FTC Stops Operators of Fake Credit Repair Scheme

Alleges scammers charged upfront fees and falsely promised to improve credit scores

At the Federal Trade Commission’s request, a federal court has temporarily halted and frozen the assets of Grand Teton Professionals, an alleged credit repair scheme that charged illegal upfront fees and falsely claimed to repair consumers’ credit. The company and other defendants are charged with violating the FTC Act and several provisions of the Credit Repair Organizations Act, the Telemarketing Sales Rule, the Consumer Review Fairness Act, the Truth in Lending Act, and the Electronic Funds Transfer Act.

According to the FTC’s complaint, since at least 2014, two of the defendants, Douglas Filter and Marcio G. Andrade, have operated an unlawful credit repair scam that bilked consumers out of at least $6.2 million.

“A good credit score can help you buy a home, get a business loan, or finance an education,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “These companies preyed on consumers who wanted to clean up their credit by making false promises and taking illegal upfront fees.”

The FTC charges that the defendants, using such trade names as Deletion Experts, Inquiry Busters, and Top Tradelines, used deceptive websites, unsolicited emails, and text messages to target consumers with false promises of substantially improving consumers’ credit scores by claiming to remove all negative items and hard inquiries from consumers’ credit reports. The defendants also falsely claimed to substantially improve consumers’ credit scores by promising to add consumers as “authorized users” to other individuals’ credit accounts, a practice known as adding “tradelines” or “piggybacking” credit. In most instances, however, the defendants were not able to substantially improve consumers’ credit scores.

The complaint also alleges that the defendants charged illegal upfront fees and failed to provide consumers with required disclosures about their credit repair services. The defendants also advised consumers to mislead credit bureaus by filing false identity theft affidavits and to mislead lenders by claiming to be authorized users on other individuals’ credit accounts, according to the FTC.

In its complaint, the FTC charges that if a consumer complained about the lack of results or attempted to exercise their statutory rights to dispute the defendants’ illegal advance fees, the defendants would threaten them with legal action for violating purported anti-disparagement and anti-chargeback contract clauses. The defendants offered consumers the option of financing these substantial fees, but failed to make critical required disclosures. When the defendants processed fees, they routinely engaged in electronic fund transfers from consumers’ bank accounts without obtaining proper authorization. The defendants often used illegal remotely created checks to pay for the credit repair services they offered through telemarketing, according the FTC’s complaint.

Under the terms of the temporary restraining order granted by the court, the company has temporarily ceased operations and the defendants’ assets are frozen.

The corporate defendants are: Grand Teton Professionals, LLC; 99th Floor, LLC; Mait Management Inc.; Demand Dynamics LLC; Atomium Corps Inc. (a Wyoming company); Atomium Corps Inc. (a Colorado company); Startup Masters NJ Inc. (a Wyoming company); Startup Masters NJ Inc. (a New Jersey company); First Incorporation Services, Inc. (a Wyoming company); First Incorporation Services, Inc. (a Florida company); and individual defendants Douglas Filter and Marcio G. Andrade.

This article by the FTC was distributed by the Personal Finance Syndication Network.

FTC, Law Enforcement Partners Announce New Crackdown on Illegal Robocalls

U.S., state, and local enforcement stops companies responsible for over one billion calls

The Federal Trade Commission and its law enforcement partners today announced a major crackdown on illegal robocalls, including 94 actions targeting operations around the country that are responsible for more than one billion calls pitching a variety of products and services including credit card interest rate reduction services, money-making opportunities, and medical alert systems.

Call it Quits - Robocall Law Enforcement Operation 2019 logoThe joint crackdown, “Operation Call it Quits,” is part of the Commission’s ongoing effort to help stem the tide of universally loathed pre-recorded telemarketing calls. It also includes new information to help educate consumers about illegal robocalls. In addition, the FTC continues to promote the development of technology-based solutions to block robocalls and combat caller ID spoofing.

“Operation Call it Quits” includes four new cases and three new settlements from the FTC alone. The U.S. Department of Justice (DOJ) filed two of the new cases on the FTC’s behalf. Collectively, the defendants in these cases were responsible for making more than a billion illegal robocalls to consumers nationwide. Today’s announcement brings the number of cases the FTC has brought against illegal robocallers and Do Not Call (DNC) violators to 145.

