On January 6, Pennsylvania’s Department of State, Bureau of Charitable Organizations became the first entity to impose a fine on Another Chance 4 Horses, the Bernville horse rescue operation at the center of numerous investigations at the state and the federal level. After establishing that Christy and Rick Sheidy, the couple who were the Secretary and the President of the non-profit, had violated several regulations under which non-profits in Pennsylvania operate, the state fined the Sheidy’s $5,000. In addition they are prohibited from soliciting funds for two years.
The rescue/adoption organization seemingly began running out of chances in April, 2013 when the FBI raided its offices. At the time, very little information was released, and Christy Sheidy, who owned Another Chance 4 Horses, said that the FBI was concerned about equine health certificates. In fact, the search warrant issued by U.S. District Court Judge Henry Perkin in Allentown noted that investigators were seeking evidence of criminal acts such as wire fraud. Recent developments have made it clear that the health certificates were irrelevant to the overarching investigation of Another Chance 4 Horses.
The Department of State charged the Sheidy’s with four violations of Pennsylvania’s Solicitation of Funds for a Charitable Purpose Act, and the two were directed to appear at a hearing in September to answer the charges.
They were charged with failing to provide financial records required by the state. According to the document filed after the matter was adjudicated, the Sheidy’s had been asked to provide the state with routine documentation that detailed the financial operations of Another Chance 4 Horses and the organization’s activities that furthered its mission. The Bureau of Charitable Organizations reviews these materials as a matter of course periodically. The Sheidy’s could not produce complete reports, despite more than one subsequent request, and thus the financial information about their organization was incomplete. The failure to maintain comprehensive records and to provide them when requested violates Pennsylvania’s Solicitation of Funds for a Charitable Purpose Act.
In addition to the problems with their financial records, the Sheidy’s also continued to solicit funds after their certificate of registration had expired in November, 2012, a further violation of the state’s rules governing non-profits. In August 2013 the state issued a cease and desist order, meant to stop the organization from soliciting funds. They violated that order as well.
Finally the Sheidy’s were also charged with violating their fiduciary responsibilities as officers of Another Chance 4 Horses by taking money out of the organization’s bank account and using that money for personal non-charitable purposes. Christy Sheidy had admitted to a Bureau of Charitable Organizations investigator that she had written checks against the organization’s bank account to make mortgage and tax payments on the Sheidy’s home. In addition the couple used money from Another Chance 4 Horses’ account to purchase a time-share apartment in Florida. She said they had planned to use the time-share to raise money for the organization through raffles.
The Sheidy’s claimed that they were unable to provide the documents that the state requested because the Internal Revenue Service (IRS) had seized their files as part of their investigation of Another Chance 4 Horses. They were notified of a hearing scheduled by the Bureau of Charitable Organizations for September 12, at which the state’s charges against them were to be discussed. They filed written responses to the charges but did not appear at the hearing at which they would have been cross-examined and required to testify to the veracity of their responses; therefore their responses were not admitted to the record.
The IRS revoked the 501(c)3 status of Another Chance 4 Horses after the organization failed to file Form 990 for three consecutive years. The IRS also placed a lien on the organization in 2014 for $19,000 in unpaid taxes. Although the FBI had staged the 2013 raid on Another Chance 4 Horses’ office, there is no word on whether additional action is forthcoming. Investigators from the Allentown office of the FBI had been gathering testimony from people who may have been defrauded by Another Chance 4 Horses. But a spokesman for the FBI said they could not comment on the status of the investigation.
It’s not clear whether the Sheidy’s and their organization will face additional charges or penalties.