FTC's major telemarketing fraud crackdown

The Federal Trade Commission today announced its largest telemarketing fraud sweep ever. Called “Operation Tele-PHONEY,” the crackdown includes 180 criminal and civil cases involving advance-fee loan offers, sweepstakes pitches, “free” gifts, prescription drug plans, bogus tax rebates and scams where consumers were sent households goods they never ordered.

The agency spotlighted 13 cases that together involved 500,000 victims and more than $100 million in losses.

• Med Provisions– Allegedly claim to save consumers 30-50 percent on their prescription drug costs. Some consumers also are told they will lose their Medicare benefits if they do not sign up for the package.
• Union Consumer Benefits – Allegedly sell worthless medical discount packages to elderly consumers.
• Steven Breitling/ICS Financial Firm – Consumers allegedly are offered a loan for $2,000-$5,000, but they must first pay a $75 fee.
• American Financial Card, Inc. – Allegedly defrauded thousands of consumers in the United States by promising a credit card for a $200 payment.
• Integrity Financial Enterprises – Allegedly offer to provide consumers a credit card with a $2,500-$7,500 limit. Consumers pay an uprfront pay of $200-300 but receive nothing at all or a catalog card.
• Financial Advisors & Associates – Doing business as Freedom Financial and MyUnsecuredCreditCard.com, defendants allegedly tell consumers that they will provide a major credit card, but consumers receive one that can only be used to buy from the defendants’ catalog or Web site.
• Handicapped & Disabled Workshops, Inc. – Allegedly target elderly consumers while selling various household products at exorbitant prices.
• Helping Hands of Hope – While selling household products, promise that the proceeds of the sale will either help employ the disabled or will go to a charitable cause.
• U.S. Magazine Services – Allegedly misled consumers about the monthly charges for magazine subscriptions.
• Publishers Business Services – Allegedly disguise their sales pitch as a survey, at the end of which they offer “free” or low-cost magazine subscriptions then send a hefty bill weeks later.
• NHS Systems, Inc. – Allegedly say that they are affiliated with U.S. government agencies such as the Social Security Administration, IRS, or Medicare to deceive consumers into providing bank account information. Consumers find themselves enrolled in a "discount health care program.”
• City West Advantage, Inc. dba Unified Services – Allegedly claim consumers have won a $1,000 shopping spree or other free gift, persuade them to provide bank account information then charge $149.
• Direct Connection Consulting, Inc./Suretouch LLP – Allegedly contact consumers with promises of free gift cards, gas cards or vacations, then charge their credit card.