Finance Globe

U.S. financial and economic topics from several finance writers.
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Wachovia Bank Sends Restitution Payments to Fraud Victims

Since December 11, 2008, Wachovia Bank began mailing restitution checks totaling more than $150 million to victims of telemarketing fraud.

The checks are reimbursement for payments taken from Wachovia Bank customer's accounts, authorized without the customer's approval or knowledge, by fraudulent telemarketers and their payment processors.

This restitution is part of a settlement for allegations that the bank, headquartered in North Carolina, allowed the unauthorized withdrawals from customers' bank accounts even though they knew or should have known that the charges were not approved by the customer.

Today, the Federal Trade Commission (FTC) issued a statement urging recipients to cash these checks, assuring consumers the checks are legitimate. More than 740,000 Wachovia Bank customers are due to receive checks of varying amounts to reimburse them for unauthorized charges. In addition, victims will receive a claim form to recover bank fees that the consumer believes were imposed as a result of the unauthorized charges.

The Justice Department provides a website for consumers to confirm the validity of the checks at, or you can call toll-free at 1-866-680-6659. "Because victims may be apprehensive about depositing the restitution checks, a website and a toll free number have been created to address victims’ concerns and to answer questions. Recipients should carefully read the notice and all accompanying documents."

The FTC previously sued two of the payment processors in 2007 - Your Money Access, LLC doing business under a variety of names and Largo, Florida-based company Suntasia Marketing, LLC. The FTC also charged the telemarketers who knowingly obtained customers' bank account information under false pretenses, and "sold" a variety of worthless goods and services or enrolled customers in memberships that later proved impossible for the customer to cancel.

The Justice Department sued the third company - Payment Processing Company, LLC with attempting to fraudulently withdraw more than $140 million over a ten-month period from early 2005 through February 2006. This Bucks County, Pennsylvania company cost unsuspecting consumers more than $50 billion. PPC and its managers and owners are prohibited, for life, "from ever engaging in any activity in which unsigned bank drafts are used to process payments for telemarketers."

The FTC estimates that telemarketing fraud costs Americans about $40 billion every year, and that consumers age 65 or older account for about 85% of all telemarketing fraud victims. "Seniors are attractive targets for telemarketing fraudsters because they are more likely to be home to receive a telemarketers call, and are often too polite to hang up."

"These victims were lulled by fraudulent telemarketers into a false sense of security to give up their confidential banking information. It is gratifying to see Wachovia step up to restore the victims’ financial losses resulting from telemarketing fraud," said Acting United States Attorney Laurie Magid.

"This settlement is another demonstration of our government at work. These victims can rest assured that these checks are legitimate and that someone is looking out for their interests." Magid also encourages all consumers to be wary of releasing personal information over the telephone or to unknown vendors.

The Federal Trade Commission
U.S. Department of Justice
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Thursday, 25 April 2024

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