Only $10,000 Spent on Youngsters : Charity Accused of Misusing Children’s ‘Dying Wish’ Funds

A charity that raised $237,000 last year to grant children their dying wishes spent only $10,000 for that purpose and used the rest for fund raising, salaries and luxuries, including renting a videotape player and X-rated movie, authorities said Thursday.

“The reality is (that) the dream has become a nightmare,” Atty. Gen. Joseph I. Lieberman said of the Genie Project.

‘Sex Games’ Movie

In a lawsuit aimed at closing the charity, Lieberman said that the money not spent on the children was used to pay the operators inflated salaries, hire a professional fund-raiser, buy jewelry and rent a car, a videotape player and a movie entitled “Sex Games.”

“In the three years I have been attorney general, I have not seen a case that has made me angrier,” Lieberman said.

The Genie Project was formed in October, 1982, by Michael and Suzanne Bates, a couple who said they got the idea after reading an article about a similar organization in a national magazine. The Genie Project was not affiliated with any national organization.

Francis M. Donnarumma, an attorney for the Bateses, said that there had been no effort to defraud the public or misuse charitable funds.

“The Genie Project has been run in a very public way,” Donnarumma said. “There should be no suggestion it was some sham or device created to divert funds. To the extent there is a problem, I think it’s going to be something--and I’m not even conceding this--arising from poor exercise of judgment.”

Lieberman said his investigation has convinced him otherwise.

“What kind of charity would take advantage of dying children for personal profit?” Lieberman asked at a news conference.

Helped 5 Children

Lieberman said his investigators found that only five children had been helped.

He said the Waterbury-based charity, which has received much favorable publicity, used at least $16,000 of the money it raised to give personal loans to its officers.

The state’s consumer protection commissioner, Mary M. Heslin, said that the group’s license to raise money has been revoked.