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For immediate release Friday, May 16, 2008.
Contact Bill Brauch 515-281-8772.

A.G. Sues Direct-Mail Operation for Deception Aimed at Older Iowans

Suit alleges Defendant Paul Gluchanicz sold names of Iowans who sent $20 “administration” fee thinking they had won huge cash prizes.

Iowa Attorney General Tom Miller filed a consumer fraud lawsuit Friday alleging that a Pennsylvania direct-mail operator deceived especially older Iowans into thinking they had won cash prizes worth hundreds of thousands of dollars – and into sending $20 “administration” or “registration” fees to collect their purported prize money.

“First, we allege the mailings were deceptive,” Miller said.

“Second, we allege that Iowans wasted and lost their $20 payments because they received nothing more than a list of other sweepstakes and contests.

“Third, and perhaps most offensive, we allege the defendant collected and sold lists of the persons who responded to the deceptive solicitations. Such lists exposed vulnerable individuals to still more victimization,” Miller said. “Such lists would be invaluable to questionable prize promoters or telemarketers with designs on the vulnerable elderly.”

The consumer fraud lawsuit, filed Friday in Polk County District Court, named Paul Gluchanicz of Wayne, PA, near Philadelphia. Gluchanicz has done business as “Sweepstakes Research Legal Dept.,” “Asset Allocation Authority,” “American Award Advisory,” and others.

The suit asked for preliminary and permanent injunctions prohibiting deceptive practices, restitution to Iowa consumers, “disgorgement of all ill-gotten gain,” civil penalties up to $40,000 per violation, and additional civil penalties up to $5,000 per violation for consumer fraud committed against an Iowan age 65 or over.

More background and detail:

Paul Gluchanicz resides in Wayne, Pennsylvania.

Gluchanicz conducts or has conducted business through such companies and “DBAs” as Sweepstakes Research Legal Department, Asset Allocation Authority, American Award Advisory, Keystone Associates, Inc., Solaris Direct, Inc., American Prize Publications, APP, Win America, American Sweeps Registry, Universal Consulting Services, Inc., Zodiac Direct, Inc., Paragon Direct Marketing, Inc. and Paragon Astrology, Inc., and probably others.

“We allege that Gluchanicz sent out deceptive mass mailings to Iowans, especially older Iowans, intended to trick them into thinking they were winning as much as $950,000 in a sweepstakes,” Miller said.

The lawsuit alleged that Gluchanicz’s mailings were sent in envelopes with such return addresses as “Payer Office, Asset Allocation Authority,” and bore such headings as “Payout Confirmation Notice” and “Official Notification.” Miller said the mailings used terms that implied that the sender had been looking for the consumer – like “found,” “track,” “trace”and “recipient identified” -- and terms that insinuated that the recipient had already won a big prize – like “claimant” and “official notification.”

Gluchanicz signed the mailings using titles such as “Prize Notification Director,” “Dispatch Officer, Audit Control Division” and “Legal Department Adjutant,” the suit said.

“In fact, Iowans who took the bait and sent in the requested $20 ‘administration fee’ received only a sweepstakes newsletter -- and their names were added to a list of susceptible consumers destined to be rented to other direct-mailers or telemarketers,” Miller said.

“It’s bad enough that many older Iowans are made to think they’ve won a big prize when they haven’t, and it’s worse for them to be tricked out of twenty dollars,” Miller said.

“But worst of all is that by responding they’ve identified themselves as vulnerable to prize schemes, and their names may end up on lists that expose them to further exploitation.”

Miller cautioned consumers to be wary of questionable prize and sweepstakes schemes, to be highly skeptical that they had won huge prizes, not to send money to collect any so-called prize, and not to purchase magazines or merchandise thinking it will make them more likely to win a sweepstakes prize.

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