If you want to know what nonprofit regulators are worried about, it helps to look at what they are choosing to highlight publicly. The National Association of State Charity Officials’ “Latest News & Annual Reports” page is useful for exactly that reason. Its recent items are not limited to old-fashioned fraud cases. They also feature disputes over donor intent, scrutiny of online fundraising pages, governance failures, and new digital compliance tools for tax-exempt organizations. The 2025 NASCO annual report likewise groups state activity around solicitations, governance, restricted funds, registration enforcement, dissolutions and transactions, outreach, and legislation.
The Bigger Story: Regulators Are Connecting the Dots
The main takeaway is that regulators seem to be taking a more integrated view of nonprofit accountability. They are not looking only at whether an organization filed the right paperwork or whether someone committed outright fraud. They are also looking at whether the organization is being governed responsibly, whether fundraising done in its name is transparent, and whether charitable assets are being used consistently with donor expectations and organizational purpose.
For nonprofit leaders, that matters because many organizations still manage these issues in separate silos. Governance is one topic. Fundraising is another. Financial controls are another. Gift restrictions get attention only when a problem arises. But the trend in the NASCO materials suggests regulators are increasingly asking a broader question: can this organization be trusted to manage charitable resources responsibly from top to bottom?
Governance Is No Longer Just an Internal Matter
One of the clearest signals from the annual report is that governance problems are being treated as real enforcement concerns. The 2025 report includes a separate governance section, with examples involving weak board oversight, conflicted transactions, poor recordkeeping, misuse of nonprofit funds, boards that met infrequently, and failures to maintain basic controls.
That means governance is not just about having the right policies sitting in a binder. Regulators appear increasingly interested in whether boards actually supervise, ask questions, review financial information, manage conflicts, and create a culture of accountability. When those things are missing, the issue can become much more than an internal management problem.
Online Fundraising Has Become a Leadership Issue
Another strong theme is online fundraising. NASCO’s recent news page highlights Alaska’s lawsuits against several fundraising-related companies for allegedly creating donation pages for nonprofits without their knowledge or consent, using public information to solicit donations. It also highlights a multistate letter led by California asking GoFundMe to prove removal of allegedly plagiarized charity pages.
Whatever the ultimate outcome of those matters, the message for nonprofit leaders is clear: if fundraising is happening in your organization’s name, regulators may expect you to know about it and to exercise some oversight. That includes understanding how your name, mission, and donor appeals appear on third-party sites. It also means asking whether donors could be confused about who is actually running a campaign, where the money goes first, what fees are taken out, and whether the nonprofit ever approved the page in the first place.
Many organizations have treated third-party fundraising pages as background noise. That is getting riskier. Online giving may feel like a marketing issue, but it is increasingly a trust and accountability issue too.
Donor Intent Still Matters — Especially During Change
One of the most interesting recent NASCO items is Ohio’s lawsuit against Hebrew Union College. According to the item on NASCO’s page, Ohio’s attorney general is seeking to ensure that charitable assets remain dedicated to supporting a permanent rabbinical school in Cincinnati after the institution decided to close that school at the end of the 2025–26 academic year.
For nonprofit leaders, the lesson is not limited to that case. It is a reminder that when organizations change course — by closing a program, moving operations, selling major assets, merging, or redefining mission priorities — regulators may focus closely on donor expectations and the original purpose for which assets were raised or received. The 2025 annual report underscores that point by separately calling out trusts, estates, and restricted charitable funds, as well as dissolutions and transactions, as major areas of state oversight.
That means strategic decisions should not be viewed only through an operational or financial lens. Leaders should also ask: were donations or other assets given for a narrower purpose than the organization now wants to pursue? If so, those questions need attention early, before a major announcement or restructuring is already underway.
Fraud Still Matters, but It Is Not the Whole Story
The NASCO page does include classic misconduct cases: alleged diversion of charitable donations, sham nonprofits, and organizations accused of misleading donors. Recent items include an Ohio lawsuit against an alleged sham animal rescue, an Ohio indictment involving alleged theft of charitable donations, a Kentucky action shutting down a fraudulent veterans group, and multistate actions involving deceptive youth charities.
But the important point for nonprofit leaders is that the page is not only about outright bad actors. It sits side by side with stories about governance, digital fundraising, charitable-asset stewardship, and compliance modernization. That mix suggests regulators are paying attention to the overall integrity of nonprofit operations, not just criminal or obviously deceptive conduct.
Compliance Is Becoming More Digital — and More Visible
NASCO’s page also points to the IRS’s April 8, 2026 expansion of Business Tax Account access to tax-exempt organizations and to the revised requirement that Form 8976 be submitted electronically through Pay.gov beginning March 9, 2026.
That may sound technical, but it is part of the same larger picture. Regulators are building systems that make compliance more standardized and more transparent. The annual reports also describe guidance, webinars, training, and digital tools at the state level. That means the operational side of compliance is becoming harder to ignore and harder to excuse.
For nonprofit leaders, this is a prompt to make sure someone in the organization actually owns these processes. Too often, digital filing access, registrations, annual reports, and tax-related accounts live with one employee, one outside bookkeeper, or one volunteer treasurer. That creates risk. A better approach is to have a board calendar with regular reports to the Board and process document that other can access if the individual managing those tasks leaves or is otherwise unable to follow-through.
Regulators Are Also Signaling What Good Practice Looks Like
Another useful point from the NASCO materials is that regulators are not only enforcing. They are also educating. The 2024 annual report describes state efforts such as governance videoconferences, fraud-awareness materials, tutorials, and Ohio’s “Charitable University,” which focuses on board governance, filings and recordkeeping, fundraising, and financial activities.
That matters because it suggests regulators are trying to raise the baseline for what competent nonprofit management should look like. In other words, the expectation is not merely “avoid fraud.” It is also “run the organization with enough structure and oversight that fraud, confusion, misuse, and mission drift are less likely to happen.”
What Nonprofit Leaders Should Do With This
The practical lesson is not that every organization should panic. It is that leaders should stop treating governance, fundraising oversight, donor restrictions, and compliance systems as separate topics.
Boards and executives should be asking a few simple questions. Do we know what fundraising is happening in our name online? Do we have clear internal controls over spending and payment tools? Do we understand any donor restrictions that could matter if we change direction? Is our board getting the information it needs to exercise real oversight? Is there a reliable process for state registrations, IRS notices, and digital filing access? Those questions line up closely with the trends highlighted in NASCO’s recent materials.
Closing Thought
The takeaway from NASCO’s page is not simply that regulators are active. It is that their focus appears increasingly connected. Governance, online fundraising, donor protection, financial controls, and stewardship of charitable assets are being viewed as parts of the same trust-and-accountability picture. Nonprofit leaders who see those as separate issues may be missing where oversight is headed. (NASCO)
Ellis Carter is a nonprofit lawyer with Caritas Law Group, P.C. licensed to practice in Washington and Arizona. Ellis advises nonprofit and socially responsible businesses on federal tax and fundraising regulations nationwide. Ellis also advises donors concerning major gifts. To schedule a consultation with Ellis, call 602-456-0071 or email us through our contact form.