Michelle Knuttila, the founder of the nonprofit HiCaliber Horse Rescue, spent thousands of donor dollars intended for rescuing and rehabilitating horses on late-night fast-food and bar tabs, mobile phone spy technology, Weight Watchers and other purchases from October 2013 to March 2015, according to financial documents provided to inewsource.
The money came out of one of HiCaliber’s PayPal accounts, an online payment system the Valley Center nonprofit used to solicit donations from around the U.S. and other countries.
Charities like HiCaliber must use all of their funds “in furtherance of its charitable purpose,” said nonprofit attorney Paul Dostart. Some of Knuttila’s purchases, such as restaurants and bars, may be legitimate, Dostart said.
But, he said, “If I were the attorney general or IRS … my first question is: How did this late night fast-food and bar tab relate to carrying out the company’s business?”
inewsource obtained HiCaliber’s PayPal transactions from San Diego County under a public records request. The data covered a nearly 18-month period and showed donor names and emails, vendor information, and account balances. The county said it forwarded the records to the District Attorney’s Office shortly after receiving them.
A spokesman for interim District Attorney Summer Stephan declined to comment or confirm an investigation of HiCaliber.
The Valley Center horse rescue is embroiled in allegations of fraud and animal abuse. Critics allege the nonprofit’s funds are being used for Knuttila’s personal expenses, and horses are being excessively euthanized without a veterinarian’s involvement. At least 10 local and state agencies are involved in investigating the nonprofit.
The Attorney General’s Office has prohibited HiCaliber from engaging “in any activity for which registration is required, including solicitation or disbursing of charitable assets” until it submits its 2016 financials to the state. The horse rescue’s PayPal account also is currently frozen.
Knuttila did not respond to an inewsource request for comment, but on March 2, inewsource interviewed her at the HiCaliber ranch. She was asked: “Are you, or have you ever, misused donor funds for your own personal gain or enrichment?”
“No,” Knuttila said.
”Not a dollar?” a reporter asked.
“No. No,” she said.
Detailed transactions
The PayPal records detail transaction dates, times, methods of payment and account balances; addresses and names of vendors; and identifiable donor information, including donation amounts. Most of the expenditures appear to be for items such as hay, veterinary bills and purchasing horses. In all, according to the records, HiCaliber spent more than $90,000.
The records show trips to sushi spots and Starbucks in Escondido, four months of payments to Weight Watchers International, purchases at Barnes & Noble and a payment to SMS SPY, a company that specializes in mobile phone spy technology.
“To be eavesdropping on people’s telephone conversations, there are a multitude of criminal statutes that deal with that,” Dostart said. “Holy cow, that’s bad.”
More than $1,600 in cash also was withdrawn from ATMs, including one on El Cajon Boulevard in San Diego on a Thursday morning in October 2014.
Though Knuttila did not respond to email and phone requests for comment from inewsource, she did go on Facebook Live Thursday to address this story and its findings. She said the spyware was installed on her own computer to catch a board member stealing documents; that she mistakenly used the company debit card for Weight Watchers payments but reimbursed the organization afterward; and that restaurant charges were for taking out volunteers for appreciation.
Knuttila added that “the paper trail is solid” and explains the reimbursements.
“I have no fear whatsoever with any of the allegations being made. I’m not going to make an apology for taking volunteers to dinner. I’m not going to make an apology for taking another organization out for drinks to ask what works for you.”
HiCaliber has a strong social media presence and raises money through Facebook donations, PayPal, Venmo, sales of merchandise and a variety of other avenues both online and in-person.
Local and state agencies investigating HiCaliber include the California Veterinary Medical Board and Attorney General’s Office, the San Diego County District Attorney’s Office, the Inland Valley Humane Society and the Ontario Police Department.
In addition, three former board members told inewsource they never saw HiCaliber’s financials during their tenure. One submitted a complaint to the Internal Revenue Service. Another, a veterinarian, is working with the California Veterinary Medical Board in its investigation.
The Society for the Prevention of Cruelty to Animals Los Angeles visited HiCaliber on Jan. 2 and “closed their case after finding no evidence of animal cruelty or neglect,” according to emails obtained under the state’s public records law.
HiCaliber is bringing in more horses each week while at the same time trying to obtain a county permit that requires 100 or fewer horses on the property.
The county has observed that HiCaliber is “not taking steps to reduce the number of animals,” according to emails.
NOTE: This story was updated at 4:30 p.m. on March 15, 2018, with comments from Michelle Knuttila about the PayPal expenditures.
More in the series…
“HiCaliber volunteers say disease outbreak at Valley Center ranch not disclosed”
March 8, 2018
“Former board member and veterinarian details problems with finances, medical practices at HiCaliber Horse Rescue”
March 6, 2018
“Former HiCaliber board members distance themselves from horse rescue’s financials”
March 5, 2018
“Attorney General’s Office halts HiCaliber’s fundraising, spending for failing to file tax docs”
March 5, 2018
“Strong reaction to inewsource report on HiCaliber Horse Rescue”
March 3, 2018
“HiCaliber Horse Rescue ensnared in allegations of animal cruelty, fraud”
Feb. 28, 2018
We’ll let you know when big things happen.