Credit Card Debt Reduction Firms Face Asset Seizures

Three credit card debt reduction companies have even more to fear in the wake of a Washington judge's latest ruling. U.S. District Judge Lonny Suko froze the assets of three telemarketing companies under investigation by the Federal Trade Commission. Already targeted by an FTC lawsuit and numerous complaints, the three companies allegedly used robo-dialers to pitch tens of thousands of consumers. Recorded announcements promised consumers full refunds of fees as high as $2,000 if they did not see substantial reductions in their interest rates.

FCC rules already prohibit auto-dialing cell phones, and FTC guidelines require a consumer's explicit permission before a marketer can use robo-dialers for outreach campaigns. In statements to reporters, FTC officials charged the firms with other violations, including:

  • deceptively promising that they could reduce consumers' credit card rates,
  • contacting callers listed on the FTC's Do Not Call Registry,
  • failing to honor consumers' refund requests, and
  • failing to remove consumers from their calling lists upon request.

Judge Suko named two receivers to take control of the three businesses after the FTC cited evidence collected by Better Business Bureau offices in four states.

About the Author

joe

Joe Taylor Jr. is an internal business consultant for a Fortune 500 company, who writes about finance, culture, and design. He holds a Bachelor of Science in Communications from Ithaca College.