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Cancer

FTC Cracks Down on Deceptive Charity Fundraiser: Kars-R-Us.com Scheme Exposed

Strategic Insights

— 2 min read

Kars-R-Us.com and its operators, Michael Irwin and Lisa Frank, made false or deceptive claims to U.S. donors, soliciting charitable donations nationwide on behalf of the United Breast Cancer Foundation, Inc. (UBCF). Despite raising over $45 million, only a fraction, $126,815 or 0.28%, was used to fund breast cancer screenings. The Federal Trade Commission, along with 22 agencies from 19 states, stopped the deceptive charity fundraising scheme and imposed restrictions on future fundraising activities.

Key Takeaways:

  • Kars-R-Us.com and its operators, Michael Irwin and Lisa Frank, raised over $45 million on behalf of UBCF between 2017 and 2022.
  • Only $126,815 or 0.28% of the donations were used to fund breast cancer screenings.
  • The proposed settlement order restricts Kars and its operators from making misrepresentations associated with fundraising or in the marketing or sale of any product or service.
  • Michael Irwin, the former President and co-owner of Kars, is permanently banned from fundraising.
  • Lisa Frank, the current President and sole owner of Kars, is prohibited from making misrepresentations associated with fundraising.
  • Kars, its employees, and anyone actively working for or engaged with the company are restricted from making misrepresentations associated with fundraising.
  • Irwin, Frank, and Kars face a total monetary judgment of $3,882,091, partially suspended due to their inability to pay the full amount.

Statistics:

  • $45.5 million: the amount raised by Kars-R-Us.com on behalf of UBCF between 2017 and 2022.
  • 0.28%: the percentage of donations used to fund breast cancer screenings.
  • 84,000: the number of well-intentioned people who donated their vehicles to Kars.
  • $34.9 million: the amount of funds used to pay Kars, its operators, and its vendors.
  • $126,815: the amount of donations used to fund breast cancer screenings.
  • 19: the number of states participating in the investigation.

Sources:

  • Federal Trade Commission (FTC)
  • United States District Court for the Central District of California
  • Arkansas Attorney General's Office
  • California Attorney General's Office
  • Colorado Attorney General's Office
  • Connecticut Attorney General's Office
  • Delaware Attorney General's Office
  • Florida Attorney General's Office
  • Georgia Attorney General's Office
  • Illinois Attorney General's Office
  • Indiana Attorney General's Office
  • Maryland Attorney General's Office
  • New York Attorney General's Office
  • North Carolina Attorney General's Office
  • Oklahoma Attorney General's Office
  • Oregon Attorney General's Office
  • Utah Attorney General's Office
  • Virginia Attorney General's Office
  • West Virginia Attorney General's Office
  • Wisconsin Attorney General's Office
  • Maryland Secretary of State's Office
  • North Carolina Secretary of State's Office
  • South Carolina Secretary of State's Office
  • Utah Division of Consumer Protection

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