DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller announced on Monday that a professional fundraising company has agreed to pay a $15,000 fine and change how it solicits donations.
The Sherwood, Ark.-based The Heritage Company allegedly made calls to Iowa residents obscuring its role as a professional fundraiser and allegedly misrepresented the amount of donations that would go to the charities it said it represented.
"Although we caught some troubling solicitation practices on our undercover phone line, Heritage acted responsibly in addressing our concerns," Miller said.
As part of a settlement, Heritage may continue soliciting charitable donations in the state, but its telephone sales representatives will no longer be allowed to misrepresent the company in any way.
Although the company denied any wrongdoing or liability, Heritage agreed to pay the state $15,000 and agreed that a violation of the agreement would be a violation of the Consumer Fraud Act. The company could face a $40,000 civil penalty in the future if it violates the agreement.
Heritage also agreed that, for all future telephone solicitations, it would require its solicitors to stop saying or implying that they volunteer or are employed for an organization that they are seeking funds for.
The solicitors must also make it known that they are making a fundraising request, must clearly state the name of the fundraising company and provide truthful information about how much of any donation would go to the charity.
Heritage's telephone solicitors must also refrain from implying that a donation will provide more of a local benefit than it really will.
To show that they are compliant with the agreement, Heritage will record a sample of its telephone solicitations and offer them to Miller's office upon request.
Heritage will also make any financial incentives paid to phone solicitors, including commissions, linked to compliance with the agreement and Iowa laws, instead of being based only on the amount of donations generated.