“We’re all fed up with the tens of billions of illegal robocalls we get every year,” said Andrew Smith, Director of the FTC’s Bureau of Consumer Protection. “Today’s joint effort shows that combatting this scourge remains a top priority for law enforcement agencies around the nation.”

In addition to the actions by the FTC, 25 federal, state, and local agencies have brought 87 enforcement actions as part of the initiative. State partners announcing enforcement actions today include the Attorneys General Offices for Alabama, Arizona, Colorado, Florida, Illinois, Indiana, Michigan, Missouri, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Texas, and Virginia; the Consumer Protection Divisions of the District Attorneys for the Counties of Los Angeles, San Diego, Riverside, and Santa Clara, California; the Florida Department of Agriculture and Consumer Services; and the Los Angeles City Attorney. In addition, the United States Attorneys’ Offices for the Northern District of Georgia, Middle District of Florida, and Southern District of Texas, with support from the Treasury Inspector General for Tax Administration, have contributed five criminal actions.

“Every year, our office gets more consumer complaints about unwanted robocalls than just about any other issue,” said Indiana Attorney General Curtis Hill. “At best, these calls represent a nuisance for families just wanting to enjoy peace and privacy without needless disturbances interrupting their routines. At worst, they represent scams that successfully steal people’s identities or hard-earned money. In Indiana, we are quite serious about stopping illegal robocalls, and our alliances with such partners as the FTC will prove a valuable asset in this mission.”

Each FTC case is described below:

Robocalls - If you answer the phone and hear a recorded message instead of a live person, it's a robocall. Companies need your written permission to use robocalls to sell things to you. Why you're getting so many robocalls: Often it's scammers. The internet makes it cheap and easy for them to call from anywhere in the world. What you can do about them: 1. Hang up. If you press any numbers, you might get even more calls. 2. Use call blocking. Talk to your phone carrier and read expert reviews about your options. Report robocalls to the ftc at ftc.gov/complaint. Learn more at ftc.gov/calls.First Choice Horizon LLC

According to the FTC’s complaint against six corporate and three individual defendants jointly doing business as Second Choice Horizon and CSG Solutions, Raymond Gonzalez, Carlos S. Guerrero, and Joshua Hernandez ran a maze of interrelated operations that used illegal robocalls to contact financially distressed consumers with offers of bogus credit card interest rate reduction services. The FTC contends many of the consumers targeted were seniors. According to the complaint, the defendants deceptively told consumers that, for a fee, the defendants could lower their credit card interest rates to zero for the life of the debt, thereby saving the consumers thousands of dollars on their credit card debt.

The complaint alleges that the defendants robocalled consumers, including many whose phone numbers were on the DNC Registry. Under the guise of confirming consumers’ identities, the defendants tricked them into providing their personal financial information, including their Social Security and credit card numbers.

The FTC also alleges the defendants did not disclose to consumers that they would have to pay substantial additional bank or transaction fees. Finally, the FTC alleges that in many instances, consumers who did not buy the services later found out that the defendants had applied for one or more credit cards without their knowledge or consent.

The case was filed in the U.S. District Court for the Middle District of Florida, Orlando Division, on June 3, 2019. On June 4, 2019, the court granted the FTC’s request for a temporary restraining order against the defendants, including an asset freeze and the appointment of a receiver. The FTC acknowledges the assistance of the Better Business Bureau Serving Central Florida and the Florida Department of Agriculture and Consumer Services.

8 Figure Dream Lifestyle

According to the FTC’s complaint against five corporate and four individual defendants, since at least 2017 the defendants have used a combination of illegal telemarketing robocalls, live telephone calls, text messaging, internet ads, emails, social media, and live events to market and sell consumers fraudulent money-making opportunities. The defendants operated under the names 8 Figure Dream Lifestyle and Online Entrepreneur Academy.

