Tex. Rev. Civ. Stat. art. 9023e
Art. 9023e. Telephone Solicitations by Charitable Organizations
Scope of Act
Sec. 1.
The solicitation of contributions from persons in this state shall be considered to be engaging in
telephone solicitation in Texas, regardless of where the solicitation originates.
Definitions
Sec. 2.
In this Act:
(1)
"Charitable organization" means a person, other than a governmental law enforcement agency or
organization, who solicits contributions or funds and is or holds himself, herself, or itself out to be
established or operating for a charitable purpose relating to law enforcement, including nongovernmental law
enforcement organizations, nongovernmental law enforcement publications, and survivors of law enforcement
officers who are killed in the line of duty.
(2)
"Commercial telephone solicitor" means a person who is retained by a charitable organization to solicit
contributions or funds by telephone, whether done individually or through another person under the direction
of the commercial telephone solicitor. The term does not include a bona fide employee, officer, director, or
volunteer of a charitable organization.
(3)
"Contribution" means the promise to give or the gift of money, credit, property, financial assistance,
or other thing of any kind or value, except volunteer services. The term does not include bona fide fees,
dues, or assessments paid by members if membership is not conferred solely as consideration for making a
contribution in response to a telephone solicitation.
(4)
"Knowingly" means with actual awareness, but actual awareness may be inferred if objective
manifestations indicate that a person acted with actual awareness.
(5)
"Person" means an individual, partnership, corporation, association, or other legal entity.
(6)
"Telephone solicitation" means the use of a telephone to solicit another person to make a charitable
contribution to an organization.
Register To Be Maintained
Sec. 3.
(a)
The attorney general shall establish and maintain a register of charitable organizations
subject to this Act.
(b)
All documents required to be filed with the attorney general under this Act are public information and
shall be available to the public under the open records law, Chapter 552, Government Code, except those
documents that identify the donors of a charitable organization, which information is confidential and is not
subject to disclosure.
Registration
Sec. 4.
(a)
The attorney general shall maintain a registry of charitable organizations that submit to the
attorney general completed registration statements that contain:
(1)
the legal name and each assumed name, the mailing address and street address, and each telephone number
and facsimile number of each office, chapter, local unit, branch, and affiliate of the charitable
organization;
(2)
the employer identification number of the charitable organization;
(3)
the name, title, address, and telephone number of each officer, director, and executive director or
other chief operating officer of the charitable organization;
(4)
the name of each officer, director, or employee who is compensated by the charitable organization or
who has custody and control of funds of the charitable organization and who has been convicted of or pleaded
nolo contendere to a misdemeanor involving fraud or the theft, misappropriation, misapplication, or misuse of
property of another, or any felony, including the offense and the state, court, and date of each conviction or
plea of nolo contendere;
(5)
the date the charitable organization was incorporated and the state of incorporation or, if not
incorporated, the type of organization and the date established; the day and month on which the organization's
fiscal year ends; and whether the organization is eligible to receive tax-deductible contributions under
Section 170, Internal Revenue Code of 1986 (26 U.S.C. Section 170);
(6)
a statement as to whether the organization has applied for or been granted tax exempt status by the
Internal Revenue Service and, if so, the date of the application, the date the exemption was granted or
denied, the Internal Revenue Code section on which the application was based, and a statement as to whether or
when the tax exemption has ever been denied, revoked, or modified;
(7)
the date the organization began doing business in this state and the name and address of the
organization's registered agent in this state;
(8)
a statement of the charitable organization's charitable purposes and a list of the programs for which
funds are solicited;
(9)
a statement that includes:
(A)
the names, addresses, and telephone numbers of the organization's accountants and auditors and the
method of accounting used;
(B)
a statement that the charitable organization has attempted in good faith to comply with all Texas
county and municipal ordinances regarding telephone solicitation that have been filed with the attorney
general or, if none apply, a statement to that effect;
(C)
for charitable organizations that engage the services of commercial telephone solicitors, the name and
address of each commercial telephone solicitor engaged in the preceding 12 months, as well as written
confirmation from the commercial telephone solicitor that it has complied with all state and local
registration laws;
(D)
the amount paid to commercial telephone solicitors during the preceding 12 months;
(E)
the total contributions received during the preceding 12 months; and
(F)
the total fund-raising costs during the preceding 12 months, computed pursuant to generally accepted
accounting principles;
(10)
a copy of the charitable organization's most recently filed Internal Revenue Service Form 990 and
other federal tax returns, including all supplements, amendments, and attachments to those returns and
requests for extensions to file those returns or, if the charitable organization does not file federal tax
returns:
(A)
a statement as to the reason none is filed; and
(B)
the charitable organization's most recent financial statements, including audited financial statements,
if any have been prepared; and
(11)
a sworn statement verifying that the information contained in the registration statement and all
attachments to the statement are true, correct, and complete to the best of the affiant's knowledge.
(b)
A charitable organization shall file its initial registration statement before the 10th working day
preceding the date on which the organization begins telephone solicitation in this state.
