April 9, 2008
Farmington, Mo. - A California man who solicited donations online for a non-existent retreat for returning war veterans and for a veterans museum in Branson must stop soliciting funds in Missouri, both for the foundation he set up in connection with the retreat - which purportedly was to be set up in Phelps County - and for the museum, with which he is not associated. Attorney General Jay Nixon sued James Barbee of Carpinteria, Calif., and Liberty Spirits Farm Foundation last September in connection with the solicitations; a trial on Nixon's lawsuit was held in Farmington in February.
St. Francois County Associate Circuit Judge Robin E. Fulton on Tuesday (April 8) found that the defendants violated state consumer protection laws in their solicitations by misrepresenting that the operation of the rural retreat in Missouri was imminent, by misrepresenting that donations made to the foundation would be used for the retreat, and by soliciting charitable donations in Missouri without being properly registered.
Judge Fulton also ruled that Barbee violated the law by misrepresenting that the National Veterans Memorial Museum was a 501(c)3 educational non-profit corporation, and that donations made to him or his foundation for the museum were tax deductible. Barbee also did not disclose that he did not own the museum. The court order also found that Barbee wrote himself several thousand dollars in checks from bank accounts set up in the name of Liberty Spirits Farm Foundation.
"It is very unfortunate that someone would exploit the goodwill of Missourians for the men and women in our military in order to solicit donations using these kinds of false pretenses," Nixon said. "This judgment serves notice that we will continue to be vigilant to stop this type of fraudulent behavior."
The judge issued a permanent injunction to stop Barbee and the foundation from soliciting funds in Missouri for the foundation or for the Veterans Memorial Museum in Branson. The defendants also are prohibited from concealing, suppressing or omitting material facts about their tax-exempt status and that donations to them are not tax-deductible. The defendants also cannot solicit any charitable funds in Missouri without being properly registered.
Barbee and the foundation were ordered to jointly pay a $2,000 penalty to the state, and more than $6,000 to the Attorney General's Office for the costs of investigating and prosecuting the case.