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April 16, 2013

Judge Bars Iowa Telemarketer from Iowa Fundraising

Telemarketer "outright lied" in pitch intended for older Iowan captured on undercover consumer protection line, according to Miller

(DES MOINES, Iowa)  A Polk County judge Monday barred an Osceola-based telemarketing company and its operators from professional fundraising in Iowa, after a state undercover phone line recorded what Attorney General Tom Miller called a “highly deceptive pitch” from a for-profit company that claimed it was raising money to grant the wishes of terminally ill Iowa children.

In July the Consumer Protection Division’s undercover phone line recorded a representative of Telequal LLC attempting to solicit money on behalf of “A Child’s Dream Foundation,” a Knoxville, Tennessee non-profit organization.

[Click here for the recording; click here for the transcript.]

The intended recipient of the call is a 73-year-old widow with Alzheimer’s disease who had given money in the past.  The woman’s family had previously changed her phone number and consented to forwarding calls placed to her old number to the Consumer Protection Division’s undercover phone line.  A Consumer Protection Division staff member posed as the woman on the call.

The Telequal representative “outright lied” in the call, Miller said.  “She said she was calling from the charity, claimed that the charity focused primarily on sick Iowa kids, and also claimed that a lot of each donation went to the kids,” Miller said.  “In truth, the call was coming from Telequal.  They were asking for money for an out of state charity that has no special Iowa focus, and 85% of every dollar donated went to the telemarketer, not to sick kids.”

After recording the solicitation, a Consumer Protection Division investigator interviewed Telequal ex-employees, who confirmed that similar deceptions were routine.  Shortly before Miller planned to file a consumer fraud lawsuit, the business began to shut down.  In signing the consent judgment that finalizes the shutdown, the defendants denied wrongdoing.

In addition to Osceola-based Telequal, the consent judgment also named four Osceola residents, including its owner, Travis J. Held, 36, Amanda D. Held, 41, and Telequal employees Jeffrey J. Jones, 42, and Jennifer L. Jones, 42.

“Our Consumer Protection Division staff has long viewed Telequal as a legally marginal operation, at best, and our recent investigation confirmed that deceptive fundraising pitches were commonplace among Telequal’s telemarketers,” Miller said.

“This court order gives the company and its principals no wiggle room in opening up shop again in Iowa,” Miller added.  According to the order, Telequal and the other defendants are prohibited from moving operations to another state and then calling into Iowa.  The defendants are also barred from ever using any of Telequal’s donor information again, including the names of Telequal’s out-of-state donors.

“We don’t have jurisdiction to prevent these operators from starting from scratch in another state,” Miller said.  “But if they do, this court order forbids them from using any donor information generated by Telequal’s Iowa operation.  And they can’t make a single solicitation call to Iowa.”

The Telequal case is the third time in the past three years that Miller’s office has shut down an Iowa telemarketing operation for allegedly deceptive practices.  In each instance, Miller added, undercover phone line recordings were key.

“Iowa has a great workforce, and it’s a place where legitimate businesses can and do thrive,” Miller said.  “But our state will not harbor deceptive telemarketing operations that prey upon people here in Iowa or any other state.”

Giving Wisely
Miller reminds Iowans to give, but to give wisely by being aware of charity fraud.  Be leery of a sympathetic name or sales pitch, ask specific questions about how the organization spends its money, and request written information.

There are many excellent charities soliciting contributions in Iowa, and the Consumer Protection Division targets fundraising abuses and upholds the integrity of our system of giving.

If you think you or a loved one may have been cheated by a fundraising scheme, contact the Attorney General's Consumer Protection Division through the Attorney General’s website.  You can also call us at 515-281-5926, or toll-free at 888-777-4590.  Or write us at the Office of the Attorney General Consumer Protection Division, Hoover Building, Des Moines, Iowa 50319.


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