City Suspends Charity Solicitor’s Permit to Operate

Los Angeles city officials suspended the operations of a charity telemarketing firm Thursday for allegedly receiving funds on behalf of an organization it does not represent.

Robert D. Burns, general manager of the Los Angeles Social Service Department, notified Valley Fundraisers--a commercial business that seeks donations for charities--that he had withdrawn the firm’s permit to solicit in the city and was taking steps that could lead to permanent revocation of its fund-raising license.

Citing a Times investigation disclosing that Valley Fundraisers deposited thousands of dollars in checks to organizations it did not represent, Burns has ordered its president, Thomas Galambos, to produce all the firm’s records.

Burns said he planned to audit the records to determine if there is evidence to recommend that the Los Angeles Social Service Commission permanently revoke the firm’s license to solicit in Los Angeles, or to press criminal charges.

In is a misdemeanor in Los Angeles to commit fraud or deception in charitable solicitation or to solicit on behalf of another person or organization without authorization.

Galambos could not be reached for comment Thursday. The telephone in his Burbank headquarters had been disconnected. Galambos’ attorney, Elliott Kajan, did not return a call from The Times.

The Times disclosed earlier this month that Valley Fundraisers, which has taken in more than $2.6 million in charitable donations in the last four years, has deposited dozens of checks made out to charities that do not exist and real charities that never received the money.

“In view of the extraordinary articles appearing in the Los Angeles Times, I suggest that you secure all books, records and papers relating to your solicitations,” Burns wrote to Galambos in a May 11 letter.

The letter said those measures were necessary “to ensure that neither fire nor mysterious disappearance creates a credibility problem that would cause a reasonable person to conclude that Valley Fundraisers Inc., and its successors are not fit and suitable to perform the tasks associated with being a professional fund-raiser for charitable purposes.”

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Burns said Galambos did not comply with the demand. In a second letter Thursday, Burns suspended the permit for Galambos’ current fund-raising campaign, which was due to expire in August. If Galambos not respond to a demand for records by today, his permanent license to conduct professional fund raising in the city will be revoked, Burns said.

Burns said Valley Fundraisers’ office on Alameda Avenue in Burbank was locked and no one answered the door when he personally dropped off the May 11 letter. Burns’ office said he hand delivered copies of Thursday’s letter to Galambos’ residence and to his attorney.

The suspension of Valley Fundraisers’ solicitation permit, which is subject to appeal by Galambos, bars the firm from calling residents of Los Angeles to ask for donations. It does not affect the firm’s solicitations in other cities across the Los Angeles Basin.

One of 121 commercial fund-raising firms in California, Valley Fundraisers is licensed by the attorney general’s Registry of Charitable Trusts to solicit donations for three IRS-registered charities.

Burns said he received a complaint from a Los Angeles man who wrote a check to “Foundation for Junior Blind” in response to a telephone solicitation, then became suspicious when he learned it was deposited by Valley Fundraisers.

The Foundation for the Junior Blind in Los Angeles told him it received no money from Valley Fundraisers and did not authorize the solicitation, Burns said.

Galambos, in an earlier interview, acknowledged that mistakes had been made, but said he corrected every one that came to his attention by refunding the donor’s money.

Burns said that the refund of improperly received money is not an excuse for misrepresentation in the solicitation.

Immediately after The Times’ articles, state charity regulators also announced investigations of Valley Fundraisers. Deputy Atty. Gen. James Cordi, who is heading the state’s investigation, declined to comment Thursday on its progress.