HARRISBURG – Attorney General Tom Corbett announced that a Montgomery County-based telemarketing company and its officials will pay $62,500 in restitution, fines and costs resolving a lawsuit that accused the defendants of using illegal and deceptive tactics in raising thousands of dollars for various private non-profit fraternal organizations.
Corbett said the funds are part of a Consent Decree between the Attorney General’s Charitable Trusts and Organizations Section and Fiesta Publications Inc., 1840 County Line Road., Huntingdon Valley, Montgomery County, along with company executives Wayne Rubenstein and his brother Mark Rubenstein. The consent resolves a May 2003 lawsuit that accused the defendants of violating Pennsylvania’s Charities Act.
The commonwealth had alleged that the defendants through 2002 were hired to raise money for several fraternal organizations by contacting mostly Southeastern Pennsylvania businesses to solicit donations or sell advertising space in the organizations’ yearbooks or publications. The fraternal organizations’ members are active and/or retired police, detective, fire personnel and prison guards.
The lawsuit followed complaints from several businesses who felt that they were misled by the defendants. The suit accused the defendants of deceiving potential donors by falsely claiming that:
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They were affiliated with local law enforcement or public safety groups, when in reality the callers were paid telemarketers.
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They were raising money to benefit local law enforcement agencies, state police or public safety organizations, when in fact the majority of contributions were applied to fundraising expenses, with the remaining funds benefiting the groups’ membership.
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The business had already agreed to purchase an ad and that the payment was now due, when in fact the call was the first contact the defendants had with the business.
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Placing an ad in the various publications would mean local law enforcement or public safety personnel would frequent their particular business.
“This case underscores the need for potential donors to check on the actual group or organization before they make a contribution,” Corbett said. “It’s important to request specific information including the actual recipient of your donation, the exact uses for the funds and how much of your donation will go toward operating expenses verses the charitable mission.”
Under the terms of the consent, the defendants are required to:
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Pay $35,000 in restitution to be distributed to a charitable organization that best matches the mission described in the defendants’ solicitations.
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Pay $6,500 in civil penalties and $21,000 in investigation costs.
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Cease any deceptive, misleading or false representations in the course of conducting fund raising activities.
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Institute a training program for all independent contractors working as telemarketers to ensure compliance with the Charities Act in future solicitations.
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Immediately identify themselves on the telephone and on written invoices as paid professional fund-raisers soliciting or collecting charitable donations.
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Maintain a “do not call” list for all telemarketing campaigns to include the names of those who do not wish to be solicited in the future.
The groups that had hired Fiesta Publications to conduct their fund-raising activities include: Pennsylvania Police Officers Association; County and State Detectives Association of Pennsylvania; Montgomery County Volunteer Fire Police Association; Montgomery County Fireman’s Association; The Emerald Society; Lehigh-Northampton Fire Fighters Local 2227; Pennsylvania Fire Police Association; Retired Police, Fireman & Prison Guards, and Police Chiefs Association of Southeastern Pennsylvania.
The consent was approved by Commonwealth Court. The legal action was led by Senior Deputy Attorney General Mary C. Kenney of the Attorney General’s Charitable Trusts and Organizations Section in Philadelphia.