State Sues Telemarketer For Veterans Charity
ST. PAUL, Minn. (WCCO) -- Minnesotans have a rich history of generosity, giving some $4 billion a year to various charities.
But on Wednesday, one charity that promises to help needy veterans is feeling the pinch of a state lawsuit. That's because the telemarketing company used to solicit donations is being sued for its unlawful tactics.
After proudly serving their country, too many military veterans end up poor and homeless. The Michigan-based charity Foundation for American Veterans solicits monetary donations from the public to help them out.
"Many people want to donate to help the veterans, but they want to know that they are being solicited truthfully and money is being spent wisely," Minnesota Attorney General Lori Swanson said.
Swanson says the telemarketing company used to appeal for donations was lining its own pockets. According to the state, Associated Community Services (ACS) was keeping 85 cents of every dollar donated, leaving just a small fraction of the money for the actual charity. Since 2011, ACS collected more than $929,000 from some 28,000 Minnesota donors who were contacted.
"And only about 10 percent of the monetary donations go to the ostensible charitable mission of helping veterans," Swanson said.
But it's the way ACS telemarketers go about appealing for support that bothers former veterans, like Harlan Gunter.
"It's a sin," he said.
Gunter was surrounded Wednesday morning by others who were similarly pressed for donations, and who now support the state's lawsuit.
"The veterans and their families have been taken to the cleaners by this kind of person -- organization -- and I'm not going to be one of them," he said.
Others say operators used deceptive tactics, sent out falsified pledges which they later called on to collect, and even made some like Brenda Nash feel guilty for not donating.
"He said, 'Don't you appreciate all veterans have done for you?' I said, 'Absolutely,'" she said. "Then for these phone calls to end I need to secure donation by credit card."
The suit also alleges ACS was breaking the law by deceiving donors into thinking they were speaking to the actual charity -- not a paid telemarketer.
The state wants an immediate injunction, as well as monetary damages including civil penalties and legal fees. There is a general rule of thumb which recommends that no more than 35 percent of donations be spent on administration and overhead.
There are also several charity review groups that can help prospective donors determine what that percentage is.
For more help, the Attorney General's website has additional information on laws governing charities. For more about the Charities Review Council, visit them online.
