Concord, NH – Deputy Attorney General Jane E. Young announces that the State of New Hampshire, along with the Federal Trade Commission (FTC) and 46 agencies from 38 states and the District of Columbia, has stopped a massive telefunding operation affecting 67 million consumers with 1.3 billion deceptive charitable fundraising calls that were mostly illegal robocalls. The defendants collected more than $110 million using their deceptive solicitations. Associated Community Services (ACS) and a number of related defendants, including Central Processing Services, Community Services Appeal, Directele, and the Dale Corporation and their owners, have agreed to settle charges by the FTC and state agencies for soliciting individuals to donate to charities but failed to provide the services they promised.

According to the complaint, which has been filed in the U.S. District Court for the Eastern District of Michigan, the defendants knew that the organizations for which they were fundraising spent little or no money on the charitable causes they claimed to support – in some cases as little as one-tenth of one percent. The defendants kept as much 90 cents of every dollar they solicited from donors on behalf of the charities.

The complaint alleges that the defendants made their deceptive pitches since at least 2008 on behalf of numerous organizations that claimed to support homeless veterans, victims of house fires, breast cancer patients, children with autism, and other causes that well-meaning Americans were enticed to support through the defendants' high-pressure tactics. ACS was also the major fundraiser for the Cancer Fund charities that were shut down by the FTC and states in 2015.

The complaint alleges the defendants violated New Hampshire laws pertaining to charitable trusts and charitable solicitations, New Hampshire consumer protection laws, the FTC Act, the TSR, and numerous other state laws. The complaint also alleges that ACS and Directele knowingly violated the Telemarketing Sales Rule (TSR) by using soundboard technology in telemarketing calls. With that technology, an operator plays pre-recorded messages to consumers instead of speaking with them naturally. In addition, the complaint charges ACS with making harassing calls, noting that ACS called more than 1.3 million phone numbers more than ten times in a single week and 7.8 million numbers more than twice in an hour. With respect to ACS calls to New Hampshire, the evidence shows that ACS made 9,596,014 total calls into the state, 402,442 of which were to unique numbers and that ACS called 2,342 unique numbers in New Hampshire more than 100 times per year.

Under the terms of the settlements, which are now pending approval, among other things, the defendants will be permanently prohibited from any fundraising work or consulting on behalf of any charitable organization or any nonprofit organization that claims to work on behalf of causes similar to those outlined in the complaint. Most of the defendants are also subject to monetary judgments of over $110 million, which in whole or in part, are suspended due to the defendants' inability to pay. Any funds surrendered by the defendants will be paid to an escrow fund held by the State of Florida and, following a motion by the participating states and approval by the court, will be contributed to one or more legitimate charities that support causes similar to those for which the defendants solicited.

Resources for charitable giving:

• NH Attorney General's Charitable Trusts Unit: https://www.doj.nh.gov/charitable-trusts/donors-public.htm.
• The Federal Trade Commission tips on charitable giving, including how to spot illegitimate charities at https://ftc.gov/charity and how to notify the FTC about charity fraud, robocalls, and other consumer issues at https://reportfraud.ftc.gov.