DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller announced on Friday that he is seeking an injunction against a Michigan fundraiser accused of violating Iowa's Consumer Fraud Act.
Associated Community Services, based in Southfield, Mich., allegedly solicited Iowans on behalf of an organization called "Vietnam Veterans of Iowa Inc." ACS also allegedly failed to inform those it called that it is a fundraising company.
"We allege this professional fundraiser simply wasn't being straight with Iowans," Miller said. "Our recorded phone calls reveal that the company was not up front about who was calling, and exactly where Iowans' donations were going."
On a recorded call from April, Miller says, an ACS caller tells a possible donor that, "All the money stays local for the veterans here in Iowa." Miller alleges that 80 percent of all money donated winds up at ACS. His lawsuit further alleges that the company set up a mail-drop in Des Moines to trick donors into thinking the money was being directed in state.
This isn't the first time ACS has been accused of deceptive practices. Since 2008, five other states have filed action against the company over similar violations of state consumer laws and regulations or for engaging in misleading or deceptive actions.
"This company has had numerous run-ins with law enforcement and should know the law," Miller said. "We assert that ACS is providing financial incentives to its solicitors who, in turn, deceive Iowans to collect a quick buck. And only a fraction of each donated dollar is making it to those who need it."
Miller is seeking an injunction against ACS to prohibit future violations, as well as a $40,000 civil penalty for each violation of the Consumer Fraud Act. Miller also seeks an additional $5,000 for each violation of the Consumer Fraud Act that targeted seniors, who are disproportionately represented in ACS's solicitations.