Throughout their marketing, according to the FTC, the defendants consistently made false or unsubstantiated claims about how much consumers can earn through their programs, often claiming that a typical consumer with no prior skills can make $5,000 to $10,000 in 10 to 14 days and $10,000 or more within 60 to 90 days of buying the program. In reality, the complaint states, consumers who bought the 8 Figure Dream Lifestyle program for between $2,395 and $22,495 rarely earned substantial income, typically lost their entire investment, and often incurred significant loans and credit card debt.

The complaint further states that in marketing the Online Entrepreneur Academy—a spin-off of 8 Figure Dream Lifestyle—defendants Alex Dee, Brian M. Kaplan, and Jerrold S. Maurer deceptively promoted the program in the same way and claimed without substantiation that consumers who joined would make tens of thousands of dollars in 60 to 90 days.

The Commission’s complaint charges the defendants, who operate from California, Colorado, New York, and Tennessee, with violating the FTC Act, the Telemarketing Sales Rule (TSR), or both, by making deceptive earnings claims through robocalls and other marketing techniques.

The case was filed in U.S. District Court for the Central District of California on June 12, 2019. On June 13, 2019, the court granted the FTC’s request for a temporary restraining order against the defendants, including an asset freeze. The full list of defendants is included in the FTC’s complaint.

Derek Jason Bartoli

According to the FTC’s complaint against Derek Jason Bartoli, the Florida-based defendant has been an active participant in the illegal telemarketing industry for several years, serving as the “dialer,” “information technology (IT) guy,” and at times the seller for various telemarketing companies, including companies that the FTC and other law enforcement agencies have sued. He provided services in his own name and in the names of Phoenix Innovative Solutions LLC, Marketing Consultation Solutions LLC, and KimRain Marketing LLC.

The FTC alleges that Bartoli is the developer, operator, and provider of a computer-based telephone dialing platform, also known as an autodialer. He used the autodialer to blast out millions of illegal robocalls and calls to phone numbers listed on the DNC Registry. In the last six months of 2017 alone, the complaint alleges that Bartoli sent more than 57 million calls to registered phone numbers. In addition, the complaint alleges that he initiated millions of calls using fake or “spoofed” caller ID information.

The proposed court order settling the FTC’s charges permanently bans Bartoli from calling phone numbers listed on the DNC Registry, from sending robocalls, and from using deceptive caller ID practices, such as “spoofing.”

The order also prohibits Bartoli from a range of deceptive and abusive telemarketing practices, including interfering with a person’s right to be placed on a do not call registry, calling consumers who have previously said they do not want to be called, violating the FTC’s TSR, and failing to pay for access to DNC Registry information. Finally, the order imposes a $2.1 million civil penalty against Bartoli, which will be suspended due to his inability to pay.

The DOJ filed the complaint and order on the FTC’s behalf in the U.S. District Court for the Middle District of Florida. The defendants in this case include Derek Jason Bartoli, individually and doing business as Phoenix Innovative Solutions LLC, Marketing Consultation Solutions LLC, and KimRain Marketing LLC. The FTC acknowledges the assistance of USTelecom and the Florida Department of Agriculture and Consumer Services.

Media Mix 365, LLC

According to the FTC’s complaint against Media Mix 365, also doing business as Solar Research Group and Solar Nation, and its owners Nicholas J. Long and Nicole J. Long, a/k/a Nicole Leonard and Nicole Leonard-Long, the defendants made illegal calls to develop leads for home solar energy companies.

The FTC alleges that since at least 2015, Media Mix has called millions of phone numbers on the DNC Registry and has repeatedly or continuously called consumers with the intent of annoying, abusing, or harassing them. The defendants allegedly called one number more than 1,000 times in a single year. The FTC alleges the California-based defendants were named in at least three other lawsuits, including two class action cases charging them with DNC Registry violations.

The proposed court order settling the FTC’s charges permanently bans Nicholas and Nicole Long from calling phone numbers listed on the DNC Registry and from robocalling. It also prohibits Media Mix 365 from calling phone numbers listed on the DNC Registry unless it has the express, written agreement of the recipient to receive such calls or has an established business relationship with the recipient.

The order bars Media Mix from robocalling unless the recipient has provided an express written agreement to be robocalled. The order further prohibits the defendants from repeatedly or continuously calling with the intent to annoy, abuse, or harass the call recipients and from violating any provisions of the TSR. Finally, the order imposes a $7.6 million civil penalty, which will be suspended upon payment of $264,000.

