NPR logo Telemarketers Will Pay $18.8 Million Settlement

Telemarketers Will Pay $18.8 Million Settlement

Telemarketers will pay a huge settlement for pocketing a fat slice of donations that people thought were going directly to support cops, firemen and veterans, the FTC said today.

As part of the deal, one of the guys who ran the telemarketing outfit 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.

In all, the settlement totals $18.8 million, to be paid by two companies and the two men who ran them, the FTC said.

They had run-ins with the feds going back more than a decade. A 1998 suit accused one of the companies of "falsely claiming that ... donations would be used locally to buy bullet-proof vests and provide death benefits for deceased officers' surviving family members."

In 2007, the Department of Justice said the telemarketers continued to tell people that "100 percent" of their donations would go to benefit the charities. In fact, the telemarketing company passed on 10 percent to 15 percent of the donations to charity and kept the rest for itself, the FTC said.

The owners couldn't be reached for comment, the AP reported this afternoon.