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Several business owners and telemarketers who were charged with violating various state and federal consumer fraud laws have been barred from engaging in debt elimination or debt negotiations as part of a settlement agreement with the Federal Trade Commission.
The FTC charged the debt elimination business owners—Kenneth Schwartz and Jennifer Whalen—and two telemarketing sales managers with offering to negotiate lower interest rates with consumers’ creditors to help reduce monthly payments and eliminate debt faster.
Consumers were charged between $399 and $629 for the services but were never informed that any savings would result from paying more than the monthly minimum—not reduced interest rates.
Specific charges against the defendants included:
The FTC imposed a $23 million judgment against the defendants but suspended it because of their inability to pay. The defendants operated the various debt elimination businesses including Debt Solutions Inc., DSI Financial Inc., DSI Direct Inc., and Pacific Consolidation.
The companies’ services were marketed on www.debt2wealth.com and www.acceleratedfinancial.com.
(Source: www.ftc.gov)
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Consumer fraud class action lawsuits are specifically designed to help individuals who have been similarly aggrieved to pursue a common goal – namely to hold the deceptive business accountable for any damages suffered. Thus, consumers who have been defrauded by a corporation or other entity may file a consumer fraud class action lawsuit on behalf of themselves and others to seek compensation for their shared grievance.
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