Ellison calls stadium fundraising nonprofit a ‘sham charity’
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Attorney General Keith Ellison announced a settlement requiring a nonprofit to dissolve after an investigation found hundreds of employees were misclassified as volunteers at concession stands in Twin Cities stadiums.
Ellison called MN Fundraising Initiative a “sham charity.”
He said it took advantage of parents who wanted to pay for their children's activities by working at venues such as Target Field and U.S. Bank Stadium in exchange for grants. Other venues included Grand Casino Arena, Allianz Field and numerous University of Minnesota locations.
His office said the nonprofit wasn’t operated for any charitable cause and instead operated as a staffing agency that saved on labor costs by misclassifying hundreds of employees.
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The settlement alleges MNFI earned more than $3.4 million in annual revenue during 2024, according to its most recently reported IRS Form.
“Charities can’t do an end-run around employment law by abusing their nonprofit status to save on labor costs. Workers who are misclassified do not receive some of the most basic protections under the law, and that loss of protections hurts us all,” Ellison said.
MNFI neither admits nor denies the allegations in the settlement. The nonprofit is based in Blaine and was founded in 2019 by Martin and Patricia Cross. Martin served as the CEO until his termination on March 20, while Patricia served as the treasurer until her resignation on Feb. 7.
“When awarding grants, MNFI did ‘not evaluate the financial need of grant applicants’ or otherwise support communities with a charitable purpose,” according to the settlement. “MNFI awarded grants to benefit workers or their family members in amounts that were tied to the number of hours an individual ‘volunteered’ for the organization.”
Ellison’s office said 20 board members or their family members received approximately $1.1 million in grant funding from MNFI over the course of its existence.
Ellison’s office said MNFI admitted a “large majority of the total grants” MNFI awarded went to “support educational programming and enrichment opportunities that benefit[ted] the families of MNFI volunteers.”
The settlement said a “child of one former board member alone received more than $237,631 purportedly based on work performed by that Board member at MNFI-staffed concession stands.”
Ellison said MNFI must wind up any remaining affairs and dissolve under the terms of the settlement.
