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The Honolulu Advertiser
Posted on: Thursday, May 21, 2009

Charity telemarketer settles over state law violations

Advertiser Staff

Hawai'i Attorney General Mark Bennett has joined the Federal Trade Commission and 60 attorneys general, secretaries of state and law enforcement officials from 48 states and the District of Columbia in a crackdown on fraudulent charitable solicitations and charities claiming to help police, firefighters and veterans.

Operation False Charity has resulted in a settlement between solicitor/telemarketer Community Support Inc. and at least 35 states.

CSI, based in Milwaukee, solicits funds from residents in Hawai'i and almost every other state on behalf of more than 35 charitable clients. In general, CSI kept no less than 83 percent of the money it collected on behalf of the charities. In many contracts, CSI kept 90 percent of the money.

Bennett's office says CSI consistently violated Hawai'i law. It alleged that CSI often misrepresented how much of the funds would actually go to the charity, misrepresented what would be spent in the local community, harassed call recipients, allowed its callers to falsely claim to be law enforcement officers or veterans, and falsely claimed a person had made a pledge.

In settling, CSI agreed to cease illegal and objectionable tactics and regularly report information to states. Violations of the agreement may result in penalties of $10,000 per violation. CSI also agreed to reimburse the states $200,000 for the cost of their investigation.