Oregon Department of Justice

Attorney General Ellen F. Rosenblum

Oregon Department of Justice - Attorney General Ellen F. Rosenblum
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AGREEMENT RESOLVES ACTION AGAINST VETERANS CHARITY AND TELEMARKETER

October 27, 2011

The organization agrees to follow procedures to make sure donations are spent for charitable purposes and the telemarketer has agreed to stop soliciting Oregonians

The Oregon Department of Justice today announced an agreement that resolves accusations of misconduct against an Oregon-based veterans charity and its for-profit telemarketer.

"It is extremely important that charities be properly managed, that they do not deceive donors and that the telemarketers they hire follow the law," said Attorney General John Kroger.

The agreement announced today stems from a 2010 lawsuit against Veterans of Oregon & Members of the Community (VOMC) and the organization's telemarketer, Associated Community Services, Inc. (ACS). The allegations included violating Oregon's no-call law and misleading donors about how their contributions would be spent.

VOMC Director John Neuman cannot serve as director of the organization for two years. The VOMC board agrees to new procedures that will insure that donations are spent for actual charitable purposes. Before contracting with a telemarketer, the board must obtain proposals from at least three different firms. VOMC has agreed to restrict any telemarketer from using the organization's donor information for commercial purposes. In addition, the full board will review all scripts and written materials provided to donors and will not approve solicitations that fail to describe the primary purposes for which donations will be used or that are otherwise not accurate. The organization will adopt an annual budget and closely monitor travel requests and expenses.

ACS in May resolved allegations of misconduct by paying $40,000 and agreeing to refrain from soliciting donations in Oregon on behalf of any nonprofit client until December 31, 2013. After that time, ACS is prohibited from fundraising for any charity unless it files documents with the Attorney General demonstrating that it will comply with applicable law. ACS is also prohibited from making false or misleading statements about how donations will be used and must clearly disclose its status as a professional fundraiser.

Among other things, DOJ's lawsuit alleged that ACS and VOMC told donors that contributions would be used to help homeless veterans or veterans with medical needs. In fact, after VOMC paid ACS 80% of the donations received, VOMC used much of the small fraction of remaining funds not on homeless veterans, but to pay the expenses of VOMC's directors and others as they travelled the state awarding medals.

In addition to misrepresenting how charitable donations would be used, the lawsuit alleged that ACS violated state law governing telephone solicitations. Oregon statutes prohibit charities and their fundraisers from calling phone numbers listed on the federal Do Not Call Registry, with limited exceptions. However, the Department's complaint alleged that ACS called numbers on the federal registry as well as Oregonians who expressed a desire not to be called.

The Attorney General is responsible for supervising and regulating the activities of charitable organizations in Oregon. Today's announcement is part of an ongoing effort by the Department of Justice to crack down on questionable charities and fundraisers that exploit public sympathy for veterans, children and law enforcement personnel.

Assistant Attorney General Heather Weigler and Senior Assistant Attorney General Elizabeth Grant handled the case for the Oregon Department of Justice Charitable Activities Section.

Attorney General John Kroger leads the Oregon Department of Justice. The Department's mission is to fight crime and fraud, protect the environment, improve child welfare, promote a positive business climate, and defend the rights of all Oregonians.

Contact:

Tony Green, (503) 378-6002 tony.green@doj.state.or.us |
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