Lawyers with Illinois Attorney General Lisa Madigan’s Office filed suit Jan. 27 in Cook County Circuit Court against Safety Publications, asking the court to slap on an injunction and order the firm to open its books and pay financial penalties. Named defendants are Adam Herdman and Arthur Olivera, the only principal officers and directors of Safety Publications. It is the third time this century these particular defendants have run afoul of the state’s top lawyer.
The company dates to 1998, but Madigan’s most recent complaint targeted its contracted charitable solicitation efforts from 2010 through at least October 2015 and details the ways in which Safety Publications allegedly violated the state’s Solicitation For Charity Act, including allegedly keeping the lion’s share of millions of dollars in public contributions ostensibly collected for charitable organizations.
In the required 2010 annual report, which the firm filed May 31, 2011, Safety Publications said it raised $898,753 in the name of its eight charity clients, but after retaining $765,269 in compensation, the agencies received a total of $142,466. In 2011, the number of customer firms increased to 16, although four were listed as having zero dollars raised. For the other 12 — including the Illinois Jaycees, Illinois Vietnam Veterans and Firefighters Burn Fund — Safety Publications pulled in about $1.02 million, but kept $859,659 in compensation and disbursed just $157,648.
The 2012 report, which was not filed until Sept. 15, 2014, showed just four charity clients keeping $108,174 of the $752,607 raised. There was no report filed for 2013, and the 2014 report showed four clients who kept $1,350 of the total $9,605.
Further, although Olivera was convicted of felony arson in 1983, the attorney general’s complaint noted he did not disclose that information as required on the state’s Professional Fund Raiser Registration Statements, which Safety Publications submitted each year. The company also failed to report on its annual forms its work for VNH/Veterans Now, for which it purportedly raised about $1.63 million from 2010 through 2015, yet yielded the charity only $166,183.
The complaint contained the script Safety Publications employees were to use when calling on behalf of VNH/Veterans Now, which Madigan noted did not comply with the requirement for prompt, verbal notification “the solicitation is being made by a paid professional fundraiser.”
Madigan’s complaint detailed other Solicitation Act violation complaints the state brought against the same defendants in 2002 and 2007, both of which led to consent decrees in which Herdman and Olivera acknowledged their obligations to comply with the fundraising law.
The complaint asked the court to subject the defendants to punitive damages for individual violations of the law — $5,000 for each — as well as forfeiture of all compensation connected “with their unlawful solicitation campaign.” Madigan requested a full accounting of any work done on behalf of VeteransNow, which is based in Rockford, as well as temporary restraining and preliminary and permanent injunctions barring the firm or its owners from any further work for charitable organizations.
Madigan said, if forfeited, the $1,363,666 the defendants allegedly kept from its efforts for VeteransNow would funnel through her office “to such bona fide registered Illinois charities that actually assist veterans returning home from war.”
The complaint requested additional penalties for violations of the 2002 and 2007 court orders, as much as $2,000 for each individual infraction.
Assistant Attorneys General Barry S. Goldberg, Therese Harris and Pasquale Esposito, of the agency’s Charitable Trust Bureau, were identified as the preparers of the complaint.