Maryland Attorney General Anthony G. Brown and Secretary of State Susan C. Lee announced settlements that will permanently shut down two nonprofits, Maryland Youth Club of America and Virginia Youth Club of America, and ban their founder and leadership from operating or soliciting for charities in Maryland.

The action follows a joint investigation with authorities in Washington, DC and Virginia, which found the organizations recruited school aged children to sell candy door to door while falsely claiming the proceeds would support scholarships and programs for at risk youth. “These adults exploited children twice, first by sending them door to door as salespeople, then by misusing the money donors thought would help at risk youth,” Brown said.

Investigators said the nonprofits misrepresented their charitable activities, diverted funds for personal use, and destroyed financial records, leaving large amounts of money unaccounted for. Lee said her office “strongly opposes deceptive charitable practices” and will act to protect the integrity of the nonprofit sector, adding, “We are committed to keeping bad actors out of the nonprofit world and upholding Maryland’s charity laws.” Under the settlements, both organizations will be dissolved, their officers permanently barred from charitable solicitation in Maryland, and $5,000 will be redirected to legitimate nonprofits serving at risk youth.