Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Scammers targeting seniors banned from telemarketing, (Mar 12, 2015)
Organizations Mentioned:1166519075 Quebec Inc. | Bureau of Consumer Protection | First Consumers LLC | PowerPlay Industries LLC | Standard American Marketing, Inc. | and 1164047236 Quebec, Inc.
By Jody Coultas, J.D.
The federal district court in Philadelphia permanently barred the ringleader of a multi-million dollar fraud that targeted seniors from all telemarketing activities after ruling that the defendants violated the FTC Act and the Telemarketing Sales Rule (FTC v. First Consumers, LLC, February 19, 2015, McHugh, G.). The summary judgment entered against Ari Tietolman and the related default judgment entered against associated U.S. and Canadian corporate entities imposed a judgment of $10.7 million.
Tietolman and his associates established a network of U.S. and Canadian entities, and used a telemarketing boiler room in Canada to cold-call seniors claiming to sell fraud protection, legal protection, and pharmaceutical benefit services. The FTC alleged that Tietolman illegally withdrew money from U.S. consumers’ accounts and funneled it across the border to Canada.
“Callers working for Ari Tietolman lied to older people and took their money without permission,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “Their actions were abhorrent. We’re gratified that the court banned Mr. Tietolman from any future telemarketing and awarded over $10 million.”
The court held that Tietolman’s telemarketers deceived consumers to obtain their bank account information, then used consumers’ bank information to create checks drawn on the consumers’ bank accounts. The telemarketers even convinced consumers they were affiliated with banks or government entities. They deposited these “remotely created checks” into corporate accounts set up by defendants in the United States, thus debiting consumers’ accounts without permission. The U.S.-based defendants then transferred the money to accounts in Canada.
Tietolman and the corporate defendants were also barred from all telemarketing activities, using remotely created checks and payment orders, from charging consumers without their express informed consent, and from making misrepresentation during the sale of any goods or services.
Companies: First Consumers LLC; PowerPlay Industries LLC; Standard American Marketing, Inc.; 1166519075 Quebec Inc.; and 1164047236 Quebec, Inc.
News: ConsumerProtection FederalTradeCommissionNews