“Consumers who find themselves living with debt can feel like they are trapped in a downward spiral, struggling to find assistance to meet their financial obligations. It is reprehensible that fraudsters would exploit the trust of individuals searching for financial stability—often leaving them in even greater debt,” Florida Attorney General Ashley Moody said. “These telemarketing scammers hid their identities and reaped millions of dollars at the expense of vulnerable consumers.”
The defendants blasted consumers with telemarketing cold calls promising to permanently and substantially reduce their credit card interest rates. After tricking consumers into believing they were affiliated with the consumer’s existing credit card companies or well-known credit card networks such as MasterCard or Visa, the defendants promised to save them thousands of dollars in credit card interest and enable them to pay off their credit card debt three to five times faster. The defendants charged upfront fees of as much as $3,995 for their bogus services.
Many consumers who paid the defendants’ significant upfront fees received no permanent debt reduction and were left with more debt and worse credit. Instead of contacting the consumer’s credit card companies to negotiate permanently and substantially lower interest rates, the defendants applied for new credit cards in their names with temporarily lower “teaser” interest rates. They then executed balance transfers from the consumer’s existing cards to the new cards. These tactics not only failed to provide many consumers the savings they were promised but also often left them saddled with substantial balance transfer fees, on top of the upfront fees they paid.
TIPS
It is important to remember that the FTC’s Telemarketing Sales Rules specifically prohibit charging advance fees before providing any debt relief services. Any company that requires an advance fee before they have completed their successful debt reduction services is breaking the law. You also may want to consider avoiding scams like this by enrolling in the federal Do Not Call List so that if you are contacted by a telemarketer, you already know it would be someone who is knowingly breaking the law and cannot be trusted. Registering for the Do Not Call List is easy and free. Merely go to http://www.donotcall.gov to register your phone number.
If you need real credit counseling you can go to this section of the Department of Justice’s website where it lists agencies approved to assist consumers with debt problems. https://www.justice.gov/ust/list-credit-counseling-agencies-approved-pursuant-11-usc-111 You also may consider contacting companies that are affiliated with the National Foundation for Credit Counseling at this link https://www.nfcc.org/
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