Finance Globe

U.S. financial and economic topics from several finance writers.
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FTC Cracking Down on Scammers

Organizations that prey on consumers who have been hurt by the economic downturn are the target of an ongoing crackdown by the Federal Trade Commission.

The FTC announced today that it halted the operations of Florida-based robocallers that allegedly promised to lower consumers’ credit card interest rate, but did nothing to fulfill their claims.

According to the FTC’s complaint, JPM Accelerated Services allegedly made thousands of illegal pre-recorded robocalls to credit card holders, identifying themselves only as “card services.”

When consumers responded to the prompt to continue with the call for more information, they were redirected to a sales associate who promised that their credit card interest rate could be drastically reduced, with a money-back guarantee for the upfront fee ranging from $495 to $995, the FTC alleges.

But after the organization received their money, they did nothing to help the consumers’ interest rates and did not honor their money back guarantee, the FTC complaint states.

JPM Accelerated Services is also being charged with with violating the Telemarketing Sales Rule by calling consumers on the Do Not Call Registry, blocking or “spoofing” caller ID, and making unlawful robocalls.

Robocalls, which are prerecorded sales calls, were made illegal last year. The only exception is if the consumer specifically gives the telemarketing company advance permission to make such calls.

The robocall rule applies to any prerecorded calls made in an effort to sell a product or service even if the consumer is already doing business with the telemarketing company. The rule does not apply to prerecorded messages that are for informational purposes, such as doctor appointment reminders or school cancellation bulletins.

The FTC also announced that they have put a stop to another organization that allegedly put out misleading ads and falsely told consumers they could erase up to 60% of their credit card debt.

According to the FTC, the defendants did business under the names of 800 Credit Card Debt and debt.com. The ads allegedly featured phony testimonials by people claiming to be the company’s customers.

Part of the company’s marketing included ads that claimed to be part of a public, non-commercial program by stating, “The following is a public announcement . . . Americans who are behind on their credit card payments must take action immediately. If YOU have ten thousand dollars or more in credit card debt, a new relief program is now available. . .”

The FTC alleges that the company made claims of being able to reduce consumers’ debt, and actually provided no debt relief service - but merely sold sales leads generated by their ads to debt settlement providers, or to other lead generators or lead brokers that re-sold them.

As a result of the FTC charges, the operators of 800 Credit Card Debt have been banned from operating in the debt settlement business. The settlement order imposes a whopping $28.2 million judgment that will be suspended when the defendants surrender all funds in their corporate bank accounts, as well as the proceeds from the sale of the defendants two properties in California, his real estate in the Virgin Islands, and his ownership interests in two overseas investment funds. The full judgment will be imposed immediately if the defendants have misrepresented their financial condition.

Consumers should protect themselves from being scammed by organizations that prey on the financially distraught. If you hear a sales pitch that sounds too be good to be true, keep in mind that it probably is. Check with the Better Business Bureau and thoroughly research any company you’re considering doing business with, before you pay them any money.

And finally, if you suspect you’ve been scammed, report the incident to your state’s attorney general and the FTC at www.ftc.gov.

Source:
Federal Trade Commission
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Friday, 22 November 2019

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