The State AG Report Weekly Update April 20, 2017


California Attorney General Sues Veterans Charities for Alleged Misuse of Funds

  • California AG Xavier Becerra filed a lawsuit against charity organizations Warriors Support Group and Central Coast Equine Rescue and Retirement and the charities’ operators (collectively, “Warriors”) over allegations that their claims that they supported veterans were deceptive and that proceeds from charity raffles were misappropriated for personal use.
  • According to the AG’s office, Warriors allegedly held fundraisers implying funds would support veterans, but ultimately the donated proceeds were used by Warriors to buy clothing, dine at restaurants, travel, pay off personal credit cards, and pay other personal expenses.
  • The lawsuit seeks damages, civil penalties, involuntary dissolution of the charities, and a permanent injunction against the charity operators, among other things.

Consumer Protection

District of Columbia Attorney General Reaches Settlement with Debt Collector to Forgive Allegedly Unlawful Debts

  • District of Columbia AG Karl Racine reached a settlement with Collect Pros, LLC, a debt collection company, and its owner (collectively, “Collect Pros”) over allegations that it violated DC’s debt collection and consumer protection laws when it engaged in unlawful debt collection tactics.
  • According to the AG’s office, Collect Pros allegedly collected illegal debt from DC consumers that included debt from magazine subscriptions that consumers claimed they never agreed to or debts that had already been settled, discharged, or determined uncollectable.
  • Under the terms of the settlement, Collect Pros is required to forgive $220,000 in uncollected consumer debt, return $1,200 in restitution for collected debt, pay $2,500 in civil penalties, and cease violating consumer protection laws.

District of Columbia Attorney General Settles with Immigrant-Consultant Services Company Over Alleged Notario Fraud

  • District of Columbia AG Racine reached a settlement with immigrant consultant company Unlimited Technology and Solution Corporation and its sole owner and operator (collectively, “UTS”) for allegedly misrepresenting services to Spanish-speaking immigrants, violating DC’s notario fraud law and federal law.
  • According to the AG’s office, UTS allegedly targeted Spanish-speaking communities in DC and offered to assist consumers with immigration matters, when in reality UTS had no licensed attorneys, often provided incorrect legal advice, and failed to perform advertised immigration services, a practice often called “notario fraud.”
  • Under the terms of the consent judgment and order, UTS is required to return $100,000 in fees it collected from consumers, help identify consumers who are entitled to restitution, and pay DC $150,000 in civil penalties, half of which will be waived if UTS complies with the settlement’s terms.


Massachusetts Attorney General Settles with Waste Transport Company Over Allegations It Mishandled Hazardous Waste

  • Massachusetts AG Maura Healey reached a settlement with Massachusetts hazardous waste transport company EQ Northeast Inc. (“EQ”) over allegations that it violated the state Consumer Protection Act and the federal Hazardous Waste Management Act when it transported hazardous waste to an unlicensed facility.
  • According to the AG’s office, EQ allegedly violated the law on at least 10 occasions when the company transported hazardous waste shipments to its Wrentham, Massachusetts facility instead of licensed designated facilities in Michigan and Oklahoma, and that it engaged in deceptive conduct by withholding from consumers information about the company’s practice of stockpiling large volumes of hazardous waste in unlicensed facilities.
  • Under the terms of the agreement, EQ will pay $150,000 in civil penalties.

Financial Industry

California Attorney General Urges Acting U.S. Secretary of Labor to Implement Financial Regulation for Retirement Investments

  • California AG Becerra sent a letter to Acting U.S. Secretary of Labor Edward Hugler urging him to immediately implement the delayed “fiduciary rule,” which aims to mitigate conflict of interest by ensuring that a retirement advisor’s legal responsibility is solely to the clients they are advising and not compromised by the advisor’s potential financial gain.
  • AG Becerra’s letter states that the fiduciary rule, first proposed in 2010, has undergone a thorough and inclusive development process, which included over 3,000 public comments from a variety of viewpoints.
  • According to media reports, the fiduciary rule was scheduled to go into effect on April 10, 2017 but was delayed when the Department of Labor extended the waiting period to June 9.

Health Care

Arizona Attorney General Reaches Settlement Against Blood Test Company Over Allegations of Deceptive Advertising

  • Arizona AG Mark Brnovich reached a settlement with blood test operator and manufacturer Theranos, Inc. (“Theranos”) for allegedly violating state consumer protection laws over the marketing of its products.
  • According to the complaint, Theranos allegedly misrepresented the accuracy of its blood testing products when it falsely advertised that most of its blood testing was done by finger-pricking or proprietary methods, misled consumers and healthcare providers into believing its tests were of the highest levels of accuracy despite failing to implement a quality control program, and misrepresented to consumers its compliance with federal regulations.
  • Under the terms of the consent judgment, Theranos will pay the state $4.65 million in consumer restitution, $200,000 in civil penalties, $25,000 in attorneys’ fees, and the costs for a claims administrator to distribute the restitution to consumers, and a temporary injunction was issued against the company from operating in Arizona for two years.

State AGs in the News

Alabama Governor Sets Special Election Date for U.S. Senate Seat

  • Alabama Governor Kay Ivey signed a proclamation setting a special election date for the U.S. Senate seat vacated by former Senator Jeff Sessions, scheduling it almost a year ahead of the previously scheduled election date.
  • As we previously reported, former AG Luther Strange was appointed to the U.S. Senate by then Governor Bentley to fill the U.S. Senate seat of Jeff Sessions, who was confirmed as U.S. Attorney General on February 8, 2017.
  • According to the Governor’s office, the special election primary will occur on August 15, 2017 (with a runoff, if needed, on September 26), and the general election on December 12. Prior to Ivey assuming the governorship, former Governor Robert Bentley had chosen not to hold a special election and instead wait until the normally-scheduled November 6, 2018 mid-term elections.
  • No special election is currently scheduled for the Alabama AG, a post currently held by Steve Marshall who was appointed by former Governor Bentley to fill the rest of Luther Strange’s term.