The Federal Trade Commission has settled two actions that charged marketers with claiming they could reduce consumers’ credit card interest rates. Both operations allegedly made deceptive telemarketing calls, called consumers on the Do-Not-Call Registry, and used illegal robocalls. The settlements will ban all of the defendants from selling debt relief services.
The FTC charged that Advanced Management Services NW LLC, and several co-defendants called consumers and claimed that they could negotiate with credit card issuers to substantially lower the consumers’ credit card interest rates.
They allegedly delivered prerecorded “robocalls” with messages urging consumers to “press one” to speak with someone. Many consumers believed the calls came from their credit card company.
The defendants charged consumers up to $1,590 and promised a refund if they failed to deliver at least $2,500 in interest rate savings. But, instead of arranging reduced interest rates, the defendants sent consumers instructions to pay down their credit card debts early to save money on interest.
Consumers who demanded refunds allegedly were denied outright, got the run-around, or had a $199 “nonrefundable fee” deducted from their refund.
Under two settlement orders, all of the Advanced Management Services defendants are banned from selling debt relief services. The defendants, who were based in Washington and Texas, are also prohibited from misrepresenting material facts about any good or service, selling or using customers’ personal information, failing to properly dispose of customer information, and collecting payments from their debt relief customers.
An order against PDM International Inc., also doing business as Priority Direct Marketing International Inc., and William D. Fithian, also bans them from telemarketing and from violating the FTC’s Telemarketing Sales Rule, and imposes a $13.8 million judgment.
The order against Advanced Management Services NW LLC, also doing business as AMS Financial, Rapid Reduction Systems and Client Services Group; Rapid Reduction System’s LLC; Ryan David Bishop; and Michael L. Rohlf; imposes an $8.1 million judgment. Both judgments, which represent the total amount of money consumers lost, will be suspended when the defendants have surrendered virtually all of their assets - including several luxury cars, a boat, jet skis and ATVs. The full judgments will become due immediately if the defendants are found to have misrepresented their financial condition.
In a second case, the FTC alleged that Dynamic Financial Group and other defendants told consumers that, for an up-front fee of up to $1,995, they could save consumers thousands of dollars by reducing their credit card interest rates, and help them pay off their debts faster.
The FTC further charged that the defendants promised, falsely, a full refund if consumers did not save a "guaranteed" amount – typically $2,500 or more. However, the defendants allegedly did not negotiate lower interest rates for consumers or failed to provide refunds.
Under five settlement orders, all of the defendants are banned from selling debt relief services. These defendants, who are based in Canada, Florida and New Jersey, also are prohibited from misrepresenting material facts about any good or service, violating the Telemarketing Sales Rule, collecting payments from their debt relief customers, using or selling customers’ personal information and failing to properly dispose of customer information.
The order is specifically against 2145183 Ontario Inc., also doing business as Dynamic Financial Resolutions Inc.; The Dynamic Financial Group (U.S.A.) Inc.; R&H Marketing Concepts Inc.; America Freedom Advisors Inc.; Joseph G. Rogister; and Christopher M. Hayden. It bans them from robocalling and imposes an $8.3 million judgment that will be suspended because of the defendants’ inability to pay.
The order against Thriller Marketing LLC, Dwayne J. Martins, and John L. Franks Jr. imposes a $4.9 million judgment that will be suspended when Martins has surrendered the proceeds from selling a 2005 BMW 645 and Franks has surrendered the proceeds from selling two business condominiums in Tampa, Fla.
The order against Frank Porporino Jr. also bans him from robocalling and imposes an $8.3 million judgment that will be suspended when he has surrendered certain assets. In each case, the full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
Orders against Michael Falcone and Sean Rogister ban them from robocalling and impose judgments of $93,137 and $90,473, respectively, which must be paid immediately.
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