Attorney General Ford Joins FTC, 38 States, D.C. to Shut Down Massive Charity Fraud Telefunding Operation

March 4, 2021

Defendants placed more than 1.3 billion deceptive fundraising calls — most illegal robocalls — claiming to support veterans, children, firefighters

Carson City, NV – Nevada Attorney General Aaron D. Ford, along with the Federal Trade Commission and 46 agencies from 38 states and the District of Columbia, has stopped a massive telefunding operation that bombarded 67 million consumers with 1.3 billion deceptive charitable fundraising calls, mostly illegal robocalls. The defendants collected more than $110 million using their deceptive solicitations.

Associated Community Services (ACS) and a number of related defendants have agreed to settle charges by the FTC and state agencies that they duped generous Americans into donating to charities that failed to provide the services they promised.

“These illegal robocalls not only posed an annoyance to consumers, but also tricked Nevadans into giving their money over to what they thought was a charitable organization,” said AG Ford. “My office is committed to shutting down these types of fraudulent robocallers who prey on our residents for good.”

“Deceptive charitable fundraising can be big business for scammers, especially when they use illegal robocalls,” said Daniel Kaufman, Acting Director of the FTC’s Bureau of Consumer Protection.  “The FTC and our state partners are prepared to hold fraudsters accountable when they target generous consumers with lies.”

The complaint alleges the defendants violated provisions of the Nevada Deceptive Trade Practices Act, the FTC Act of 1914, the Telemarketing Sales Rule (TSR), and numerous other state and federal laws. In addition to ACS, the complaint names as defendants its sister companies Central Processing Services and Community Services Appeal; their owners, Dick Cole, Bill Burland, Barbara Cole, and Amy Burland; and ACS senior managers Nikole Gilstorf, Tony Lia, John Lucidi, and Scot Stepek. In addition, the complaint names two fundraising companies allegedly operated by Gilstorf and Lia as spin-offs of ACS, Directele, and The Dale Corporation.

According to the complaint, the defendants knew that the organizations for which they were fundraising spent little or no money on the charitable causes they claimed to support—in some cases as little as one-tenth of one percent. The defendants, with knowledge and failing to disclose, kept as much 90 cents of every dollar they solicited from generous donors on behalf of the charities.

The complaint alleges that the defendants made their deceptive pitches since at least 2008 on behalf of numerous organizations that claimed to support homeless veterans, victims of house fires, breast cancer patients, children with autism, and other causes that well-meaning Americans were enticed to support through the defendants’ high-pressure tactics. ACS was also the major fundraiser for the sham Cancer Fund charities that were shut down by the FTC and states in 2015.

In many instances, the complaint alleges, ACS, and later Directele, knowingly violated the TSR by using soundboard technology in telemarketing calls. With that technology, an operator plays pre-recorded messages to consumers instead of speaking with them naturally. Use of such pre-recorded messages in calls to first-time donors violates the TSR. Use of the technology in calls to prior donors also violates the TSR unless call recipients are affirmatively told about their ability to opt out of all future calls and provided a mechanism to do so.

The complaint also charges ACS with making harassing calls, noting that ACS called more than 1.3 million phone numbers more than 10 times in a single week and 7.8 million numbers more than twice in an hour. More than 500 phone numbers were even called 5,000 times or more.

Each of the Associated Community Services defendants will be permanently prohibited from conducting or consulting on any fundraising activities and from conducting telemarketing of any kind to sell goods or services. In addition, they will be prohibited from using any existing donor lists and from further violations of state charitable giving laws, as well as from making any misrepresentation about a product or service.

The Directele and ACS senior manager defendants will be permanently prohibited from any fundraising work or consulting on behalf of any charitable organization or any nonprofit organization that claims to work on behalf of causes similar to those outlined in the complaint. They will also be prohibited from using robocalls for any form of telemarketing, using abusive calling practices, or making any misrepresentation about a product or service. In addition, the defendants will be required to clearly and conspicuously disclose when a donation they are requesting is not tax deductible. The two corporate defendants—Directele Inc. and The Dale Corporation—will be required to cease operations and dissolve.

Several of the defendants will be subject to monetary judgments that are fully or partially suspended due to inability to pay. The surrendered funds will be paid to an escrow fund held by the State of Florida and, following a motion by the participating states and approval by the court, be contributed to one or more legitimate charities that support causes similar to those for which the defendants solicited.

Other state agencies joining in the case with Nevada and the FTC include the attorneys general of Alabama, California, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Georgia,  Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Missouri, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Utah, Virginia, Washington, West Virginia, Wisconsin, and Wyoming; the secretaries of state of Colorado, Georgia, Maryland, North Carolina, and Tennessee; and the Florida Department of Agriculture and Consumer Services and the Utah Division of Consumer Protection.

The complaint and stipulations re orderswere filedin the U.S. District Court for the Eastern District of Michigan.  

The FTC has more information for consumers about charitable giving, including tips on how to spot sham charities at In addition, consumers are encouraged to let the FTC know about charity fraud, robocalls, and other consumer issues at You may also file a complaint with the Office of the Nevada Attorney General at

The complaint is attached.