The DOJ filed the complaint and order on the FTC’s behalf in the U.S. District Court for the Central District of California. The FTC acknowledges the assistance of the Texas Attorney General’s Office.

Other FTC Actions

In addition to the new cases announced today, the Commission has also settled several cases brought previously. Each complaint and proposed settlement order is described below:

Lifewatch, Inc.

According to the FTC’s July 2015 complaint, filed jointly with the Florida Attorney General’s Office, since 2012 the defendants bombarded primarily elderly consumers with at least a billion unsolicited robocalls to pitch supposedly “free” medical alert systems. The defendants often called consumers whose numbers were on the DNC Registry and typically “spoofed” caller ID information.

The defendants used pre-recorded messages, including one supposedly from “John from the shipping department,” which were meant to sound like a live person that falsely told consumers that a medical alert system had been purchased for them, and they could receive it “at no cost whatsoever.” The complaint alleges that the pre-recorded messages frequently falsely claimed that their medical alert system had been endorsed or recommended by reputable organizations like the American Heart Association, American Diabetes Association, National Institute on Aging, or the AARP.

Consumers who eventually spoke with a live operator allegedly were told that even though the system cost over $400, they would get it for free. However, the complaint alleges the telemarketers refused to answer questions about who bought the system for them. The telemarketers also allegedly told consumers they would not be charged any monitoring fee until they received and “activated” the system, even though the consumers’ credit or debit cards were charged immediately. According to the complaint, the telemarketers also often falsely reassured consumers that they could cancel their service at any time without any further financial obligation.

The court order announced today contains provisions related to two sets of defendants: 1) the Lifewatch defendants, which includes Lifewatch, Inc., Evan Sirlin, and Mitchel May; and 2) the Roman defendants, which includes Safe Home Security, MedGuard Alert, Inc., and David Roman. The order permanently bans the Lifewatch defendants from telemarketing and prohibits them from misrepresenting the terms associated with the sale of any product or service. It also imposes a financial judgment of $25.3 million against Lifewatch and Sirlin.

The order permanently bans the Roman defendants from robocalling, calling consumers whose phone numbers are on the DNC Registry, and calling anyone who is on an entity-specific do not call list. It also bans the Roman defendants from “spoofing” caller ID information and prohibits them from abusive telemarketing practices, including failing to identify themselves to consumers they call, violating the TSR, and misrepresenting the terms associated with the sale of any product or service. Finally, it imposes financial judgments of $8.9 million against the Roman defendants. The financial judgments will be partially suspended after the Lifewatch and Roman defendants pay $2 million.

The order also requires that the defendants notify all current customers about the false claims and illegal robocalls made on their behalf, and give those customers the opportunity to cancel their service.

The FTC filed the order in the U.S. District Court for the Northern District of Illinois, Eastern Division. The FTC thanks its co-plaintiff, the Florida Attorney General’s Office, and acknowledges the assistance of the Indiana Attorney General’s Office, the Florida Department of Agriculture and Consumer Services, the Better Business Bureau of Eastern Missouri, the American Heart Association, the American Diabetes Association, the National Institute on Aging, and AARP.

Redwood Scientific

The FTC’s October 2018 complaint against Redwood Scientific charged the defendants with a scheme that used illegal robocalls to deceptively market dissolvable oral film strips as effective smoking cessation, weight-loss, and sexual-performance aids. The FTC’s complaint alleges that in addition to making misleading claims about the strips, the company enrolled customers in auto-ship continuity plans without their consent, and did not honor the advertised money-back guarantees.

The court-approved settlement announced today resolves the FTC’s charges against one defendant in the case, Danielle Cadiz. The order permanently bans Cadiz from all robocall activities, including ringless voicemails. The order prohibits her from making a wide range of misleading or deceptive health-related claims. It also prohibits deceptive claims related to third-party endorsements and testimonials, and the U.S. origin of a product. The order requires Cadiz to get consumers’ express consent before enrolling them in auto-ship continuity plans and to enable consumers to easily cancel their enrollment.

