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Md., neighboring states announce settlement with ‘sham charity’

A for-profit company that misrepresented itself as a charity supporting service members will pay nearly $300,000 in restitution and cease operations as part of a multistate settlement announced Wednesday by Maryland Attorney General Brian E. Frosh and Maryland Secretary of State John C. Wobensmith.

West Virginia-based Hearts 2 Heroes Inc., doing business as Active Duty Support Services Inc., made door-to-door sales of care packages that the company said would be sent to U.S. troops overseas, leading prospective donors to believe that the company was a nonprofit and that donations were tax-deductible, according to a news release from the Maryland Office of the Attorney General.

The care packages, if they were delivered at all, went to military bases in the United States, not overseas, and staff members at the company were not veterans or volunteers as claimed, according to the release. Some staff members also took cash donations for personal use.

“Solicitors for this sham charity went door to door to deceive donors, under the guise of helping members of our military,” Frosh said in a news release. “This is another reminder to give wisely and remain vigilant against those who take advantage of the goodwill and generosity of donors.”

Maryland, along with Pennsylvania, Virginia and West Virginia, alleged that the company violated state consumer protection and charitable solicitation laws. In addition to shutting down the company’s operations, the terms of the settlement permanently ban the company’s owners from working for charitable organizations.

The settlement includes a $286,959 restitution judgment, which will be held in abeyance and enforced if the company fails to meet the terms of the settlement, and $10,000 in payments to the states.

“Through collaboration with neighboring state charity regulators, we have put an end to another charity scheme targeting Maryland’s citizens,” Wobensmith said in the news release. “I commend the dedication and commitment of the multistate team for the result in this case.”

Wobensmith’s office registers and regulates charities and their professional solicitors in the state, according to the release.

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