(DES MOINES, Iowa) Attorney General Tom Miller on Wednesday alleged that a Florida-based professional fundraiser deceived Iowans to generate donations for various non-profit clients. In a consumer fraud lawsuit filed in Polk County District Court against Courtesy Health Watch Inc. (“CHW”), a for-profit company headquartered in Fort Lauderdale, Florida, Miller alleged that CHW:
- obscured or exaggerated how much of a donation goes to the worthy cause or gets used in the consumer’s own community;
- misled Iowans by insinuating that the caller is directly associated with the charity, rather than employed by a telemarketing company;
- told a would-be donor that other consumers typically donate higher amounts than the $20 that is in fact most commonly donated;
- told would-be donors that making a donation would halt future solicitation calls, when donations actually triggered an increase in additional solicitations.
“This lawsuit alleges that Courtesy Health Watch exhibits a pattern of deceptive solicitations, sometimes calling individual Iowans again and again to make donations despite assurances that they make calls only once a year,” Miller said. “Our undercover phone line caught these telemarketers in the act, revealing what we allege to be a variety of misleading claims.”
The lawsuit included detailed allegations about how an initial donation to one of CHW’s charity clients resulted in a succession of solicitation calls on behalf of several other clients, although a prospective donor is never told that a donation will trigger so many additional calls. The suit also alleges that telemarketers tell donors the opposite, namely that making a donation will turn off the calls, rather than increase them.
Miller said that Iowans of retirement age are particularly affected by these practices. “The lawsuit alleges that Courtesy Health Watch made repeated solicitation calls to an 82-year-old Keokuk woman on behalf of its various charity clients,” Miller said. “We allege that they called her about once a month over a three year period. We’re concerned that this escalation of contacts could drain the resources of Iowans whose advanced age may make them vulnerable.”
The lawsuit included transcripts of several calls and one recording captured on an undercover phone line maintained by the Consumer Protection Division. The suit indicated that CHW telemarketers who thought they were calling an Iowa woman were actually speaking with an employee of the Consumer Protection Division, who was recording the call.
Audio of July, 2012 solicitation call to Consumer Protection Division undercover phone line:
The non-profits on behalf of which CHW solicits donations from Iowans include: National Cancer Coalition, Children’s Leukemia Research Association, Childhood Cancer Research Coalition, Miracle Flights for Kids, National Wheelchair Basketball, Organ Donation and Transplant Association, and Breast Cancer Relief Foundation, a program of Cancer Center for Detection and Prevention, Inc. The lawsuit indicated that the fundraising contracts typically provided that the charity would receive at least 10 to 15 percent of the money donated, and that the actual amount received had not exceeded 30 percent for any of the charities.
The lawsuit asks the court to prohibit CHW from making any more deceptive calls to Iowans, and to require the company to pay civil penalties and attorney fees.
Tips for avoiding charity fraud and making the most of your donations:
- Ask questions. Be wary of claims that the caller is a charity worker or volunteer, that most of your donation goes to the cause, or that your donation will be used locally.
- Don’t let a sympathetic charity name fool you – some fundraisers exaggerate or fabricate their support for veterans or military families, law enforcement, fire fighters, victims of disease, and children’s causes.
- Ask phone solicitors to send written information. Be suspicious if they insist on a pledge before they’ll send you information. Check them out at the national Better Business Bureau “wise giving” site – www.give.org.
- Don’t give your credit card or checking account numbers over the phone to someone you don’t know.
- Give directly to a known charity of your choice.
- Bottom line: Keep giving generously, but give wisely. Giving to a known charity you’re confident about is often the best option.
If you think you have been cheated by a fundraising scheme, contact the Attorney General’s Consumer Protection Division, Hoover Building, Des Moines, Iowa 50319. Call 515-281-5926, or 888-777-4590 toll free. Web site: www.IowaAttorneyGeneral.gov.