Bob Ferguson's lawsuit claims both groups violated the Consumer Protection Act, which prohibits deceptive marketing, and the Charitable Solicitations Act, which bans false, misleading or deceptive solicitations.
Washington state Attorney General Bob Ferguson has sued a pair of nonprofit veteran-aid charities for allegedly deceiving donors over how their money is spent.
In Pierce County, Ferguson sued the Spanaway-based nonprofit Fallen Hero Bracelets, and in King County he sued a Florida-based nonprofit Healing Heroes Network, alleging they have victimized as many as 7,800 Washington residents, soliciting donations for veterans but using the money otherwise. Ferguson’s office worked with the Office of Secretary of State in a nationwide effort that was spearheaded by the Federal Trade Commission (FTC).
“These organizations used the promise of improving veterans’ lives to mislead donors. Their illegal actions are not only disrespectful to donors, but also to the veterans they claim to help,” Ferguson said in a statement.
The lawsuit alleged that both operations, Fallen Hero Bracelets and Healing Heroes Network, told donors that their charity would assist veterans, yet very little of the money raised by the two organizations did so. Ferguson’s lawsuit claims both groups violated the Consumer Protection Act, which prohibits deceptive marketing, and the Charitable Solicitations Act, which bans false, misleading or deceptive charitable solicitations.
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Fallen Hero Bracelets is run by Michael Alexander Friedmann, of Spanaway, who has been soliciting charitable donations for veterans since 2015 through a website which is linked to two other nonprofits also registered to Friedmann. Fallen Hero Bracelets’ website sells bracelets, engraved bullets, hats and other military-themed merchandise. The website claims sales and donations support a long list of veteran-related organizations and a program providing service dogs for veterans suffering from post-traumatic stress syndrome. Friedmann did not return a reporter’s phone call.
The state contends that none of these named organizations received money from Friedmann’s operations.
Ferguson alleges Friedmann’s enterprises also ran afoul of state regulations by failing to register with the Office of the Secretary of State and giving itself an “A-plus” ranking from the fictitious “Business Bureau of America.” Fallen Hero Bracelets has an “F rating” from the very real Better Business Bureau. Friedmann even went so far as to create a symbol for the fake bureau that closely hews to the actual bureau’s emblem.
The Better Business Bureau warned consumers about Fallen Hero Bracelets on its website in July 2017, laying out numerous complaints about purchases not arriving for months. When the nonprofit was contacted by customers and donors they were greeted with profanities. The Better Business Bureau again claimed nothing had changed as of May 18, pointing out that Fallen Hero Bracelets’ website makes claims about timely shipping it doesn’t meet and when customers complain, Friedmann files claims against them in small-claims court and reports them to collection agencies.
Ferguson also filed a lawsuit against the now-shuttered nonprofit Healing Heroes Network and its affiliated and active for-profit counterpart, Hero Giveaways LLC, both managed by Stacey Jill Spiegel, her son Neal Aaron Spiegel and her husband, Allan Mark Spiegel. Washington state is suing the Florida family because they targeted and received donations from state residents dating back to at least 2009 through 2017.
Among the charges by the state is that the Spiegels made false, misleading and deceptive statements to get charitable donations and implied donors could enter a sweepstakes with a grand prize of $10,500. Nobody has won the grand prize since 2010. The lawsuit says the Spiegels’ charity generated more than $2.5 million in revenue in 2016 and 2017, yet spent less than 1 percent of it on wounded veterans.
The FTC’s effort, called Operation Donate With Honor, snared organizations in 34 states. Both Friedmann and the Spiegels could face fines of up to $2,000 for each violation and payment of attorney costs and fees. The lawsuit also requests the court require the two groups to cease deceptive practices and pay restitution to consumers.
In a statement, Secretary of State Kim Wyman said, “Washingtonians deserve to know that their good-faith donations to charitable causes are going to benefit the people those charities claim to be helping. In almost every instance, that’s what happens. But vigilance is important, because there are some out there who will try to take advantage of the patriotic gratitude that those who’ve served our country deserve.”