Alleged Scammers Collected Tens of Millions of Dollars for Fake Charities

  • Minnesota AG Keith Ellison, New Jersey AG Gurbir Grewal, New York AG Letitia James, Virginia AG Mark Herring and the Federal Trade Commission (“FTC”) reached a settlement with Mark Gelvan, multiple companies under his control, and his associates (collectively “Defendants”) over allegations that they ran a deceptive fundraising scheme in violation of the FTC Act, the Telemarketing Sales Rule, and various state laws relating to charitable organizations and consumer protection.
  • The complaint alleged that Defendants solicited and accepted tens of millions of dollars from donors on behalf of sham charities, including those purporting to support Vietnam veterans, breast cancer survivors, and disabled police officers, through telemarketing and mailings that promised the money donated would go to worthy causes, but in reality less than 5 percent of the donations collected were spent on the stated charitable programs.
  • Under the terms of the proposed settlements with Gelvan and the individual defendants, among other things, Gelvan and the corporate defendants are subject to a monetary judgment of approximately $56 million, partially suspended due to inability to pay and therefore reduced to approximately $45,000 for the companies and $800,000 for Gelvan individually. Gelvan’s three individual associates will also be subject to monetary judgments totaling $2.49 million, also partially suspended and reduced to approximately $47,000.
  • All funds will be paid to New York, which will distribute them to charities providing the services that the sham charities purported to provide. In addition, all individual defendants will be permanently barred from participating in any charity fundraising, including political action committees.