The order imposes a judgment of $18.2 million against Cadiz, which will be suspended based on her inability to pay. The order was entered by the U.S. District Court for the Central District of California. Litigation continues against the remaining defendants.

Life Management Services

According to the FTC’s June 2016 complaint, brought jointly with the Florida Attorney General’s Office, the Life Management defendants bombarded consumers with illegal robocalls in attempts to sell them bogus credit card interest rate reduction services. According to the complaint, the defendants guaranteed that they could substantially and permanently lower consumers’ credit card interest rates and save them thousands of dollars in interest payments. Consumers allegedly made up-front payments but rarely, if ever, got the promised services. The complaint also alleges that the defendants used illegal robocalls to pitch a bogus credit card debt elimination service.

The court order announced today permanently bans 17 Life Management defendants from engaging in telemarketing and debt relief services. It also imposes a judgment of $23.1 million against them, jointly and severally, which will be suspended after they turn over virtually all their assets. The order also resolves the Commission’s claims against two relief defendants who were not directly involved in the scheme, but benefitted from it financially. It settles the FTC’s charges against all remaining defendants in this matter. The FTC won summary judgment and obtained a permanent injunction and monetary relief against scheme leader Kevin Guice in December 2018.

The FTC filed the orders in the U.S. District Court for the Middle District of Florida, Orlando Division. The FTC thanks its co-plaintiff, the Florida Attorney General’s Office, and acknowledges the assistance of the Florida Department of Agriculture and Consumer Services.

The Commission votes approving all the aforementioned law enforcement actions were 5-0, except for the proposed final orders in the Life Management Services case, which was 2-0.

Information for Consumers

The FTC’s one-stop shop for consumers looking for information on what to do about robocalls and other unwanted calls can be found at ftc.gov/calls. In addition to updated articles and infographics, consumers will find three new short videos about stopping unwanted calls. Consumers looking for additional information on ways to limit illegal robocalls can click here.

The FTC would like to thank its partners for providing consumer education outreach and support for “Operation Call it Quits,” including the Attorneys General Offices for Alabama, Arizona, Colorado, Connecticut, Delaware, the District of Columbia, Florida, Idaho, Illinois, Iowa, Kentucky, Louisiana, Michigan, Mississippi, Nevada, New Hampshire, New Jersey, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, West Virginia, and Wyoming; the Alaska Department of Law; the Consumer Protection Division of the District Attorney for the County of Los Angeles, California; the Florida Department of Agriculture and Consumer Services; the Los Angeles City Attorney; the New York Department of State’s Division of Consumer Protection; and the Utah Department of Commerce’s Division of Consumer Protection.

NOTE: The Commission files a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court. Stipulated final orders have the force of law when approved and signed by the district court judge.

This article by the FTC was distributed by the Personal Finance Syndication Network.

The lead-generation bait-and-switch

You’ve probably shared your contact information online to, say, get details about a job opening. Usually, that’s fine. But sometimes you might be looking for one thing and wind up getting something else – like calls about stuff you never asked for or wanted.

Lead generators are companies that collect your contact information, then sell it to marketers who use it to promote their own products and services. While some lead generators are upfront about what they do with your information, others trick you into sharing it for their own profit – regardless of what you asked for.

The FTC sued Day Pacer, LLC for allegedly making unwanted calls as part of a scheme that used just this kind of bait-and-switch. According to the lawsuit, Day Pacer is a lead generator that got its leads from websites with convincing graphics and language to make people think they were in the right place to get what they needed. People went to these websites and shared their phone numbers to get help applying for jobs, health insurance, unemployment benefits and other assistance. But that’s not what they got. Instead, people got unwanted phone calls from Day Pacer with sales pitches to enroll in post-secondary and vocational schools operated by its clients. The company disturbed millions of people with these calls – even though their numbers were on the National Do Not Call Registry.

