Founder of Professional Fundraising Company Ordered to Pay $125,000 for Using Deceptive Tactics While Soliciting for Veterans Charity
Prohibited from Work with Public Charity and Solicitation in Massachusetts
BOSTON – The founder of a professional fundraising company has been ordered to pay $125,000 in civil penalties for using deceptive tactics while soliciting money for a veterans charity, Attorney General Martha Coakley announced today. He is also prohibited from being involved in public charity or solicitation in Massachusetts.
A final judgment was entered yesterday in Suffolk Superior Court by Judge Heidi Brieger against Thomas Gity, Jr., of Pompano Beach, Fla., founder of Rhode Island-based fundraiser, Dynamic Marketing Solutions, Inc. (Dynamic). Under the judgment, Gity was ordered to pay $125,000 in civil penalties for engaging in deceptive practices and statutory violations while conducting charitable solicitations for Bay State Vietnam Veterans, Inc. (Bay State), a Somerset charity.
“This defendant is being held responsible for misleading donors to believe that all donations were going directly to benefit veterans when in fact a very small percentage was going to that purpose,” AG Coakley said. “We are pleased that the court granted our request for civil penalties from this defendant for knowingly taking advantage of the public’s trust.”
In August 2012, a preliminary injunction was obtained in conjunction with a lawsuit filed by the AG’s Office against Bay State, Dynamic, Gity and Dynamic’s president, John Chaves, of Warren, R.I. The AG’s Office on Tuesday sought, and was granted, a final judgment and assessment of damages against Gity for his failure to comply with the terms of the preliminary injunction and failure to file any pleadings in the matter.
Additionally, under the terms of the final judgment, Gity, his employees, and anyone else involved in his operation, are permanently prohibited from being involved in any capacity at a Massachusetts public charity or any entity that solicits charitable funds from Massachusetts residents and from engaging in any deceptive acts while conducting telemarketing or solicitation.
According to the complaint filed in August 2012, the AG’s Office alleges Dynamic, hired by Bay State to raise funds, deceived potential donors by falsely stating that 100 percent of their donations would benefit veterans. In fact, only 15 percent of the solicited funds went to support veterans and 85 percent of the funds went back to Dynamic for their fundraising services.
According to the lawsuit, Dynamic’s professional fundraisers misled potential donors by falsely stating that donations would benefit veterans living in their communities. It is alleged that Dynamic’s professional fundraisers also misled potential donors by falsely claiming they were volunteers for the charity and in some cases deceptively stating that they were veterans returning from Afghanistan. The lawsuit further alleges that the fundraisers failed to inform donors of their status as professional fundraisers, as required by Massachusetts law.
The lawsuit against Dynamic, Bay State, and Chaves is pending.
The AG’s Office encourages residents to give to charities but to do so wisely. Tips on what consumers should look for in a legitimate charity can be found online at the AG’s Office website.
This matter is being handled by Assistant Attorney General Eric Carriker of AG Coakley’s Non-Profit Organizations/Public Charities Division.