In a joint enforcement effort with state officials in Arizona, Arkansas, and Florida, the Federal Trade Commission announced actions against five robocall companies based in those states.
The defendants – Treasure Your Success, Ambrosia Web Design, A+ Financial Center, The Green Savers, Key One Solutions, and their principals – made millions of illegal prerecorded calls, the agency said, claiming to be “Rachel” and “Cardholder Services.”
The automated calls typically began with a prerecorded message that urged recipients to press 1 to speak with a representative about an opportunity to reduce credit card interest rates. Consumers were then connected to a telemarketer who pitched deceptive offers to reduce credit card debt and save them thousands of dollars in finance charges, according to the complaints. Others made specific promises that they could lower the rate to zero percent interest or save consumers at least $2,500 in finance charges. The telemarketers employed by some of the defendants claimed to be from the consumer’s credit card company.
Consumers were tricked into paying hundreds or thousands of dollars in an upfront fee – up to nearly $3,000 – but the defendants did “little, if anything” to fulfill their promises to reduce consumers’ credit card interest rates, the FTC said. Because the defendants often used a false number or a generic description like “Card Services,” consumers were unable to screen their calls using Caller ID.
The FTC alleged that the defendants violated the FTC Act by falsely marketing their services to reduce interest rates and save “thousands of dollars” on lowered rates, and violated the Telemarketing Sales Rule by making illegal robocalls and calling numbers on the Do Not Call registry.
Upon the filing of the complaints, a federal court judge halted the operations of all five defendants pending further legal action.
To read the complaints against the defendants, click here.
Why it matters: “At the FTC, Rachel from Cardholder Services is public enemy number one,” FTC Chairman Jon Leibowitz said in a statement about the cases. “We’re cracking down on illegal robocalls by bringing law enforcement actions and pursuing technical solutions to the problem.” The “technical solutions” referenced by Leibowitz will come from the public, as the agency recently launched a contest with a $50,000 cash prize for the best technical solution to block illegal commercial robocalls on landlines and mobile phones.