When you search online for jobs, benefits, or government assistance, you want to be sure you wind up where you need to be. So, once you have your search results:

  • Check out the URL before you click. Search online for that URL, plus the words “review” or “complaint.” Do the same thing with the company name, if you can find it. That will tell you what other people have experienced with that site.
  • Look for sites with “.gov” in the URL. Of course, there are many reliable, non-government, online sources. But government sites are the safest bet. So, for example:

And if you know someone who’s gone through this kind of bait-and-switch, report it to the FTC.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Jumpstart your savings with Start Small, Save Up

National Tax Day was April 15. For many Americans, their tax refund is one of the biggest checks they’ll receive all year. If you received a tax refund, consider setting some of it aside as savings. Sometimes “life happens,” so having a rainy day fund to cover unexpected expenses throughout the year may help you breathe a little easier.

If you feel like you’re living paycheck to paycheck or always coming up short, it’s difficult to think about putting any money aside. And, you’re not alone. According to a study conducted by the Federal Reserve Board, 40 percent of Americans could not come up with $400 to cover an emergency expense, or would do so by borrowing money or selling something. 

CFPB recently launched the Start Small, Save Up campaign to provide tools and strategies to help Americans to save. A few small steps can really add up and help you realize your dreams for the future, regardless of whether it’s creating security for a rainy day, saving for your dream house, or building towards retirement.    

Learn how you can start small now and create lasting change.

This article by was distributed by the Personal Finance Syndication Network.

SSA imposters top IRS in consumer loss reports

Have you gotten calls about supposed problems with your Social Security number from callers pretending they’re with the Social Security Administration (SSA)? If so, you’re not alone. Our latest Data Spotlight finds that reports about SSA imposters are surging, while reports about IRS imposters have taken a dive.

As the Spotlight puts it, “In the shady world of government imposters, the SSA scam may be the new IRS scam.” While reports of SSA imposters have swelled – nearly half of the reports we’ve gotten in the last year have come in the past two months alone – reports of IRS scammers have plunged. What’s more, people told us they lost $19 million to SSA imposters in the past year. That overtakes the $17 million reported lost to IRS imposters in 2016, the peak year of the IRS scam.

How can you spot SSA imposters? They often use robocalls to reach you, then launch into a story aimed at tricking you into giving them your money, your Social Security number (SSN), or both. They may say your SSN has been suspended and you need to confirm your SSN to reactivate it. Or, they may say your SSN has been involved in a crime and your bank account is about to be seized or frozen, but you can protect your money if you put it on a gift card and give them the code. Never do that – your money will disappear.

If you get one of these calls, remember – the real SSA will never contact you out of the blue or tell you to put money on a gift card or, for that matter, visit a Bitcoin ATM, or wire money. If your caller ID shows a number that looks like it belongs to the SSA, don’t trust the number – scammers fake their caller ID all the time. If you’re worried, hang up and call the SSA yourself at 1-800-772-1213.

Check out the Data Spotlight for more information. If you think a scammer has your Social Security number, visit IdentityTheft.gov/ssa to learn what you can do.

Hang up on Social Security Scammers

This article by the FTC was distributed by the Personal Finance Syndication Network.

A no-cost way to prepare your credit for a big purchase

Thinking about buying a house, car, or other big ticket item, and know you’ll be using credit? Before making a big purchase, your first step should be to take a look at all of your finances. Check out these five steps to prepare your finances that won’t cost you a penny.

1. Take advantage of your free annual credit reports.

You can visit AnnualCreditReport.com to get a copy of your credit reports for free. The three nationwide credit reporting companies – Experian, TransUnion, and Equifax — each have to provide your free credit reports every 12 months – but only if you request them. You can check the three reports periodically throughout the year or all at once. If you decide to request one report every four months, you can monitor your credit reports more frequently throughout the year.

2. Review your credit reports for inaccurate information.

Take a close look at your credit reports to make sure all the information on your report is correct. According to an FTC study , one in five people have errors on their credit report. Not sure what to look for? Here’s a list of common credit report errors to help you through the process.

3. Dispute credit report errors with the credit reporting company that sent you the report.

Incorrect information on your credit report may hurt your ability to get new lines of credit or may make the terms of credit more expensive. You can dispute inaccurate information with the credit reporting company. You can use these instructions and template letter as a guide.

4. Dispute credit report errors to the company that provided the information.

The company that provided or “furnished” the information to the credit reporting company is known as the “furnisher.” Furnishers could be your bank, your landlord, or your credit card company. You can dispute inaccurate information directly with the furnisher. Use this template to send a letter to the company that provided the information you’re disputing.

