Iowa Attorney General sues telemarketer, alleges deception

A for-profit telemarketer based in Arizona was enjoined Tuesday from engaging in a variety of misleading sales practices that included making false claims by its solicitors that they were military veterans with physical disabilities, while none of the proceeds went to help homeless or disabled soldiers, according to the state Attorney General's office.

Iowa Attorney General Tom Miller said his office filed a consumer fraud lawsuit against Phoenix-based Action Point, LLC, owned by Robert Foster, alleging the company repeatedly made false claims that its telemarketers are disabled veterans in order to generate sales – including repeat sales targeting elderly Iowans – of high-priced consumer goods like light bulbs, trash bags, household cleaners and tins of cookies costing up to $50. He said one of the calls was recorded through his office's undercover telephone line, which tapes solicitation calls that telemarketers direct to cooperating elderly Iowans.

“We allege that Action Point telemarketers misrepresented themselves as seriously injured, even paralyzed veterans of the Iraq and Vietnam wars in order to touch Iowans' hearts and reach deeper into their pocketbooks,” he said. The AG's lawsuit claims most of the company's targets were elderly Iowans aged 65 or older who spent as much as $2,000 in response to the solicitations.

The attorney general's office has asked the court to make permanent the temporary court injunction that was issued Tuesday prohibiting Action Point from making any more deceptive calls to Iowans, as well as ordering the company to pay refunds to Iowa victims, civil penalties and attorney fees.

Miller said Action Point “doesn't claim to do anything for anybody else except themselves in terms of profits, not helping veterans, not helping homeless people. It's a for-profit company and they keep the money. I'm sure they're pretty steadfast in keeping the money.”

Miller contends Foster directly contradicted claims made by telemarketers regarding disabilities and military injuries. Foster allegedly acknowledged that no one involved in Action Point's operations is disabled and that none of the proceeds go to help the disabled, the attorney general told a news conference held in his office on Tuesday to warn Iowans about the potential for deceptive telephone solicitations attempting to prey on elderly and vulnerable Iowans.

“Ruses like this make it harder for fundraising efforts that genuinely seek to benefit veterans and the disabled,” Miller said.

“The bottom line is that there's a lot of misrepresentation, a lot of fraud out there on the telephone when it comes to charitable solicitation,” he added. “Iowans need to know that's out there and it's a significant risk.”

Miller said Iowans who want to give money for a charitable cause should be aware of the potential for fraud and be leery of a sympathetic names or sales pitch, ask specific questions about how the organization spends its money and request written information.