State sues to help churches it says were defrauded

LOS ANGELES
February 28, 2011 12:58pm

The state of California has filed a lawsuit seeking $800,000 in restitution and civil penalties from a scam that defrauded 33 African American churches in Southern California.

Promoters promised that leased computer kiosks would enhance the experience of parishioners, but the scheme ended up creating big debts for the churches, says California Attorney General Kamala Harris.

The suit, filed Monday in Los Angeles Superior Court, names Television Broadcasting Online Ltd.; Urban Interfaith Network, both of Oxon Hill, Md.; Willie Perkins; Michael Morris; Wayne Wilson; Tanya Wilson, both of Rancho Cucamonga; Balboa Capital Corp. of Irvine; and United Leasing Associates of America Ltd., of Brookfield, Wis.

It charges them with violations of the state's unfair competition and false advertising laws, and seeks restitution, civil penalties and an injunction to prevent any further illegal activities.

"This was a cruel and hypocritical scheme," says Ms. Harris. "The perpetrators preyed on institutions of faith.”

The Attorney General's complaint states that Television Broadcasting Online, Urban Interfaith Network, Willie Perkins, and Michael Morris "engaged in a nationwide scam" in which they persuaded "195 African American churches in 15 different states to enter into expensive and onerous leases for shoddy computer equipment housed in wooden cabinets."

They promised the churches the kiosks would be free, advertisers would make the lease payments and the churches would be under no financial obligation, says the lawsuit.

According to the Attorney General's complaint, the leasing companies, Balboa and United, are liable because the other defendants were acting as their agents and because, even after the leasing companies learned of the misrepresentations, they failed to alert churches to the scam and vigorously continued to enforce the terms of the leases.