5. Make a plan.

Even if you don’t have errors on your credit report, reviewing your report can help you make a plan for how to improve your credit. For more help putting your plan together, download this guide to Rebuilding Your Credit .

This article by was distributed by the Personal Finance Syndication Network.

FTC Charges Telemarketing Operation with Misleading Job Seekers and Making Millions of Illegal, Unsolicited Calls

Alleges defendants make unsolicited calls about educational programs to consumers who submitted their contact information to job and benefits websites

The Federal Trade Commission has charged a telemarketing operation and its owners with making millions of illegal, unsolicited calls about educational programs to consumers who submitted their contact information to websites promising help with job searches, public benefits, and other unrelated programs.

According to the FTC’s complaint seeking civil penalties, corporate defendants Day Pacer, LLC and Edutrek, L.L.C., and individual defendants Raymond Fitzgerald, Ian Fitzgerald, and David Cumming, obtain consumers’ phone numbers from websites that claim to help consumers apply for jobs, health insurance, unemployment benefits, Medicaid coverage, or other forms of assistance. Instead of offering these services, the defendants and their affiliates call consumers to market vocational or post-secondary education programs, according to the FTC.

“Telemarketers have a duty to ensure that they are not placing calls to people on the National Do-Not-Call Registry,” said Andrew Smith, Director of the Bureau of Consumer Protection, “And they cannot rely on affiliate websites that use fine print and other deceptive tactics to lure consumers.”

The job and benefits websites allegedly use different tactics, like small print, to hide their telemarketing purpose. For example, in the exhibit below, the web page states, “Jobs In Your Area” and “Thousands of Government Jobs In Your Area Are Looking to Hire Immediately,” and includes the misleading seals of several federal government agencies. At the bottom of the page is a block of small text that is illegible without substantial magnification. It states that clicking the “submit” button to request information about government jobs provides “consent” to receive telemarketing calls about various subjects unrelated to obtaining a government job.

FTC Exhibit: screenshot of website claiming to find government jobs for users

Similarly, the complaint alleges that the defendants have purchased leads from “FindFamilyResources.com,” a website offering to provide information about Temporary Assistance to Needy Families (TANF), welfare benefits, and unemployment insurance. The exhibit below shows a landing page that tells consumers they may “Learn More About Benefits Assistance” by submitting contact information in the boxes provided onscreen. The “yes” or “no” checkbox asking for consent to receive telemarketing calls is placed directly under an unrelated question about residency and age.

FTC Exhibit: screenshot of website claiming to help users find information about government assistance

The defendants are charged with violating the Telemarketing Sales Rule by initiating over five million unsolicited outbound telemarketing calls to numbers on the Do Not Call Registry since 2013, and by providing substantial assistance to other telemarketers who placed calls to numbers on the Do Not Call Registry.

The Commission vote authorizing the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Northern District of Illinois on March 29, 2019, after being referred back to the FTC by the U.S. Department of Justice.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest.

The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Online Lending Company Agrees to Settle FTC Charges It Engaged in Deceptive and Unfair Loan Servicing Practices

Avant to pay $3.85 million for harming thousands of consumers

Avant, LLC, an online lending company, has agreed to settle the Federal Trade Commission’s charges that it engaged in deceptive and unfair loan servicing practices, such as imposing unauthorized charges on consumers’ accounts and unlawfully requiring consumers to consent to automatic payments from their bank accounts.

“We have alleged that Avant gave the run-around to consumers trying to repay their loans, because of systemic issues with the company’s loan servicing platform,” said Andrew Smith Director of the FTC’s Bureau of Consumer Protection. “Online lenders need to understand that loan servicing is just as important to consumers as loan marketing and origination, and we will not hesitate to hold lenders liable for unfair or deceptive servicing practices.”

According to the FTC’s complaint, Avant offers unsecured installment loans for consumers through its website. The FTC charged that in many cases, the company falsely advertised that it would accept payments by credit or debit cards, when in fact it rejected these forms of payments. The FTC also alleged that the company withdrew money from consumers’ accounts or charged their credit cards without authorization.  In some instances, Avant charged consumers duplicate payments without authorization, improperly taking consumers’ monthly payments twice or more in one month.  For example, one consumer’s monthly payment was debited from his account 11 times in a single day.

