New York Attorney General Andrew Cuomo is conducting a “wide-ranging” probe into potential fraud by charities that accept automobiles for donations.

At a press conference, Mr. Cuomo said his office filed a lawsuit Tuesday seeking to shut down one charity and issued subpoenas to 16 other New York charities, fundraisers and individuals in the charitable car donation industry.

“It’s early in the investigation,” Mr. Cuomo said. “We have reason to believe the fraud is widespread in this area.”

Mr. Cuomo said his office has uncovered instances where charities are accepting cars for donations, but the bulk of the funds from the sale of the cars aren’t going to the persons or causes the organizations purport to support.

The attorney general sued Feed the Hungry Inc. in New York state court in Manhattan on Tuesday. Mr. Cuomo claims Nicholas Cascone Jr., the charity’s director, kept the bulk of the proceeds to enrich himself.

Only about 1.8%, or less than $7,900, of $430,000 the group received as donations between 2002 and 2009 went to help the homeless, Mr. Cuomo said.

Feed the Hungry advertised for car donations in New York, New Jersey, Pennsylvania and Connecticut.

The lawsuit seeks to freeze the charity’s assets and permanently bar it from seeking further charitable donations in the future.

The subpoenas sent by Mr. Cuomo’s office on Tuesday are seeking materials related to revenues obtained by the charities and fundraisers from car donations and how those funds were used.

(Source: Wall Street Journal)