Founder Of Charity Pleads Guilty To Fraud

Winner Of '89 National Jefferson Award Skimmed $76,200 From The Group He Started To Aid Children

By Terry Horne

Former Bloomington salesman David Cain, whose volunteer work was once recognized nationally, admitted Thursday in federal court to skimming $76,200 in bingo revenues from the charity he founded, the Children's Organ Transplant Association.

Cain, 61, pleaded guilty to mail fraud and filing a false 1997 income tax return. The mail fraud count stemmed from the charity's bingo license applications, in which Cain failed to report the diverted revenues.

The national charity helps communities raise funds for children who need organ or tissue transplants. In the mid-'90s, its thrice-weekly bingo games were one of the largest bingo operations in the state, reporting $5.2 million in gross revenues in 1997 and earning the charity $862,000.

The group ended the bingo fund-raisers immediately after the FBI began investigating the games in 1998. Cain also resigned as board chairman and chief executive officer.

Cain told investigators he paid himself about $200 for each of the 381 bingo games the group held from Jan. 1, 1996, to May 18, 1998. Cain's lawyer, Richard Kiefer, said other funds were diverted to pay the people who ran the games.

Assistant U.S. Attorney Joe H. Vaughn said Cain was the only person charged in the investigation.

Cain founded the charity in 1986 to raise funds for a 2-year-old boy who needed a liver transplant. Kiefer said Cain received "no pay whatsoever" as he crisscrossed the country during the next 10 years to help organize community fund-raising drives for children needing transplants.

In 1989, Cain received a national Jefferson Award from the American Institute for Public Service. The ceremony was held in the U.S. Supreme Court building.

He was also an Indiana Jefferson Award winner, in a contest sponsored by The Indianapolis Star.

Call Terry Horne at 1-317-444-6082.

Copyright © 2002 The Indianapolis Star.

This article posted June 29, 2002.