment;

(E) The location and account number of all accounts in which the paid solicitor has deposited revenue from the solicitation campaign; and

(F) Such other records as may be prescribed by the Secretary of State by rule and regulation.

(2) If the paid solicitor sells tickets to an event and represents that tickets will be donated for use by another, the paid solicitor shall also maintain for the same period as specified in paragraph (1) of this subsection:

(A) The name and address of those contributors donating tickets and the number of tickets donated by each contributor; and

(B) The name and address of all organizations receiving donated tickets for use by others, including the number of tickets received by each organization.

(3) All records of such paid solicitor are subject to such reasonable periodic, special, or other examinations by representatives of the Secretary of State, within or outside this state, as the Secretary of State deems necessary or appropriate in the public interest or for the protection of the public, provided that the Secretary of State shall not disclose this information except to the extent he or she reasonably deems necessary for investigative or law enforcement purposes.

(j) Not later than 90 days following the end of each solicitation campaign, the paid solicitor shall provide to the charitable organization, at no cost, a copy of all records described in subsection (i) of this Code section. In the event any such campaign exceeds six months in length, such records shall be provided, in addition, not less than 30 days following the end of each six-month period.