ANALYSIS OF PROPOSED CONSENT ORDER
TO AID PUBLIC COMMENT

The Federal Trade Commission ("Commission") has accepted an agreement to a proposed consent order from Civic Development Group, Inc., and Community Network, Inc., corporations, and Scott Pasch and David Keezer, individually and as officers of Civic Development Group., Inc., and Richard McDonnell, individually and as an officer of Community Network, Inc. ("Respondents").

The proposed consent order has been placed on the public record for sixty (60) days for reception of comments by interested persons. Comments received during this period will become part of the public record. After sixty (60) days, the Commission will again review the agreement and the comments received and will decide whether it should withdraw from the agreement or make final the agreement’s proposed order.

This matter concerns representations made by Respondents when they solicit consumers by telephone to contribute money to the non-profit organization, the American Deputy Sheriffs’ Association ("ADSA").

The Commission’s complaint in this matter charges Respondents with engaging in unfair or deceptive acts or practices in connection with soliciting consumers by telephone to contribute to the ADSA. According to the complaint, in the course of making such solicitations, Respondents misrepresent to consumers that: money contributed by consumers to the ADSA had in the past benefitted law enforcement offices in the town, city, county, or state in which the consumers reside; money contributed to the ADSA by consumers had been used in the past to purchase bullet-proof vests for law enforcement offices in the town, city, county, or state in which the consumers reside; and money contributed to the ADSA by consumers had been used in the past to pay death benefits to the survivors of deceased law enforcement officers who resided or worked in the town, city, county, or state in which the consumers reside.

The complaint also alleges that Respondents misrepresented that: money contributed to the ADSA by consumers would be used to benefit law enforcement offices in the town, city, county, or state in which the consumers reside; money contributed to the ADSA by consumers would be used to purchase bullet-proof vests for law enforcement offices in the town, city, county, or state in which the consumers reside; and money contributed to the ADSA by consumers would be used to pay death benefits to the survivors of deceased law enforcement officers who reside or work in the town, city, county, or state in which the consumers reside.

The consent order contains provisions designed to remedy the violations charged and to prevent Respondents from engaging in similar deceptive or unfair acts or practices in the future.

Paragraph I of the order prohibits Respondents, in connection with a telephone solicitation, from misrepresenting the purpose for which charitable contribution has been or will be used.

Paragraph II of the order prohibits Respondents, in connection with a telephone solicitation, from misrepresenting the geographic location of the charity, organization or program that has benefitted or will benefit from the charitable contribution.

Paragraph III of the order prohibits Respondents, in connection with a telephone solicitation, from misrepresenting any fact material to the decision of any person to make a charitable contribution.

Paragraph IV of the order requires that Respondents, in connection with telephone solicitations, adopt an education and monitoring program designed to ensure compliance with Paragraph I through III of the order. As part of this education and monitoring program, Respondents must tape-record and review 1,000 solicitation telephone calls every thirty days.

Paragraph V of the order provides that in any action brought by the Commission to enforce the order, unless Respondents know or reasonably should have known of the violation, there shall be a rebuttable presumption that Respondents exercised good faith in complying with Parts I through III of the order, if Respondents show by a preponderance of the evidence that they have established and maintained the education and monitoring program mandated in Paragraph IV of the order.

Paragraph VI of the order requires Respondents, for a period of five (5) years, to maintain and permit representatives of the Commission access to Respondents’ business premises to inspect and copy all documents relating in any way to any conduct that is the subject of this order.

Paragraph VII of the order requires that Respondents, for a period of five (5) years, permit representatives of the Commission to interview and depose, under oath, at the Respondents’ business premises, the officers, directors, or employees of any such business with regard to compliance with the terms of this order.

Paragraph VIII of the order prohibits Respondents from providing the means and instrumentalities to, or otherwise assisting and facilitating any person who Respondents know or should know makes false or misleading representations about the purpose for which charitable contributions have been or will be used, the geographic location of the charity, organization or program that has benefitted or will benefit from charitable contributions or any fact material to any person to make any charitable contribution.

Paragraph IX of the order requires that Respondents, for a period of five (5) years from the date of entry of the order, deliver a copy of the order to all current and future principals, officers, directors, and managers of Respondents’ companies or of any affiliated companies having responsibilities with respect to the subject matter of the order, and shall secure from each such person a signed and dated statement acknowledging receipt of the order.

Paragraph X of the order requires that Respondents Civic Development Group, Inc. and Community Network, Inc. notify the Commission at least thirty (30) days prior to any change in the corporation(s) that may affect compliance obligations arising under this order. Provided, however, that, with respect to any proposed change in the corporation about which Respondents learn less than thirty (30) days prior to the date such action is to take place, Respondents shall notify the Commission as soon as is practicable after obtaining such knowledge.

Paragraph XI of the order requires that Respondents Community Network, Inc., Civic Development Group, Inc., and their successors and assigns and Respondents Scott Pasch, David Keezer, and Richard McDonnell, within sixty (60) days after the date of service of the order, and again 180 days following entry of the order, and again at such other times as the Federal Trade Commission may require, file with the Commission a report, in writing, setting forth in detail the manner and form in which they have complied with this order.

Paragraph XII of the order requires that Respondents Scott Pasch, David Keezer, and Richard McDonnell, for a period of ten (10) years after the date of issuance of the order, notify the Commission of the discontinuance of their current business or employment, or of their affiliation with any new business or employment.

Paragraph XIII of the order provides for a twenty (20) year sunset provision.

The purpose of this analysis is to facilitate public comment on the proposed order, and it is not intended to constitute an official interpretation of the agreement and proposed order, or to modify any of their terms.

By direction of the Commission, Commissioner Azcuenaga and Commissioner Swindle not participating.