Business ProfileforOutsource 3000

The following describes a government action that has been resolved by either a settlement or a decision by a court or administrative agency. If the matter is being appealed, it will be noted below.

Sept. 16, 2020 - TRENTON – Attorney General Gurbir S. Grewal announced today that a lawsuit filed by New Jersey, the Federal Trade Commission (FTC), and the Attorneys General of New York, Minnesota, and Virginia has permanently shut down a sprawling, New Jersey-based charitable fundraising operation that scammed donors out of millions of dollars.

A complaint and individual settlement agreements filed in U.S. District Court for the Southern District of New York center on deceptive fundraising activities by multiple companies controlled by Mark Gelvan, a Florida resident who once lived in Montville, New Jersey.

Gelvan’s network of sham charities claimed to use donations to help homeless veterans, retired and disabled law enforcement officers, breast cancer survivors and others in need. In fact, these organizations spent almost none of the donations on the promised activities.

In addition to Gelvan, defendants in the lawsuit include several companies and New Jersey residents Thomas Berkenbush of Wanaque, William English of Belvidere and Damian Muziani of Erial. The bogus charities operated principally from office space in Reno, Nevada and Montville, New Jersey. 

According to the complaint, Gelvan and his associates kept as much as 90 percent of the money they raised for sham charities as payment for their fundraising services. Comparatively little of the money raised – sometimes less than two percent – went to the so-called charities’ charitable missions.

Filed on Monday, the complaint alleges that Gelvan and the other defendants orchestrated the deceptive fundraising operations, placing millions of telephone calls soliciting donations, writing fundraising materials and providing other key support to the sham charities.

The defendants knew, or should have known, that the sham charities were not spending the donated funds as promised, and that some of the millions of calls they had placed violated consumers’ do-not-call requests.

According to the complaint, Gelvan and his co-defendants had operated their deceptive fundraising scheme since at least 2010, bilking “tens of millions of dollars” from well-meaning American donors persuaded to give to such sham charities as: National Vietnam Veterans Foundation, Inc.; Breast Cancer Survivors Foundation, Inc.; Reserve Police Officers Association; Disabled Police and Sheriff’s Foundation, Inc.; Center for American Homeless Veterans, Inc; and Crisis Relief Network.

Through telemarketing and mailings, Gelvan and his associates promised prospective donors their charitable contributions would “support worthy causes” such as care packages to Vietnam veterans in need, transitional facilities for homeless veterans, and grants to the family members of fallen officers.

Under individual settlement agreements filed today, Gelvan and his associates are permanently barred from participating in any charitable fundraising, and from deceiving consumers in any other fundraising effort - including for political action committees (PACs).

If involved in non-charitable fundraising, the defendants will be required to clearly inform consumers at the time they ask for money that any donations are not charitable and not eligible for tax deductions. Under today’s settlements, the following terms apply:

Mark Gelvan, Outreach Calling, Inc., Outsource 3000, Inc., and Production Consulting Corp.: These defendants will be subject to a monetary judgment of $56,023,481, which is partially suspended based on their inability to pay. The corporate defendants will be required to surrender $45,386. Gelvan will be required to surrender $800,000, and will be required to sell two New Jersey properties (one in Montville and one in Wayne) and surrender any net proceeds of those sales.

Under the settlement, monies being surrendered by Gelvan and the other individual and corporate defendants will be paid to the State of New York, on behalf of the participating Attorneys General, for distribution to one or more charitable organizations recommended by the participating Attorneys General that have charitable purposes and missions substantially similar to the purposes for which the defendants obtained charitable contributions.

Should any of the defendants fail to pay what they owe or be found to have lied about their ability to pay, the full amount of their judgments will be due immediately.