Fraudulent Fundraisers? That’s What Cuomo Alleges

Four professional fundraising companies have been charged by New York State Attorney General Andrew Cuomo with lying, manipulating, and deceiving to get charitable donations. During telemarketing calls, Cuomo contends, these four companies “consistently violated New York laws by disguising their status as paid professional fundraisers and lying about the programs that the donations would support.” 

The lawsuits allege that the four companies – Caring People Enterprises, Inc., Marketing Squad, Inc., Stage Door Music Productions, Inc., and Suffolk Productions, Inc. – have collectively reported raising $16 million over the past three years. On average, the government alleges, they keep 76 percent of the funds raised.
 
As part of the Attorney General’s investigation, undercover investigators secured jobs with fundraising companies, where they were trained to carry out fraudulent practices and where they observed employees making false statements to the public during phone solicitations.
 
The investigation revealed that at times the telemarketers:
 
-          Used aliases and illegally failed to disclose that they were paid fundraisers to make it seem that donors were giving directly to a charity
-          Changed the names of charities so they sounded similar to well-known charities or causes, and were thus more appealing to donors
-          Lied about the programs client charities actually provided
-          Created the false impression that they were law enforcement officials
-          Filed false annual documents with the Attorney General’s office containing fake scripts that were made to seem like the ones used by their telemarketers; however, telemarketers actually ignore the scripts and engage in deceptive practices
 
Cuomo’s lawsuits seek to shut down the companies, cancel their registrations as professional fundraisers, and prevent them from further soliciting the public. The lawsuits also seek penalties and restitution.
 
The cases are being handled by Assistant Attorneys General Alan Berkowitz, Benjamin Bruce, Nathan Courtney, and Patricia Northrop, under the supervision of Charities Bureau Chief Jason Lilien, Senior Trial Counsel Kathryn Diaz, and Deputy Attorney General for Social Justice James Rogers.