Charity to appeal Hosemann’s order

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Published: July 26,2010

Tags: charitable giving, charities, state government

WAVELAND — The Secretary of State’s Office has cited a Waveland charity for a list of violations of the state’s charitable solicitations laws.

The state also said the charity allowed Kathleen Johnson, who had previously been convicted of felony financial crimes, to have virtual control over the charity’s financial and day-to-day operations.

Secretary of State Delbert Hosemann said the state this past week issued a cease-and-desist notice against the Waveland Citizens Fund, which no longer operates in Waveland, but rather, in Pearl River County.

The non-profit status for WCF expired July 11, but it is entitled to an administrative hearing, Hosemann said.

Johnson told the Sea Coast Echo that WCF will file an appeal on the state’s decision to shut down the organization and said she would continue her charity work.

“The board of directors are aware of the secretary of state complaint on the procedural issues that they inherited from former boards prior to this current set of directors.

“They are looking forward to clarifying and clearing up the issues at the administrative hearing. The critical rebuilding work in the field will continue as it is not related to fund raising,” she said.

Hosemann said WCF has 30 days to request a hearing and if the state does not reverse its decision, it could permanently strip WCF of is registration as a nonprofit and impose a $25,000 fine for each offense.

WCF was created after Hurricane Katrina. Its purpose was to collect and distribute donations made to the city of Waveland and its residents, former board member Joan Coleman said. In 2006, the WCF received nonprofit status from the state and was able to broaden its charitable solicitation.

Johnson came to Waveland in 2006 as a volunteer. Johnson began working alongside board members coordinating volunteer and donation efforts, and soon became the unofficial leader of her own group, Katrina Relief, and the WCF, officials said.

In 2007, a very public feud between Johnson and Mayor Tommy Longo erupted over Johnson’s possession of personal information and files on residents who were seeking help from WCF.

It was then learned that Johnson, now 58, had been convicted in Cheyenne, Wyo., in Aug. 1992 on three felony charges.

Johnson served four months in prison and spent three years on probation, federal officials said. Her charges included bank fraud, fraudulent use of social security numbers and fraud relating to student loans.

Hosemann said that his office investigated WCF in 2007, and told the WCF Johnson could not be associated with the charity.

The state also noted numerous mistakes with bookkeeping, collection of receipts, petty cash funds, and other records, he said.

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