Alleged Phone Scammers to Pay $18.8 MM Fine: FTC

The alleged operators of a New Jersey-based telemarketing scheme will pay a record $18.8 million and leave the charitable donation business to settle Federal Trade Commission charges that they violated an agency order by misleading consumers to believe that they were donating directly to legitimate charities serving police, firefighters, and veterans, when in fact only a small slice of the donations actually went to these charities, according to the FTC.

Named as defendants were Civic Development Group, LLC; CDG Management LLC; and owners Scott Pasch and David Keezer, according to the FTC.

According to the Commission, Civic Development Group’s telemarketers deceived consumers by telling them that they worked directly for the charities they called about, and that “100%” of the consumers’ donations would go to the charities.

Under the settlements, the defendants are permanently banned from telemarketing and soliciting charitable donations, and prohibited from making false claims about anything they sell, according to the FTC.

In addition, Pasch and Keezer are required to turn over numerous assets to a court-appointed liquidator, the FTC continued.

Specifically, Pasch will turn over a $2 million home; paintings by Picasso and Van Gogh valued collectively at $1.4 million; a guitar collection valued at $800,000; $270,000 in proceeds from a recently sold wine collection; jewelry valued at $117,000; three Mercedes, a Bentley, and various other assets. Keezer will turn over a $2 million home, a Range Rover, a Cadillac Escalade, and a Bentley, among other assets, according to the FTC.