A receiver was appointed this morning to oversee the operations of the Colorado Humane Society, which has been the focus of an ongoing state investigation for more than a year.
Denver’s Waverton Group, described as a professional receiver, will have sole control of the Colorado Humane Society and its assets, including all its sheltered animals.
The motion, filed by Colorado Attorney General John Suthers in Arapahoe County Court this morning, immediately removes Mary C. Warren, her husband Robert Warren, and Mary Warren’s daughter, Stephenie L. Gardner, and bars them from any control of its assets.
“My No. 1 priority when we filed this case was to appoint new management for the Colorado Humane Society as soon as was legally possible,” said Suthers. “This court order will help to protect this important shelter space while the receiver works to re-establish the charity’s good name.”
Mary Warren was the society’s executive director; Robert Warren, development director; and Stephenie Gardner, director of operations.
When he filed suit against the organization last week, Suthers claimed the Colorado Humane Society failed to register the society under the state’s Charitable Solicitations Act.
This caused “CHS to collect nearly $3 million in donations illegally,” the attorney general’s office claimed.
Suthers said today that the defendants have voluntarily agreed to the stipulation that grants the receivership to Waverton, which was selected by the state. Waverton is headed by Richard A. Block, a lawyer and financial expert who has handled complex receiverships for 16 years.
As part of the stipulation, a temporary injunction has been granted that requires the Warrens and their daughter to give up CHS assets in their possession, prevents them from withdrawing any funds from the society’s bank account and bars them from holding themselves out as humane society representatives.
It also prohibits them from interfering with the ongoing operation of the charity.
Suthers said that the Colorado Humane Society, under the receivership’s direction, will continue to operate.
“We are pleased that the Colorado Humane Society will continue to function while the case against its former management proceeds,” Suthers said. “This is a good result for Colorado, for the animals in the care of CHS, and more importantly, for public trust in charitable institutions.”
Waverton was ordered to take immediate control of the humane society and to hire employees to operate and manage the humane society facility. The order permits the receiver to retain or terminate the current CHS employees and volunteers as he sees fit.
In the suit filed last week against the Warrens and Gardner, Suthers alleged that the charity’s top managers diverted thousands of dollars of contributions for personal use.
Suthers also alleges that approximately $32,000 of the $66,154 the society received in donations for helping animals affected by Hurricane Katrina were spent to cover the charity’s own payroll.
The civil lawsuit, filed in Arapahoe County, accuses the Warrens and Gardner of “gross mismanagement of CHS finances.”
“Individual defendants have co-mingled CHS finances with their own personal finances to an extent that the integrity of CHS finances has been brought into question,” the suit claims.
The Colorado Humane Society’s work dates to 1881.
Robert Warren told The Denver Post last week he was not not prepared to comment on the lawsuit. In entering the stipulated order, the Warrens and Gardner admitted to no wrongdoing.
Nate Strauch, spokesman for the attorney general, said that the investigation of the organization took 14 months and was “very complicated and very time-consuming.”
The investigation was carried out by the attorney general’s Consumer Fraud Division, he said.
The lawsuit is a civil case. The attorney general cannot file criminal charges because it has no jurisdiction to do so, said Strauch.
The civil suit claims that the Warrens made regular and repeated misrepresentations regarding the Colorado Humane Society’s euthanasia policies and euthanasia rates in an effort to encourage donations to the society rather than to other animal shelters with allegedly higher euthanasia rates.
Although claiming at times that it operated as a “no-kill” shelter, the fact is that the charity had a euthanasia policy and was committed to euthanasia, the lawsuit alleged.
“Mary Warren would regularly select animals for euthanasia that were not otherwise gravely ill or injured, of advanced age and infirm or aggressive, to make room at the shelter for more ‘adoptable’ animals,” Suthers alleged.
The Colorado Humane Society would regularly initiate and accept transfers of animals from other shelters when the society’s own shelter space was full. To make room for the new animals — normally puppies and younger dogs — Mary Warren and Stephenie Gardner would select dogs to be euthanized. They would normally select larger dogs for euthanasia because one kennel could house six or seven smaller dogs, but could only accommodate one or two larger dogs, investigators alleged.
Although the humane society claimed that less than 8 percent of the total number of animals in its shelters were euthanized, the actual rate in the past five years has been as high as 29 percent, said investigators. The suit says the society falsely reported the number of animals adopted to new owners, returned to owners, transferred to other licensed facilities and euthanized.
This was all done, the attorney general claimed, to “artificially maintain the organization’s claimed euthanasia rate.”
The suit alleges that the Colorado Humane Society didn’t pay its bills to its pet cremation services and that when CHS freezers for storing dead animals were full, the employees “were forced to dispose of euthanized animals in a Dumpster behind the CHS facility.”
Howard Pankratz: 303-954-1939 or hpankratz@denverpost.com
