Attorney General sues Mill Creek couple for illegal charity scam

The charged couple sought donations in Issaquah, among other cities.

December 23, 2013 1:49 pm

The Washington state Attorney General’s office has filed a Consumer Protection Act complaint and will seek a temporary restraining order against Knowledge 4 Kids, otherwise known as Kures 4 Kids, and its operators, Michael and Amy Gannon.

The AG’s office alleges the Mill Creek couple uses numerous deceptive practices to entice consumers to donate money. Despite giving the impression donations will help children, the Gannons apply only a small percentage of donations to a charitable purpose, the complaint said. The rest goes into the Gannons’ pockets and other expenses such as paying employees.

The couple reportedly sought donations outside the QFC store in Issaquah.Charitable donations typically increase during the holidays. The Attorney General’s office is asking for an immediate restraining order to prevent the Gannons from seeking donations during this peak giving time.

“This is the third time the Gannons have been involved in deceptive business practices,” said Washington State Attorney General Bob Ferguson. “We’ll keep pursuing them until they stop scamming consumers.”

According to the complaint, the Gannons founded and lead the charitable organization Knowledge 4 Kids, or Kures 4 Kids (K4K). They claim to raise money to support families of children with disabilities and to support other charitable organizations.

K4K asks for donations at tables set up inside or outside grocery stores and other retail establishments. Investigators observed K4K solicitors telling potential donors they were volunteers even though they are paid a rate of $10 per hour. After collecting money, the solicitors meet the Gannons to count the money. The solicitors are then paid in cash from the donations.

The AGO alleges the Gannons committed multiple violations of the Washington State Consumer Protection and Charitable Solicitation Acts:

  • Creating the false impression that most or all money will be used to assist families of children with disabilities;o Misrepresenting paid solicitors are volunteers; and
  • Misrepresenting their relationship with various charitable organizations they claim to raise money for. The complaint also claims that the Gannons:
  • Failed to register as a commercial fundraiser with the Secretary of State;
  • Failed to register K4K’s contracts with commercial fundraisers;
  • Failed to include required disclosures in brochures and on-line solicitations; and
  • Failed to maintain financial records.

The state is seeking civil penalties and other relief. Many donations were made in cash, making it difficult to return money to donors. To the extent recovered funds cannot be returned to donors, they will be used to benefit the public through efforts such as preventative outreach campaigns.

The Attorney General’s office recommends consumers consider these tips before donating:

  • Don’t give in to pressure. Tell the solicitor you want to take time to make your decision. And remember, it is always OK not to donate.
  • Ask for written material about the charity to take home and research to see if their donations help other charities as they claim.
  • Ask the solicitor if he or she is registered with the Office of Secretary of State.
  • Don’t be fooled by a name. Some use similar sounding names that closely resemble respected, well-established charities.

Those who think they have been the victim of a consumer scam can file a complaint with the Attorney General’s office by calling 1-800-551-4636 or visit http://www.atg.wa.gov/FileAComplaint.aspx. After filing a complaint, the Attorney General’s office will contact the business to explain the complaint in order to help resolve the dispute. The complaint resolution process is free.