Scam Report

$1.7m Set to be Returned to Credit Card Scam Victims

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$1.7m Set to be Returned to Credit Card Scam Victims
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1,244 checks being sent to people contacted via illegal robocalls and sold scam credit card interest rate reduction services

In May 2015, a Florida district court ordered several defendants in the FTC’s case against the Treasure Your Success robocall scheme to pay more than $1.7 million to the Commission. The FTC is using that money to provide full refunds that average more than $1100 each.

Using illegal robocalls to bait consumers, the defendants promised to lower people’s credit card interest rates and to save them thousands of dollars, in exchange for an upfront fee. After collecting the fee, they failed to provide the promised interest rate reductions or the savings.

Universal Processing Services (UPS) of Wisconsin, LLC, a payment processor, and telemarketer Hal E. Smith and his company HES Merchant Services Company, Inc. (HES), defendants in the Federal Trade Commission’s case against a deceptive robocall credit card interest rate reduction scheme, were jointly ordered to pay $1,734,972 to the Commission by a Florida district court. The money will be used to provide refunds to defrauded consumers.

“The defendants blasted thousands of people with illegal robocalls and lied about helping relieve their credit card debt,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “Now they’re out of the robocall business. The court’s decision also shows that it’s bad business for payment processors to help scammers take people’s money.”

The final orders announced today against UPS, which did business as Newtek Merchant Solutions, Smith, and HES follow the court’s November 2014 order granting the FTC’s motion for summary judgment against these three defendants who took part in the Treasure Your Success (TYS) scheme.

The rest of the defendants had previously agreed to final orders settling the agency’s charges against them.

The court held Smith and HES liable for 11 violations of the FTC Act and the Commission’s Telemarketing Sales Rule (TSR), based on their participation in a deceptive telemarketing scheme purporting to be a credit card interest rate reduction service that used robocalls to solicit consumers.

The defendants failed to disclose the identity of the person(s) responsible for placing the robocalls and unlawfully calling numbers that had been registered on the FTC’s Do Not Call Registry.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357).

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