Herring shuts down massive charity fraud telefunding operation, more than 40.3 million deceptive calls made to Virginians

Richmond
Mark Herring_449205

Virginia Attorney General, Mark Herring, speaks during a news conference at the Capitol in Richmond, Va., Thursday, Dec. 15, 2016. McAuliffe and Herring announced proposed $50 million settlement to resolve claims stemming from the release of mercury from the former E.I. du Pont de Nemours and Company (DuPont) facility in Waynesboro, Virginia (AP Photo/Steve Helber)

RICHMOND, Va. (WAVY) — Attorney General Mark R. Herring’s office announced he has shut down a massive telefunding operation.

The operation “bombarded 67 million consumers with over 1.3 billion deceptive charitable fundraising calls – mostly illegal robocalls – over 40.3 million of which were made to Virginians,” according to a statement released Thursday.

“ACS [Associated Community Services] and its affiliates facilitated widespread fraud on behalf of numerous purported charitable organizations and used technology to repeatedly harass Virginians with millions of illegal phone calls, including robocalls,” said Herring. 

The defendants collected more than $110 million using their deceptive solicitations.

“I’m pleased my Consumer Protection Section and I were able to help shut down this massive illegal operation, stop the perpetrators from being able to engage in this kind of egregious conduct going forward, and recover money that can now go to legitimate charitable causes. I also want to thank our state and federal partners for their partnership and hard work on this case,” Herring continued.

Herring and his colleagues allege in the complaint that the defendants have been making these false phone calls and pitches at least 2008.

They would call 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 sham Cancer Fund charities that were shut down by Attorney General Herring, the FTC, 49 other states, and the District of Columbia in 2015. Herring joined the Federal Trade Commission (FTC) and 46 agencies from 38 states and the District of Columbia in stopping the massive operation.

ACS and a number of related defendants agreed to settle charges by the FTC and state agencies that they duped generous Americans into donating to charities that failed to provide the services they promised. 

The complaint names are ACS and its sister companies Central Processing Services and Community Services Appeal; their owners, Dick Cole, Bill Burland, Barbara Cole, and Amy Burland; and ACS senior managers Nikole Gilstorf, Tony Lia, John Lucidi, and Scot Stepek. In addition, the complaint names two fundraising companies allegedly operated by Gilstorf and Lia as spin-offs of ACS, Directele and The Dale Corporation.

The complaint also 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. More than 500 phone numbers were even called 5,000 times or more.

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