SENATE SUBSTITUTE NO. 1
SENATE BILL 368
AN ACT TO AMEND TITLE 6 OF THE DELAWARE CODE RELATING TO PROHIBITED TRADE PRACTICES.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE:
Section 1. Amend Chapter 25, Title 6. Delaware Code by adding a new Subchapter IX thereto to read as follows:
"Subchapter IX. Charitable/Fraternal Solicitation
§ 2591. Short Title.
This subchapter may be cited as the 'Delaware Charitable/Fraternal Solicitation Act of 1996:
§ 2592. Purpose.
The purpose of this Act is to safeguard the public against fraudulent and misleading charitable/fraternal solicitations, thereby enhancing public confidence in legitimate charitable/fraternal organizations.
§ 2593. Definitions.
As used in this subchapter unless the context otherwise requires:
(1) 'Charitable/fraternal organization' means any person who is or holds himself or herself out to he established (i) for any benevolent. educational, humane. scientific, patriotic. social welfare or advocacy, public health. environmental conservation, civic or philanthropic purpose, or (ii) for the benefit of law enforcement officers, firelighters or other persons who protect the public safety, or (iii) any organization otherwise subject to §501(C) of the Internal Revenue Code of 1986, as amended:
(2) 'Charitable/fraternal purpose' means (i) any benevolent, educational, humane. scientific, patriotic, social welfare or advocacy, public health, environmental conservation, cis, is or philanthropic objective, or (ii) an objective to benefit law enforcement officers, firefighters or other persons who protect the public safety:
(3) 'Charitable/fraternal solicitation' means any oral or written request, directly or indirectly, for money, credit, property, financial assistance or other thing of value on the plea or representation that such money, credit, property, financial assistance or other thing of value or any portion thereof, will be used for a charitable/fraternal purpose or the benefit of a charitable/fraternal organization. No actual contribution need be made in order for a charitable/fraternal solicitation to be deemed to have taken place.
(4) 'Contribution' means the grant, promise or pledge of money, credit, property. financial assistance or other thing of value in response to a charitable/fraternal solicitation.
(1) 'Person' means any individual, organization, corporation, government, or
governmental subdivision or agency. business trust, estate. trust, partnership, unincorporated association. limited liability company, limited liability partnership, two or more of any of the foregoing having a joint or common interest, or any other legal or commercial entity.
(6) 'Professional solicitor' means a person who, for financial consideration, solicits contributions for a charitable/fraternal purpose or on behalf of a charitable/fraternal organization, either personally or through agents or employees employed or designated for that purpose. The term does not include a charitable/fraternal organization or an officer, director, employee, member, or volunteer of a charitable/fraternal organization.
§ 2594. Records.
(a) Every professional solicitor shall keep accurate fiscal records regarding its charitable/fraternal solicitations in Delaware.
(b) There shall he a written contract between a professional solicitor and a charitable/fraternal organization that clearly states the respective obligations of the professional solicitor and the charitable/fraternal organization and the compensation terms of the professional solicitor.
(c) Every professional solicitor shall retain the records and the written contract required pursuant to this section for a least three years from the effective date of the termination of such contract,
(d) Every professional solicitor shall review the requirements of this Act prior to executing each written contract with a charitable/fraternal organization.
§ 2595. Unlawful Practices.
(a) The act. use. or employment by any person of any deception, fraud, false pretense. false promise, misrepresentation, or the concealment, suppression. or omission of any material fact with the intent that others rely upon such concealment, suppression of omission in connection with a charitable solicitation, whether or not any person has in fact been misled, deceived or damaged thereby
(b) Such acts or practices shall include but are not limited to any one of the following:
(1) the failure of any person to identify himself or herself by name prior to making a charitable solicitation;
(1) the failure of a person to identify the charitable/fraternal organization for which the charitable/fraternal solicitation is being made or the charitable/fraternal purpose of the solicitation prior to making the solicitation:
(2) if the solicitation is made by a professional solicitor, the failure to disclose that the person soliciting the contribution is. or is employed by, a professional solicitor and the identity of the professional solicitor
(3) upon request by the person being solicited. the !Mime of any person to disclose the amount/percentage of the contribution that will he turned over to the charitable/fraternal organization, the amount/percentage of the contribution to be used or the charitable/fraternal purposes for which it is being solicited, or the amount/percentage to be retained by the professional solicitor. to the extent the amount/percentage of the contribution to be turned over to the charitable/ fraternal organization is not known at the time of the solicitation. the person shall disclose a good faith estimate of the percentage/amount of the contribution to be turned over to the charitable/fraternal organization: and
(4) the use or reference to the term "police", "law enforcement'', "trooper", "rescue squad", "firemen". or "firelighter" unless (i) the person making such representations is employed by a bona fide police, law enforcement, rescue squad, or tire department and the person is authorized by such entity to engage in charitable solicitation, or (ii) such entity has authorized the use or reference to such term in writing for the purpose of charitable/fraternal solicitation;
(6) the representation that a percentage or the contribution will be used for a charitable/fraternal purpose if the person has reason to believe the contribution will not be used for a charitable/fraternal purpose:
(6) the representation that another person. as defined by § 2593(b)(5). endorses the solicitation unless such person has consented in writing to the use of the person's name for the purpose of endorsing the solicitation:
(6) the representation that the contribution is solicited on behalf of anyone other than the charitable/fraternal organization that authorized the solicitation in accordance with this
(7) the use of the name of any charitable/fraternal organization without the written consent of the charitable/fraternal organization:
(8) the use of a name, symbol or statement so closely related or similar to that used by another charitable/fraternal organization or governmental agency that the use thereof would tend to confuse or mislead the public:
(11) the failure to create and/or maintain the records and written contracts as required by § 2594 of this Title with the intent to hinder the discovery of practices otherwise prohibited by this Act or having otherwise been in violation of this subsection: and
(12) the failure to comply with § 2596 on three separate occasions.
(c) No charitable/fraternal organization or any officer, director, member, volunteer or employee of a charitable/fraternal organization shall be deemed in violation of this section for an unlawful practice committed by a professional solicitor unless the charitable/fraternal organization or such officer. director. member, volunteer. or employee has actual prior knowledge of such unlawful practice or the charitable/fraternal organization or such officer. director. member. volunteer or employee had fraudulent intent in connection with the unlawful practice.
§2596. Time Restriction.
No charitable/fraternal organization and/or professional solicitor shall engage in charitable/fraternal solicitation of any person after 9:00 pm or before 8 a m. unless authorized by the person being solicited prior to the solicitation.
§2597. Enforcement and Remedies
(a) The Attorney General shall hate the same authority in enforcing, remedying and otherwise carrying out the provisions of this subchapter as is provided by §2517 of Title 20. and by §§2511-2527 and §§2531-2536 of Title 6.
(b) AM violation of 4 2595 of this subchapter shall be deemed an unlawful practice in violation of 4 2513 of this Title and willful violations of § 2595 of this subchapter shall be punishable in accordance with §2513(e) and/or §2581 of this Title.
(c) The remedies and penalties provided for in this subchapter are not exclusive and shall he in addition to and other procedures. rights or remedies which exist with respect to any other provisions of lass including but not hunted to State and/or Federal criminal prosecutions and/or actions brought by private parties "
Section 2. This Act shall he effect Re 60 days after enactment.
Section 3. Severability Clause.
If any provision of this Act or the application thereof to any person or circumstance is held invalid. such invalidity shall not affect other pros, 'shins or applications of the Act which can be given effect without the invalid provisions or application. and to that end the provisions of this Act are declared to be severable.
Approved July 25. 1996