Minneapolis nonprofit founders push back on lawsuit alleging they misused $2M in charitable assets
A Minnesota couple is accused of misusing nonprofit assets to fund "lavish lifestyles," according to a lawsuit filed by the Minnesota Attorney General's Office.
The lawsuit is filed against Larry and Sharon Cook and their nonprofits, Real Believers Faith Center and Les Jolies Petites School of Dance, based in north Minneapolis.
"[The Cooks] diverted more than $2 million in charitable assets from Les Jolies and Real Believers to fund lavish lifestyles, luxury travel, designer goods, and for-profit ventures masquerading under nearly identical names, while pretending to serve their communities," the lawsuit reads.
Larry Cook is the senior pastor at Real Believers Faith Center and called the lawsuit a lie.
"It's an absolute 1,000% fabrication of the facts," Cook said on Tuesday. "It's a fiction, and I'm glad we're here to talk about it, because we do great work in the community."
The Attorney General's Office claims that over the course of about six years, more than $1.3 million in funds were misspent from Real Believers and approximately $800,000 from Les Jolies. The lawsuit says some of those funds were spent at Michael Kors, Louis Vuitton, at a hotel in London and to pay the Cooks' homeowners association for parking fines and late fees.
The lawsuit also accuses the couple of making false statements to the IRS and taking out loans that "served no charitable purpose."
When the couple sat down with WCCO inside the church, they didn't dispute the purchases and said they were all made for charitable purposes.
"I do get a salary for what I do at [Les Jolies], so they're acting like we took everything that was for the nonprofit and spent it on ourselves, which is a total lie," said Sharon Cook.
As for the travel, the couple said those are ministry trips with church parishioners and each person paid their own way.
"[The Attorney General's Office is] gonna have to answer when we get to the courtroom, because documents and truth don't lie," said Larry Cook.
The couple got some media attention a few years ago when they bought a nearby crime-ridden gas station. The lawsuit says they used nonprofit funds to help cover the gas station bills, while the money made went into a for-profit bank account.
The lawsuit also accuses the Cooks of failing to register with the Minnesota Attorney General's Office as required by law, as well as violating the Minnesota Nonprofit Corporation Act.
The Minnesota Attorney General's Office said a temporary restraining order is in place to protect the nonprofit assets from being diverted.
The Cooks called this lawsuit politically motivated, saying the Attorney General's Office is under pressure to fight fraud. The couple also said Attorney General Keith Ellison has been to their church in the past.
A spokesperson for Ellison said he does know the Cooks, given their prominence in the north Minneapolis community where he lives. The spokesperson said Ellison recused himself from the case at the start of the investigation.
"He directed his Chief Deputy Attorney General to follow the facts wherever they lead, take any actions necessary to protect charitable assets from misuse, and uphold the law, which is exactly what the office is doing by filing this lawsuit," the spokesperson wrote.