N.J. Settles Suit Over Unregistered Hurricane Sandy Charity

A Sparta, N.J., couple will turn over $334,000 they raised for Hurricane Sandy victims to a court-appointed administrator as part of a settlement of a state lawsuit over their unregistered storm-relief charity, The Star-Ledger of Newark reports.

The settlement approved by a judge Friday also dissolves the Hurricane Sandy Relief Foundation and bars John Sandberg and Christina Terraccino from starting a new charity for two years. New Jersey officials sued the couple in February, in part over claims on the foundation’s Web site that it had charity and tax-exempt status when it had not yet registered with either New Jersey or the Internal Revenue Service.

The foundation has since secured 501(c)(3) status, meaning gifts to it, including those made before it was granted the charity designation, were tax-deductible.

The state said Mr. Sandberg and Ms. Terraccino raised hundreds of thousands of dollars in the wake of the storm but had given little to help victims and diverted some $13,000 to personal use. Under the settlement, the administrator will disburse the foundation’s remaining funds to Sandy groups in New Jersey and New York within five months.