Troopers association defends phone sales pitch Jelly sales profits mostly go to seller

January 31, 1993|By Norris P. West | Norris P. West,Staff Writer

When John J. Costa agreed to buy a $29.95 package of seasonings to benefit the Maryland Troopers Association, he didn't realize that the group would get only $3.86. The rest went to a Tennessee company that makes food products and employs telemarketers to sell them in Maryland and elsewhere.

"Now I really feel ripped off," said Mr. Costa, a retired executive who lives in Hagerstown.

Mr. Costa is one of thousands of Marylanders who have agreed to buy products to support the troopers, whose association receives only 12.89 percent of the proceeds.

A group that evaluates charities and organizations that raise money from the public says that solicitors should disclose how much money goes to the cause and that people should be cautious if that amounts to less than half.

"It should be up to the donor whether they want to give or not, but

first they should have this information," said Bennett M. Weiner, of the Philanthropic Advisory Service of the Council of Better Business Bureaus in Arlington, Va.

Sgt. Patrick V. Drum, president of the Maryland Troopers Association, defends his organization's fund-raising arrangement.

He said that proceeds pay for anti-drug coloring books and billboards as well as for the fraternal group's expenses -- including spousal-survival benefits -- and he notes that the group contributes money to a children's cancer charity.

Sergeant Drum said a purchaser should not be concerned that the troopers organization receives only a fraction of the money they send.

"You're actually buying something," he said. "I look at that as being different from actually donating money to charity."

The products sold on behalf of the troopers association are made by Smoky Mountain Secrets of Alcoa, Tenn., which employs about 100 telephone solicitors in Maryland.

For $29.95, a supporter can buy the package of seasonings or an array of six, 10-ounce jars of jelly described as "Handmade & Handpacked in the Foothills of the Great Smoky Mountains." The goods usually are delivered to the buyer's home, accompanied by a bright yellow bumper sticker that reads: "Bears Against Drugs."

In April 1991, during a hearing before the Maryland secretary of state, a company official said that solicitors had made 700,000 calls in Maryland since it had begun operations in the state in April 1990. He said 10 percent of the calls resulted in sales, according to hearing transcripts. That would translate into about $2.1 million in sales during the period, with the troopers association receiving about $270,000, figured at 12.89 percent of the gross.

The secretary of state's office, which regulates charities, issued a cease-and-desist order against the troopers association in 1991 after receiving a stream of complaints.

People said that solicitors falsely identified themselves as troopers and claimed that their money would go charity -- specifically to anti-drug programs. The association signed a consent decree, under which paid telemarketers must follow a carefully worded script. They must not saythey are soliciting for charity and must not lead people to believe they are troopers.

The secretary of state's office has taken action against seven FTC other law-enforcement fraternal organizations over the past two years, a spokeswoman said.

In 1984, the U.S. Supreme Court struck down a Maryland law that required charities to spend at least 75 percent of donations on the programs that donations are supposed to benefit. Four years later, the nation's high court struck down a state law that prohibited paid solicitors from receiving more than 30 percent of the gross revenues they raised.

Groups that raise money for charity are required to register with the state in most cases.

Law-enforcement groups usually are classified as fraternal organizations and are not required to register unless raising money for charity.

Secretary of State Winfield M. Kelly Jr. expressed concern in a recent interview that some people, particularly senior citizens, panic when callers ask them to donate money or buy something. "I don't think you can determine the legitimacy of an organization over the phone," Mr. Kelly said. "I think that too often, things happen too quickly in this atmosphere. You need time to reflect on the process of giving."

Smoky Mountain Secrets and its sales for a troopers association have also come under scrutiny in Minnesota. That state's attorney general, Hubert Humphrey III, is charging in a lawsuit that the company and the association were using fraud to sell jelly and spices.

Minnesota officials expressed concern that a public safety organization was relying on telemarketing to raise money and that the group was getting only a fraction of the proceeds. In a 1991 survey of police and fire fighter solicitations, the Charities Review Council of Minnesota found that 17 percent of money raised went to the associations. The other 83 percent went to the fund-raisers, according to its report, "Where Does Your Money Go?"

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