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Polk County judge bars Telequal from professional fundraising in Iowa

Published: Wednesday, May 1, 2013 11:13 a.m. CDT • Updated: Wednesday, May 1, 2013 11:14 a.m. CDT

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An Osceola-based telemarketing company and its operators have been barred from professional fundraising in Iowa.

A judgment on Telequal LLC was issued April 15 from a Polk County judge.

According to a press release from the office of Iowa Attorney General Tom Miller, the judgment comes after a state undercover phone line recorded what Miller called a “highly deceptive pitch” from a for-profit company that claimed it was raising money to grant the wishes of terminally ill Iowa children.

Undercover

In July, the Consumer Protection Division’s undercover phone line recorded a representative of Telequal attempting to solicit money on behalf of “A Child’s Dream Foundation,” a Knoxville, Tenn., nonprofit organization.

The intended recipient of the call was a 73-year-old widow with Alzheimer’s disease who had given money in the past. 

The woman’s family had previously changed her phone number and consented to forwarding calls placed to her old number to the Consumer Protection Division’s undercover phone line. A Consumer Protection Division staff member posed as the woman on the call.

In the press release, Miller said the Telequal representative “outright lied” in the call.

“She said she was calling from the charity, claimed that the charity focused primarily on sick Iowa kids, and also claimed that a lot of each donation went to the kids,” Miller said. “In truth, the call was coming from Telequal. They were asking for money for an out-of-state charity that has no special Iowa focus, and 85 percent of every dollar donated went to the telemarketer, not to sick kids.”

After recording the solicitation, a Consumer Protection Division investigator interviewed Telequal ex-employees, who confirmed that similar deceptions were routine.

Consent judgment

Shortly before Miller planned to file a consumer fraud lawsuit, the business began to shut down. In signing the consent judgment that finalizes the shutdown, the defendants denied wrongdoing.

In addition to Osceola-based Telequal, the consent judgment also named four Osceola residents, including its owner, Travis J. Held, 36, Amanda D. Held, 41, and Telequal employees Jeffrey J. Jones, 42, and Jennifer L. Jones, 42.

The civil case was filed under the Iowa Consumer Fraud Act. It is not a criminal case with charges.

In the consent judgment, it is ordered the four defendants shall be permanently enjoined from engaging, directly or indirectly, in any form of fundraising, whether by telephone or otherwise, directed to residents of Iowa or directed to residents of other states from an Iowa location.

In addition to whatever other legal remedies may be available, a violation of the consent judgment constitutes a violation of the Iowa Consumer Fraud Act, and each violation gives rise to a presumptive civil penalty in the highest amount, namely $40,000.

It is also ordered the “defendants shall make no direct or indirect use whatsoever of information regarding persons in Iowa or elsewhere who made a pledge and/or donation in response to any fundraising efforts of Telequal, if Defendants know or should know under the circumstances that such information was derived from fundraising efforts of Telequal.”

This includes without limitation using such information to make fundraising contacts, selling, renting or making available any such information to another entity for the other entity’s use in fundraising or otherwise.

The consent judgment states the defendants shall “comply with reasonable requests from the Iowa Attorney General for information relating to compliance,” and “make their best efforts to make full refunds of specified donations upon receiving a request to do so either directly from the donors or forwarded by the Iowa Attorney General.”

This is the third time in the past three years Miller’s office has shut down an Iowa telemarketing operation for allegedly deceptive practices, according to the press release. In each instance, undercover phone line recordings were key.

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