(c)
Registration expires on the 15th day of the fifth month after the last day of a charitable
organization's fiscal year. Renewal registration statements shall be filed on the same forms required for
initial registration statements and must include the name and employer identification number of the charitable
organization and any changes to the information previously submitted to the attorney general. For items on
which there is no change from the previous year's registration statement, "no change" may be indicated.
(d)
A filing fee not to exceed $ 50 must accompany the initial registration statement. A $ 50 filing fee
must accompany all renewal registration statements.
(e)
The registration statements shall be submitted on forms prescribed or approved by the attorney general.
(f)
A volunteer that has been authorized to solicit on behalf of a charitable organization is not required
to register under this Act.
Bond
Sec. 5.
A commercial telephone solicitor shall post a surety bond with the secretary of state in the amount
of $ 50,000 issued by a surety company authorized to do business in this state.
Notification of Noncompliance
Sec. 6.
(a)
A charitable organization that is not in compliance with this Act shall be notified of
noncompliance by the attorney general by first class mail at the organization's last reported address.
Noncompliance includes failure to file any documents required by this Act or the filing of incomplete or
inaccurate documents.
(b)
A charitable organization violates this Act if the organization:
(1)
fails to file complete documents within 30 days after the date the notice required by Subsection (a) of
this section has been mailed; or
(2)
knowingly files materially inaccurate documents.
Recordkeeping; Audit Powers of Attorney General
Sec. 7.
(a)
Each charitable organization required to file a registration statement shall keep true books
and records as to its activities within this state in a form to enable it to accurately provide the
information required by this Act. The books and records shall be retained for a period of at least three years
after the end of the period to which the registration statement relates. All books and records of a charitable
organization shall be made available for inspection and copying by authorized personnel of the attorney
general on written request by authorized personnel of the attorney general.
(b)
A charitable organization shall make available the information requested by authorized personnel of the
attorney general at the organization's principal place of business within 10 working days of the date of the
request, or at a time and place as may be agreed.
(c)
The authority established by this section is in addition to other statutory or common law audit or
investigative authority of the attorney general.
Registration Does Not Imply Endorsement
Sec. 8.
Registration under this Act does not imply endorsement by this state or the attorney general, and
charitable organizations are prohibited from stating or implying to the contrary.
Remedies
Sec. 9.
(a)
The attorney general may institute an action for failure to fully and accurately comply with
this Act and may obtain injunctive relief to restrain a person from continuing a violation, cancellation or
suspension of the registration, an order restraining the person from doing business in this state while
violating this Act, a civil penalty of not more than $ 25,000 per violation, or injunctive relief and a civil
penalty. A person who violates an injunction issued under this section is liable to the state for a civil
penalty of not less than $ 100,000.
(b)
The remedies authorized by this Act are not exclusive but are in addition to any other procedure or
remedy provided for by other statutory or common law.
(c)
In any proceeding successfully prosecuted by the attorney general under this Act, the court may allow
the attorney general to recover civil penalties and the reasonable costs, expenses, and attorney's fees
incurred in bringing the suit.
Dedication of Fees and Civil Penalties
Sec. 10.
In addition to other money, all fees assessed under this Act and all recovered expenses incurred
in obtaining injunctive relief and administrative and civil penalties authorized by this Act are dedicated for
use by the attorney general in enforcing and administering this Act. Recovered expenses include investigative
costs, witness fees, attorney's fees, and deposition expenses.
Venue
Sec. 11.
An action under this Act shall be brought in a court of competent jurisdiction in Travis County,
in the county in which the charitable organization has its principal place of business or has a fixed and
established place of business at the time the suit is brought, or in the county in which solicitation
occurred.
Notice to Contributors; Prohibition
Sec. 12.
(a)
If less than 90 percent of the contributions or funds collected by a charitable organization
or commercial telephone solicitor are paid by the charitable organization or commercial telephone solicitor to
a charitable organization, the commercial telephone solicitor shall notify each person solicited by telephone,
before accepting a contribution or funds from the person, of the percentage of the contributions or funds that
will be paid to the organization for which the contributions or funds are being solicited and the percentage
that will be retained by the solicitor. This information shall also be included on any written statement
mailed to the contributor.
(b)
A charitable organization or commercial telephone solicitor may not make a telephone call to solicit
contributions or funds unless the call is made after 9 a.m. and before 7 p.m., Monday through Friday.
Prohibited Practices
Sec. 13.
(a)
A person may not commit an unfair or deceptive act or practice in the conduct of solicitations
for a charitable organization.
(b)
A person may not represent to a person solicited that a contribution is to be used to benefit the
survivors of a law enforcement officer killed in the line of duty unless:
(1)
100 percent of the contributions collected are used to benefit those survivors; or
(2)
the person solicited is informed in writing of the exact percentage of the contribution that will
directly benefit those survivors.
Rules
Sec. 14.
The attorney general may adopt rules, procedures, and forms that are consistent with and necessary
for the proper administration and enforcement of this Act.
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Compliance Guide:
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