At the request of the Federal Trade Commission (FTC), a federal court has temporarily stopped a debt relief services scheme accused of targeting seniors, including veterans, through deceptive practices. The scheme allegedly involved impersonating consumers' banks and credit card companies as well as government agencies.
The FTC filed a complaint against seven companies and three individuals operating under the "Accelerated Debt" program. This program falsely claimed to reduce consumers' debt by up to 75% or more. The complaint also seeks monetary relief for defrauded consumers.
Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, stated: “The defendants falsely posed as consumers’ banks and credit bureaus to mislead them into paying thousands of dollars for their supposed debt relief services.” He emphasized that targeting older Americans and veterans made this case particularly egregious.
According to the complaint, the Accelerated Debt defendants operated a scam that collected approximately $100 million, primarily from older consumers and veterans. One Army veteran reportedly found himself $13,000 deeper in debt due to the defendants' actions. Another consumer, a retired disabled veteran, had to use his savings and retirement funds to repay increased debt resulting from unlawful advance fees charged by the defendants.
The defendants contacted consumers through telemarketing calls or responded to inbound calls generated by direct mail and online ads. The FTC alleges several illegal activities by the defendants:
- Impersonating banks or credit card issuers, federal government agencies, or consumer reporting agencies.
- Making false promises about reducing unsecured debts.
- Collecting illegal advance fees.
- Using prohibited remotely created checks.
- Unlawfully obtaining credit reports.
- Violating Do Not Call requirements during telemarketing efforts.
Based on these actions, the FTC claims violations of several laws including the FTC Act, Telemarketing Sales Rule, Impersonation Rule, Fair Credit Reporting Act, and Section 521 of the Gramm-Leach-Bliley Act.
The Commission's vote approving the filing was unanimous at 3-0. The complaint was filed in U.S. District Court for Arizona against entities such as Accelerated Debt Settlement Inc., ADS Resolve LLC, Financial Solutions Group LLC among others. Individuals named include Jeffery A. Lakes, Robert Knechtel, and Elizabeth Reaney.
FTC staff attorneys Gregory Ashe and Benjamin Cady are handling this matter within its Bureau of Consumer Protection.
The Federal Trade Commission works towards promoting competition while protecting and educating consumers about various issues. They emphasize never demanding money or making threats for money transfers nor promising prizes. More information can be found at consumer.ftc.gov with fraud reports accepted at ReportFraud.ftc.gov.
