AG Shapiro shuts down charity telefunding scam that collected $110 million

Regional News

HARRISBURG, Pa. (WTAJ) — Attorney General Josh Shapiro announced a settlement in a press release regarding a fraudulent telefunding operation that made approximately 1.3 billion deceptive charitable fundraising calls since 2008.

The Associated Community Services (ACS) reached out to 67 million consumers across the nation, according to a release. In Pennsylvania, they made over 61 million calls from Jan. 1, 2016, to Aug. 31, 2019. It’s reported that in some instances, these people were called more than 10 times per week, three times per day or even multiple times an hour.

“ACS duped millions of Americans and took advantage of their generosity for its own financial gain,” Shapiro said in the release. “The settlement will ensure that this scam gets hung up on permanently, that the recovered money gets properly allocated, and that the shareholders of these companies are never able to prey on Pennsylvanians again.”

It’s reported that ACS collected more than $110 million using this deceptive method and spent as little as 0.1% on the charities they claimed to support, such as breast cancer patients, victims of house fires, children with autism and homeless veterans, among others.

Per the terms of the settlement, the shareholders of ACS and its related corporations are permanently banned from telemarketing.

The senior managers of ACS later formed Directele and the Dale Corporation (Dale), and they purchased donor lists from ACS. All of ACS’s fundraising clients were shifted over to Directele and Dale.

The settlement requires both Directele and Dale to cease and dissolve operations, and the shareholders will permanently be prohibited from engaging in charitable fundraising or soliciting for causes related for the ones they once represented.

According to the release, the individual shareholders of ACS are paying $450,000, and the individual shareholders of Directele are paying $50,000 for a total of $500,000.

The funds being surrendered by the defendants will be contributed to charities in areas affected by the telemarketing scams and will support causes similar to those for which the defendants solicited.

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