Attorney general reaches settlement with telemarketer
- January 17, 2012
Virginia has reached a settlement with the Michigan telemarketing company that raised money for a defunct charity.
Attorney General Ken Cuccinelli said Tuesday that Associated Community Services Inc. (ACS) will pay more than $65,000 in refunds and penalties in connection with a fundraising effort for the defunct United States Navy Veterans Association (USNVA).
USNVA claimed that it assisted disabled and needy war veterans and sent care packages to U.S. troops stationed overseas. A series of articles published in the St. Petersburg Times in 2010, however, questioned its legitimacy.
USNVA ceased operations by the end of June 2010 and its founding director, Bobby Thompson, disappeared amid allegations that USNVA was a fraud.
“The U.S. Navy Veterans Association defrauded people in the name of veterans, and this fraud diverted needed money from veterans’ charities,” Cuccinelli said in statement. “This office will continue to work with our law enforcement partners at the state, local, and federal levels to find ‘Bobby Thompson’ and any other cohorts, to ensure that those responsible are held accountable for what they have done.”
In its case against ACS, Cuccinelli’s office alleged that the telemarketing agency solicited Virginia residents after USNVA directed it to make calls in the commonwealth on its behalf.
The calls also allegedly violated a prohibition against soliciting on behalf of a charitable organization that is not registered with the commissioner of the Virginia Department of Agriculture and Consumer Services (VDACS).
The complaint also alleged ACS solicited contributions on behalf of USNVA and other charitable organizations without filing with the commissioner the required written authorization of the charitable organizations or the required solicitation notices for some of its solicitation campaigns.
The ACS settlement requires it to pay $16,780 to 812 Virginians, returning contributions made to USNVA in response to calls placed after Aug. 24, 2009. ACS already has returned uncashed checks and cash contributions totaling more than $32,500 to about 1,500 Virginians who made donations to USNVA.
The settlement also requires ACS to pay $9,052.50 to 485 Virginians, returning contributions made to Circle of Friends for American Veterans (doing business as American Homeless Veterans) when ACS had not filed a solicitation notice with the VDACS commissioner.
In addition, ACS must pay $25,000 in civil penalties for the alleged violations of soliciting law and $15,000 for reimbursement of the commonwealth’s expenses and attorney’s fees.
In agreeing to the settlement, ACS is not admitting to any admission of wrongdoing or violation Virginia law. ACS cooperated with the attorney general’s office throughout the investigation and maintains it was unaware of USNVA’s fraudulent actions.