Debt Relief Scams Shut Down by FTC
Advanced Management Services NW LLC and Dynamic Financial Group were accused by the FTC of making misleading telemarketing calls, contacting consumers on the Do Not Call Registry and placing illegal robocalls.
Settlements with the defendants ban all of them from selling debt relief services, and several of them were also forced to surrender to the FTC or sell off a number of assets, including a boat, luxury cars, jet skis, ATVs and two condominiums.Advanced Management Services
Advanced Management Services, PDM International Inc. and several co-defendants based in Texas and Washington were accused by the FTC of calling consumers and claiming they could dramatically negotiate interest rates with the consumers' credit card issuers.
The defendants used prerecorded robocalls urging consumers to "press one" to speak with a representative, deceiving many victims into thinking it was their credit card company. The fraudsters charged consumers up to $1,590, which they promised to refund if they failed to obtain at least $2,500 in interest rate savings.
But instead of negotiating lower interest rates, the scammers merely sent consumers instructions to pay off their credit card debts early to save money on interest. Consumers who demanded refunds were either denied, given the run-around or penalized with a $199 "nonrefundable fee" deducted from their refund.
The settlement with Advanced Management Services, Ryan David Bishop and Michael L. Rohlf, bans the defendants from selling debt relief services, misrepresenting goods or services, collecting payments from their customers and selling, using or improperly disposing of customers' personal information. The defendants were also fined $8.1 million.
The settlement with PDM International Inc. and William D. Fithian also bans them from telemarketing and violating the FTC's Telemarketing Sales Rule. They were also fined $13.8 million.
Both fines, which represent the amount of money lost by consumers, will be suspended when the defendants surrender most of their assets, including several luxury cars, a boat, jet skis and ATVs. If the defendants are found to have lied about their finances, the full penalties will be due immediately.
The FTC charged Dynamic Financial Group and other defendants of convincing consumers they could save them thousands of dollars by reducing their credit card interest rates and helping them pay off their debts faster -- for an up-front fee of as much as $1,995.
The defendants also promised consumers a full refund if they didn't save them a "guaranteed" amount -- typically $2,500 or more. But the defendants failed to negotiate lower interest rates for consumers or provide refunds to their victims.
Under five settlement orders in this case, all the defendants, who are based in Canada, Florida, and New Jersey, are banned from selling debt relief services, misrepresenting goods or services, collecting payments from their customers, and selling, using or improperly disposing of customers' personal information.
The order against 2145183 Ontario Inc., Joseph G. Rogister and Christopher M. Hayden prohibits them from robocalling and includes a fine of $8.3 million, which was suspended due to their inability to pay.
The order against Thriller Marketing LLC, Dwayne J. Martins and John L. Franks Jr. includes a $4.9 million penalty that will be suspended when Martins surrenders the proceeds from the sale of his 2005 BMW 645 and Franks has surrendered the proceeds from the sale of two Tampa, Fla., condominiums.
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 instance, the full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
The orders against Michael Falcone and Sean Rogister includes fines of $93,137 and $90,473, respectively, which are due immediately. Alpha Financial Debt Group Inc. was fined $8.68 million, and litigation continues against the remaining defendant, Philip N. Constantinidis.
In order to avoid getting taken in by scammers, the FTC offers consumers Information on credit repair and repairing your own credit.