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ACT NO. 51

(S.120)

Home Improvement Fraud and Charitable Solicitations

This act creates a new crime of home improvement fraud. A person convicted of home improvement fraud is required to register with the department of labor and industry and must file with the department a surety bond or an irrevocable letter of credit in an amount of $50,000.00 if the person wants to continue to engage in home improvement activities for profit. Penalties range from two to five years’ imprisonment and fines of $1,000.00 to $10,000.00 depending upon the type of offense, how much money was defrauded, and whether the crime was a first or subsequent offense.

The act also regulates activities between a charitable organization and a paid fundraiser. A contract between a charitable organization and a paid fundraiser is required to contain a provision that prohibits the paid fundraiser from restricting in any way the use by the charitable organization of the list of donors to the campaign. Additionally, upon application for state funds received through a grant or contract, a charitable organization is required to disclose the actual percentage of gross receipts of any fundraising campaign paid to the charitable organization within the two previous fiscal years, and the minimum contracted percentage of gross receipts to be paid by a paid fundraiser to the charitable organization in any current or known future fundraising campaign.

Finally, the act provides that no paid fundraiser may solicit a contribution from any person in Vermont without clearly and conspicuously disclosing to the person, both orally, if the paid fundraiser is soliciting in whole or in part by telephone, and in writing, if the paid fundraiser is soliciting in whole or in part by means of writing:

(1) that the solicitor is being paid by the charitable organization on whose behalf the solicitation is being made; and

(2) how the potential contributor may obtain information from the state on the respective percentages of contributions that will be paid to the charitable organization and to the paid fundraiser.

Effective date: From passage, June 2, 2003.