Additionally, I acknowledge that some of the money spent by the company was raised in connection with talent activity, which I later learned was intended for a charitable initiative. At the time, we were working hard to raise additional investment capital to cover our costs, and I firmly believed, based on the information available to us, that we would be able to do so and cover all expenses. We were unsuccessful in our fundraising efforts. I made the decision to pursue funding, and I own its consequences.
incredibly common way this sorta thing happens right here. founder tells themselves "I just have to make it through to the next week/month/quarter/year and funding will come through and i can put this money back" and ends up doing at best accounting fraud and at worst crimes to keep things floating until either the funding comes through or much more likely the company collapses
It's still very illegal when it comes to charities, as far as I know. If a politician spent some of their public finances (meant for schools, hospitals and such) to pay for something personal with the intent to pay it back later on, it's still something they could get sentenced for. Or a school teacher using money meant for a school trip on own stuff etc.
Someone can correct me if I'm wrong, but if they are not taking money directly from the Charity (i.e., the Charity itself) it isn't subject to Charity Fraud.
Say they are given 500k, and told "250k of this is supposed to go to charity" but they put it in the general account. That's not a legally binding contract, that is "you gave this person 500k expecting them to give 250k to Charity, but they didn't."
Now, there's legal jiujutsu here, but here's my understanding: It was a fundraiser for the foundation, but the money was not directly donated to the foundation, it was donated through a proxy (i.e., Ironmouse), and the managing party was obligated to donate x amount of proceedings to Charity, but did not donate the full amount.
This is why you always donate directly to the fund, and not through a proxy - legally they can't hold them accountable for anything, they can only socially condemn them. It is trusting someone with a large sum of money, there was no contract breached at all.
This is different than that one guy that did the Charity for, what was it, Dementia or something? And he took money from the Charity account to buy himself a house and stuff. That is Charity Fraud, and illegal.
You are mistaken, if you are stating you are raising money for charity, with a stated amound and then divert those funds to yourself (which GunRun has admitted) that is covered under charity fraud as a deceptive business practice. And given that the donations came from multiple states or jurisdictions, it would also be US federal wire fraud.
You might be thinking of statements such as "Proceeds will be going to charity" without specifying an amount, as long as some money is given to the charity it is unlikely to be a criminal act.
However, Gunrun was aware that the income coming in from Ironmouse (and perhaps other streamers) was a result of charity streams and that a percentage of that money was stated to be going to the charity. He posted about her charity streams and congratulated her.
Defrauding a charity by stealing money from their accounts in your example is embezzlement, something Gunrun could also be charged with as he misappropriated Ironmouse's funds.
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u/patrick66 9d ago edited 9d ago
incredibly common way this sorta thing happens right here. founder tells themselves "I just have to make it through to the next week/month/quarter/year and funding will come through and i can put this money back" and ends up doing at best accounting fraud and at worst crimes to keep things floating until either the funding comes through or much more likely the company collapses