Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Medical discount scammers banned from selling healthcare-related products, (Nov 13, 2015)

By Michael Menzhuber, J.D., LL.M.

Under a settlement with the FTC, a mother-son marketing team, who allegedly tricked Spanish-speaking and other consumers into buying phony medical discount cards, will be banned from selling any healthcare-related products, the agency announced today. The proposed settlement order also permanently prohibits Constanza Gomez Vargas, Walter S. Vargas, and United Solutions Group Inc. from misrepresenting material facts about any product or service, and selling or otherwise benefitting from customers’ personal information.

In August 2014, the defendants were charged by the FTC with falsely telling consumers they were buying a qualified health insurance plan under the Affordable Care Act. According to the FTC’s complaint, the defendants: (1) targeted consumers who needed health insurance or were paying high premiums for coverage because they had lost their jobs or had pre-existing medical conditions; (2) claimed the “insurance” would pay for doctor and emergency room visits; and (3) issued consumers nearly worthless “discount cards”. As a result, consumers were left uninsured, despite paying an enrollment fee and monthly payments ranging from $99 to several hundred dollars.

The proposed settlement order also imposes a $2.1 million judgment that will be suspended upon payment of $17,616 and the transfer of two vehicles. Litigation continues against Gary L. Kieper and Partners In Health Care Association Inc.

The U.S. District Court for the Southern District of Florida entered the order on November 10.

Companies: United Solutions Group Inc.

News: ConsumerProtection FederalTradeCommissionNews