In many cases when consumers complained about the unauthorized charges, Avant  allegedly insisted that the consumers authorized the charges and refused to provide a refund. Despite hundreds of consumer complaints about unauthorized charges and internal documents repeatedly acknowledging this problem, the company continued to charge consumers without authorization, according to the FTC.

The Commission has also charged the online lending company with the following law violations:

  • failing to properly and timely credit payments made by check;
  • providing inaccurate payoff quotes to consumers;
  • collecting additional amounts even after consumers paid the quoted payoff amount; and
  • violating the Telemarketing Sales Rule and the Electronic Fund Transfer Act by requiring borrowers to agree to recurring automatic debits of their bank account as a condition of obtaining a loan.

The stipulated final order imposes a judgment of $3.85 million, which will be returned to consumers who were harmed by Avant’s unlawful practices.

Under the settlement order, Avant, LLC will be prohibited from taking unauthorized payments and from collecting payment by means of remotely created check (RCC). The company also is prohibited from misrepresenting: the methods of payment accepted for monthly payments, partial payments, payoffs, or any other purpose; the amount of payment that will be sufficient to pay off in its entirety the balance of an account; when payments will be applied or credited; or any material fact regarding payments, fees, or charges.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Ask a health professional before popping that pill

When I was young, I wanted the shoes that would make me run faster and jump higher. Now, I wish my brain would run a little faster when I can’t remember my account passwords. Unfortunately, some shady outfits have been trying to “help” people like me by making some mind-blowing claims to sell their dietary supplements.

The FTC just settled charges against four people and a dozen businesses that sold bottles of “cognitive enhancement” supplements through a collection of websites, including fake news websites. The FTC says the defendants falsely claimed Geniux, Xcel, EVO, and Ion-Z could increase users’ focus, concentration, IQ, and brainpower. The settlement bans them from making false or unsupported health claims and requires them to pay over $600,000.

According to the FTC, the defendants didn’t have proof that Geniux can increase concentration by 312 percent, boost brainpower by up to 89.2 percent, and enhance memory recall. They made these claims on websites designed to look like real news sites and featuring false claims that Bill Gates, Elon Musk and Stephen Hawking got dramatic results from Geniux. The FTC also says that customers — who paid up to $57 per bottle — couldn’t get a promised 100% money back guarantee.

If you’re considering a dietary supplement, remember: the government doesn’t review or evaluate supplements for safety or effectiveness before they’re put on the market. Your health care professional is the most important person to ask whether a supplement is safe for you. Even a natural supplement can be risky depending on your health and the medicine you take. If you see an ad with claims about miracle cures, ask a professional about the science behind the claims. If you think a product is being advertised falsely, please tell the FTC at FTC.gov/Complaint.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Financial tips for 2019 graduates

Congratulations students and parents! It won’t be long before young people across the country will put on their caps and gowns to celebrate their graduations. Many graduation speakers offer advice, some based on their own life experiences. The FTC has some practical advice to offer, too.

April is Financial Literacy Month and a great time to start planning for your financial future. The FTC has a library of free consumer materials, including a blog and media room, to help you make the most of your money and avoid costly scams.

Check out consumer.gov for basic, easy-to-read tips on budgeting, getting credit, renting a place to live, dealing with identity theft, and buying a car. And if you’re looking for a job, scammers may be looking for you. Some job placement firms misrepresent their services, promote nonexistent vacancies, or charge high fees in advance for services that don’t guarantee placement.

Speaking of scams, you might be surprised to learn that, according to recently released FTC data, younger people reported losing money to fraud more often than older people. It’s what the data has been telling us for a while, but it’s hard for people to grasp. Last year, based on those who reported fraud and gave us their age, 43% of people in their 20s reported a loss to that fraud, while only 15% of people in their 70s did. Check out 10 Things You Can Do to Avoid Fraud to help stay a step ahead of the scammers.

This article by the FTC was distributed by the Personal Finance Syndication Network.