Richard B. Newman
Member
The Federal Trade Commission and the State of Florida have filed a complaint for permanent injunction and other relief against the operators of an alleged debt relief scam that purportedly bilked millions of dollars from financially strapped consumers, including the elderly and disabled.
According to the complaint, the defendants convinced consumers to pay hundreds or thousands of dollars a month by falsely promising they would pay, settle or obtain dismissals of consumers’ debts and improve their credit.
The FTC alleges that victims found their debts unpaid, their accounts in default and their credit scores severely damaged.
The FTC and Florida allege that the defendants falsely claimed non-profit status to appear more credible and legitimate.
The defendants allegedly promised consumers guaranteed debt consolidation loans with favorable interest rates and low monthly payments. Once consumers agreed to the purported loan, the FTC alleges, the defendants repeatedly debited the consumers’ bank accounts.
The FTC and Florida OAG charge that the defendants failed to extend consumers the promised debt consolidation loans.
The defendants also purportedly called consumers that were already enrolled with debt relief providers claiming they were taking over the servicing of the accounts and falsely representing that they would provide the same or similar services.
The defendants are charged with violating the FTC Act, the FTC’s Telemarketing Sales Rule and the Florida Deceptive and Unfair Trade Practices Act.
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ADVERTISING MATERIAL. These materials are provided for informational purposes only and are not to be considered legal advice, nor do they create a lawyer-client relationship. No person should act or rely on any information in this article without seeking the advice of an attorney. Information on previous case results does not guarantee a similar future result. Hinch Newman LLP | 40 Wall St., 35thFloor, New York, NY 10005 | (212) 756-8777.
According to the complaint, the defendants convinced consumers to pay hundreds or thousands of dollars a month by falsely promising they would pay, settle or obtain dismissals of consumers’ debts and improve their credit.
The FTC alleges that victims found their debts unpaid, their accounts in default and their credit scores severely damaged.
The FTC and Florida allege that the defendants falsely claimed non-profit status to appear more credible and legitimate.
The defendants allegedly promised consumers guaranteed debt consolidation loans with favorable interest rates and low monthly payments. Once consumers agreed to the purported loan, the FTC alleges, the defendants repeatedly debited the consumers’ bank accounts.
The FTC and Florida OAG charge that the defendants failed to extend consumers the promised debt consolidation loans.
The defendants also purportedly called consumers that were already enrolled with debt relief providers claiming they were taking over the servicing of the accounts and falsely representing that they would provide the same or similar services.
The defendants are charged with violating the FTC Act, the FTC’s Telemarketing Sales Rule and the Florida Deceptive and Unfair Trade Practices Act.
Connect with the author on LinkedIn and Twitter.
ADVERTISING MATERIAL. These materials are provided for informational purposes only and are not to be considered legal advice, nor do they create a lawyer-client relationship. No person should act or rely on any information in this article without seeking the advice of an attorney. Information on previous case results does not guarantee a similar future result. Hinch Newman LLP | 40 Wall St., 35thFloor, New York, NY 10005 | (212) 756-8777.
