FTC Halts Cross Border Domain Name Registration Scam

I was glad to see this press release from the FTC, because as the Co-Founder of a non-profit I have seen the letters that companies like this send out, and how real some of them look, so I can see how some people would believe that they must really pay the fees that these people are asking for.

Read the press release to understand what I am talking about . . .

Thousands of Small Businesses and Non-profits Billed for Bogus Renewal Fees

The Federal Trade Commission has permanently halted the operations of Canadian con artists who allegedly posed as domain name registrars and convinced thousands of U.S. consumers, small businesses and non-profit organizations to pay bogus bills by leading them to believe they would lose their Web site addresses unless they paid. Settlement and default judgment orders signed by the court will bar the deceptive practices in the future.

In June 2008, the FTC charged Toronto-based Internet Listing Service with sending fake invoices to small businesses and others, listing the existing domain name of the consumer’s Web site or a slight variation on the domain name, such as substituting “.org” for “.com.” The invoices appeared to come from the businesses’ existing domain name registrar and instructed them to pay for an annual “WEBSITE ADDRESS LISTING.” The invoices also claimed to include a search engine optimization service. Most consumers who received the “invoices” were led to believe that they had to pay them to maintain their registrations of domain names. Other consumers were induced to pay based on Internet Listing Service’s claims that its “Search Optimization” service would “direct mass traffic” to their sites and that their “proven search engine listing service” would result in “a substantial increase in traffic.”

The FTC’s complaint charged that most consumers who paid the defendants’ invoices did not receive any domain name registration services and that the “search optimization” service did not result in increased traffic to the consumers’ Web sites.

A federal district court judge in Chicago, Robert M. Dow, Jr., ordered a temporary halt to the deceptive claims and froze the defendants’ assets, pending trial. The settlement and default judgment orders announced today end that litigation.

The orders bar the defendants from misrepresenting: that they have a preexisting business relationship with consumers; that consumers owe them money; that they will provide domain name registration; and that they will provide “search optimization services” that will substantially increase traffic to consumers’ Web sites. The defendants are also required to disclose any material restrictions or aspects of any goods or services they provide.

The settlement order, entered against defendants Isaac Benlolo, Kirk Mulveney, Pearl Keslassy, and 1646153 Ontario Inc., includes a suspended judgment of $4,261,876, the total amount of consumer injury caused by the illegal activities. Based on the inability of the settling defendants to pay, they will turn over $10,000 to satisfy the judgment. The default judgment order was entered against defendant Steven E. Dale and includes a judgment in the amount of $4,261,876.

Charges against Ari Balabanian and Data Business Solutions were dismissed by the court at the FTC’s request.

NOTE: Stipulated orders are for settlement purposes only and do not necessarily constitute an admission by the defendants of a law violation. Stipulated orders have the full force of law when signed by the judge.
The Federal Trade Commission works for the consumer to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, click http://www.ftccomplaintassistant.gov or call 1-877-382-4357. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad. For free information on a variety of consumer topics, click http://www.ftc.gov/bcp/consumer.shtm.

Bank of America Settlement

I found a great article on the Bank of America Settlement with the FTC.

In my last post I noted the beginnings of some positive movement by consumer protection agencies that have been largely dormant and, in some cases like the United States Trustee program, actively anti-consumer. A few weeks ago, as Katie Porter noted in a recent post, Bank of America (BOA) reached a settlement with the Federal Trade Commission with respect to certain mortgage overcharges, including overcharges in bankruptcy, on mortgages formerly serviced by Countrywide Mortgage. The settlement requires reimbursement to consumers who were overcharged. BOA, in addition to agreeing not to lie, steal, or file documents without reviewing them, will also have to follow notice procedures similar to those that are already required or are likely to be required for all mortgage companies once new Bankruptcy Rule 3002.1 becomes effective in December, 2011. The United States Trustee (UST) Program assisted the FTC in its efforts. This settlement is the first significant positive result of increased UST scrutiny of mortgage lenders, although the extent of the UST’s participation is not known.

To read the rest of the article go to http://www.creditslips.org/creditslips/2010/07/bank-of-america-settlement-with-ftc-raises-some-questions.html#more

Good news for some homeowners

In a press release from the FTC it was announced that Countrywide, who was accquired by Bank of America in 2008, will be paying $108 million to homeowners who were struggeling to keep their homes and Countrywide collected exsessive fees from.

“Life is hard enough for homeowners who are having trouble paying their mortgage. To have a major loan servicer like Countrywide piling on illegal and excessive fees is indefensible,” said FTC Chairman Jon Leibowitz. “We’re very pleased that homeowners will be reimbursed as a result of our settlement.”

The bank took advantage of the fact that these people were in an emotional place while they were making these choice because they feared that they could loose their home.  They trusted what the bank employees were telling them, and as my husband and I learned years ago, you cannot always trust that the information that they are giving you is true and accurate, even when you think you are asking the right questions.

To read all of the information on this case and the settlement with the FTC, you can go to
http://ftc.gov/opa/2010/06/countrywide.shtm

News from the FTC

The FTC has some great information on efforts that they have taken against scams and fraud.  A recent press release talks about a New Jersey based telemarketing scheme and Civic Development Group.  To read the entire press release, go to http://www.ftc.gov/opa/2010/03/cdg.shtm

Dear FTC: Please go after the real predators. – Denise Richardson

My friend Denise Richardson of Give Me Back My Credit wrote an article about the FTC regulating the way identity theft prevention is advertised, and the press conference yesterday that involved LifeLock . . . whom Denise is a long time LifeLock supporter.

To read the article, go to Dear FTC: Please go after the real predators. – Denise Richardson

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Looking for work?

BOTTOM DOLLAR. The FTC continues its crackdown on con artists who prey on unemployed Americans by promising to help them get jobs in the federal government, as movie extras, or as mystery shoppers; or make money working from their homes stuffing envelopes or assembling crafts and ornaments. David Vladeck, Director of the FTC’s Bureau of Consumer Protection, Tony West, Assistant Attorney General for the Civil Division of the Department of Justice, and Ohio Attorney General Richard Cordray announced the law enforcement sweep “Operation Bottom Dollar,” against these scams. The sweep includes seven FTC cases, 43 criminal actions by the Department of Justice, a civil action by the Postal Inspection Service and 18 actions by state attorneys general. The FTC also partnered with Monster.com, the search engine Bing, and Craigslist to post FTC tips that help job seekers recognize and avoid job scams. Read the press release.

FTC and Ticketmaster

BAIT-AND-SWITCH. The FTC has settled charges that Ticketmaster and its affiliates used deceptive bait-and-switch tactics to sell event tickets to concertgoers. Ticketmaster has agreed to pay refunds to people who bought tickets for 14 Bruce Springsteen concerts in 2009 through TicketNow, its ticket resale site, and to be clear about the costs and risks of buying through its reseller sites.  The FTC charged that Ticketmaster steered consumers to TicketsNow, where tickets were offered at much higher prices – in some cases quadruple the face value. According to the FTC, Ticketmaster also didn’t tell buyers that many of the resale tickets advertised on TicketsNow.com were not actual tickets secured for sale at the time they were listed and bought. Ticketmaster kept the sales proceeds for more than three months without a reasonable basis for believing it could fulfill the orders. Read the press release.