Judge issues temporary injunction in one case, and a separate injunction request is pending, against misleading sales pitches after Miller files consumer fraud lawsuits against telemarketing operations
(DES MOINES, Iowa) A Polk County judge has temporarily barred a Phoenix-based telemarketing company and its owners from using misleading sales pitches that emphasize help to the disabled or disadvantaged, and a request for an injunction is pending against another company, after Attorney General Tom Miller filed separate consumer fraud lawsuits against each company.
Yesterday, District Court Judge Douglas F. Staskal ordered Advanced Employment Solutions, LLC (AES), its owner Ann Marie Scott, 73, and its general manager, Mila D. Sprague, 56, both of Phoenix, to refrain from making misleading calls to Iowans while their case is pending.
The Consumer Protection Division is seeking a temporary injunction against American Handicapped & Disadvantaged Workers Inc. (AHDW) and its owner, Adli Najib Dasuqi, 61, who has recently listed addresses in Waterford, Michigan and Scottsdale, Arizona, to refrain from making misleading calls to Iowans while the case is pending.
Miller said that although these two operations were evidently independent of one another, they engaged in similar deceptions to generate sales over the phone.
“We see a lot of telemarketing abuses in the name of helping worthy causes, but these two stand out,” Miller said. “Both of these operations and their telemarketers lace aggressive sales pitches with false claims, and they both play on peoples’ emotions.”
American Handicapped & Disadvantaged Workers Inc. (AHDW)
Miller’s lawsuit against AHDW, a for-profit company with offices in Arizona, California, and Michigan, alleges that the operation sells light bulbs, trash bags, and other household items using telephone sales pitches in which callers identify themselves as “handicapped.” The suit accuses AHDW of misleading Iowans about the callers’ disabilities and using manipulative and unfair tactics to get Iowans, especially older Iowans, to make repeated purchases at premium prices.
“We allege that this company targeted several older Iowans repeatedly, in one case persuading an Iowa senior to make three consecutive $200 purchases in less than five months,” Miller said. “And it appears a substantial amount of the money extracted from seniors through deception goes to the company owner, as opposed to people with true disabilities.”
Miller’s suit included a recording of one of three AHDW sales pitches recorded on the Consumer Protection Division’s undercover phone [click here for the audio]. The lawsuit alleged that the recorded pitches displayed a number of illegal attributes, including:
- Claims that callers are “handicapped” by severe physical conditions, when in fact their primary limitations may be a record of crime, addiction, or unemployment;
- Pressuring consumers by literally begging for help, and by saying that the caller hopes to earn a food voucher to help feed dependent family members;
- Falsely claiming that as much as 75% of the purchase money goes to cover the caller’s medical expenses or other needs;
- Misleading Iowans about what are the least expensive items, in order to extract more money with bigger purchases;
- Telling consumers that they’ll be contacted only once a year to help, when in fact a number of older customers were contacted three or four times a year.
According to the lawsuit, AHDW has been telemarketing since 1996, and Dasuqi, as president, CEO and sole owner, has profited substantially. The suit indicates that in one three-year period from 2008 through 2010 Dasuqi received more than $780,000 from AHDW, and that nationwide sales for 2009 exceeded $1.8 million.
Advanced Employment Solutions LLC (AES)
The lawsuit against AES, a for-profit Arizona operation, alleges that the company sells trash bags, kitchen items, Bibles and American flags using telephone pitches in which the callers falsely claim to be “handicapped veterans” or “disabled workers.” The suit alleged that these pitches were directed particularly to older Iowans.
“Our suit alleges that this company targeted one 92-year-old Iowa woman repeatedly over the course of about a year’s time,” Miller said. “If the sale pitches to her were like others we’re aware of, deception was at the root of the $900 the callers extracted from this Iowan.”
Miller’s suit against AES included a recording of one of three AES sales pitches recorded on the Consumer Protection Division’s undercover phone [click here for the audio]. The suit alleged that the recorded pitches and the company’s own scripts displayed a number of illegal hallmarks, including:
- The claim by one caller that he was a “handicapped veteran” of the Vietnam War, when in fact he had no disability and was born in 1980, long after the Vietnam War ended;
- Making groundless claims that a would-be donor’s deceased spouse had been a repeat supporter, and asking that another purchase be made in the spouse’s memory;
- Falsely claiming that as much as 50% of the operation’s proceeds goes to fight cancer;
- Misleading Iowans about which products cost the least, in order to prompt purchases that generate higher commissions;
- Telling consumers that they’ll be contacted only once a year to help, when in fact three to four calls a year was company policy.
How to handle phone calls asking for support
- Don’t be fooled by a sympathetic name. Some operations use names that promise more than they deliver. Many causes clearly deserve generous public support, including veterans, law enforcement, fire fighters, and people with disabilities, but some marginal operations claim connections with such groups yet provide them with very little support. Don’t be pressured into helping out until you have checked out a worthy-sounding organization.
- Show healthy skepticism. Be wary of claims that most of the money you send goes to a worthy cause, or that your donation will be used locally.
- Get it in writing. Check out the operation before you make a decision. Be suspicious if they insist on a pledge before they’ll send you information. Charities can be checked out at the national Better Business Bureau’s “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 wisely! Giving to a charity you know and trust is often the best option.
Older Iowans are frequent targets of deceptive telemarketers!
Older people often are the targets of fraudulent telemarketers who take advantage of the fact that many older people have assets, and some may be especially susceptible to sympathetic and aggressive sales pitches.
National Consumers League warning signs that an older person may be a fraud victim
If an older person is:
- receiving lots of junk mail for contests, “free” trips, prizes and sweepstakes,
- getting frequent calls from strangers offering valuable awards or great moneymaking opportunities, or asking for charitable contributions,
- making repeated and/or large payments to out-of-state companies,
- having payments picked up by private courier services,
- receiving lots of cheap items such as costume jewelry, small appliances, pens and pencils, beauty products, water filters, etc.,
- getting calls from organizations offering to recover money that they have paid to telemarketers, for a fee,
…then he or she may be a target of fraud.
Advice from the FBI
Seniors who are isolated and have little contact with family, friends, caseworkers, and other concerned parties may be at increased risk of being victimized by fraudulent businesses. Decreasing this isolation through police welfare monitoring, neighborhood watches, and in-person outreach efforts can help to ensure that elders are aware of available resources they can turn to with questions and concerns about potential scammers. Further, ongoing contact with family members can provide the means to monitor an elder’s financial matters.
There are many good charities soliciting contributions in Iowa, and the Office of the Attorney General upholds the integrity of our system of giving by stopping fundraising abuses. If you think you may have been cheated by a fundraising scheme, write to the Attorney General's Consumer Protection Division, Hoover Building, Des Moines, Iowa 50319. Call 515-281-5926, or 888-777-4590, toll free. The website is: www.IowaAttorneyGeneral.gov.