UPDATE: ROCKFORD (WIFR) -- A Dakota man has been sentenced to four years and eight months in federal prison for a charity fraud scheme.
34-year-old Clifford Edwards, Jr., who also lived in Loves Park, admitted to setting up call centers for two fake charities, Helping Out and Smiles for Kids Foundation, over a three year period from 2010 to 2013. The U.S. attorney's office says Edwards' fake charities defrauded more than 3,600 people out of over $120,000.
When Edwards pled guilty he admitted that all the money he collected was used on himself or his phony organizations.
ROCKFORD (WIFR) -- Federal fraud charges are filed against a Stateline man accused of running a charity and keeping the money for himself.
Clifford Edwards, Jr., admits, after two years of being in operation, donations to the Smiles for Kids Foundation have not yet been passed along to kids with cancer.
"I ran a for profit charity. I did not agree with the fact that only 20 percent went to the charity so what I decided to do was get out of the for profit end and start the not for profit end Smiles for Kids,” Clifford Edwards, Jr. said Wednesday outside the headquarters of his charity.
Edwards says he's determined to help children battling cancer, even though he admits the foundation he started in 2011 has not yet made any deliveries to sick kids.
"Two to three weeks at the most we were about the start distributing the toys. We also have e-mails of conversations between the board of directors and Smiles for Kids at Children's Memorial Hospital. So they were aware that we were going to be giving toys to children memorial as well," Edwards added.
Edwards says the toys he had bought, as well as the organization’s e-mails and other records were confiscated by the Feds to use as evidence. He’s charged with mail fraud and stealing $120,000 from his own foundation; charges he says are entirely false.
"The allegations state I stole $120,000. We have not even brought in $120,000. Someone who steals $120,000 usually drives a Lexus or fancy vehicles and I shower in a basement and live in an office to make this work."
A living arrangement funded by Smiles for Kids. Edwards admits the foundation is not set up as a 401c charity, meaning it's not tax deductible, and he's always made sure to tell that to donors. Edwards says he wanted to grow the charity before giving away toys and care packages to kids. He believes as long as he re-invested in the charity, he wasn't breaking the law.
Edwards will be back in court in August. If he is found guilty of fraud, Edwards faces 20 years in prison for each of the 20 counts against him.
STATELINE (WIFR) – A Dakota man is accused of setting up a couple of fake charities and bilking Stateliners out of tens of thousands of dollars.
33-year-old Clifford Edwards Jr. has pleaded not guilty to 20 counts of fraud. The Feds say he started up “Helping Out” and the “Smiles for Kids Foundation” and claimed the money he raised would help children with cancer. However, the indictment alleges he spent the $120,000 he collected on himself.