§ 18630 Nonprofit Alter Ego Liability

• •People who control a nonprofit can be personally liable for its debts.
• •This rule applies even if other parts of the law say the nonprofit is separate.
• •The liability follows the same “alter ego” ideas used for corporations, but adjusted for nonprofits.

A charity group hires a caterer for a fundraiser and doesn't pay the bill. The board chair used the nonprofit’s bank account to pay personal expenses.

Because the board chair controlled the nonprofit and mixed personal and nonprofit money, the caterer can go after the chair personally for the unpaid bill.