FTC Reaches $25 million Settlement with Debt Collection Scammers

Under settlements with the Federal Trade Commission, defendants in two Tampa, Florida-area operations that allegedly bilked consumers of millions of dollars are banned from providing various types of financial services used in their schemes.  In the spring of 2012, at the request of the FTC, a court shut down the two operations.

According to the FTC, the defendants used phony debt collection calls from India and bogus claims that they would reduce consumers’ credit card interest rates to bilk consumers. Brett Fisher, a repeat offender who settled charges with the FTC in 2009 in a scam involving both advance-fee credit cards and bogus interest-rate reduction claims, masterminded both schemes, the FTC alleged.

The settlements impose a $25.3 million judgment against Fisher, and require other settling defendants to surrender available assets to satisfy their monetary judgments.  Defendants Pro Credit Group, LLC, Consumer Credit Group, LLC, and My Success Track, LLC, are not parties to these settlements, are not currently represented, and are facing default judgments.

Debt Collection Scheme: The Defendants Took More Than $5 Million Consumers Did Not Owe to Them, or Did Not Owe at All

The FTC alleged that between January 2010 and August 2011, defendants Fisher, Andre Keith Sanders, Pro Credit Group, LLC, and Sanders Legal Group, P.A. set up U.S.-based financial accounts for a call center operation based in India to unfairly collect payday loan debts from consumers who either did not owe them, or owed them to somebody else.  The operation’s callers used threats, lies, and abusive tactics to collect debts from consumers who had previously applied for or received loans from online payday loan companies and had supplied sensitive personal financial information that later found its way into the hands of those involved with the scam.

Once consumers agreed to pay, Fisher and attorney Sanders used Sanders Legal Group, P.A. to process at least $5 million from consumers whom the India-based callers had misled. Although numerous consumers complained to the local Better Business Bureau chapter about the abusive tactics of the callers, and many consumers tried unsuccessfully to get refunds, the defendants continued processing consumers’ payments.

The FTC has brought two similar cases involving allegedly phony debt collectors,  American Credit Crunchers and Broadway Global Masters, as well as a case involving an allegedly phony payday loan brokering service, Vantage Funding.

According to the FTC, from at least January 2010 until it brought its action, defendants Fisher, Sanders, Dale Robinson, William Balsamo, and five companies they controlled – Pro Credit Group, Sanders Law, Consumer Credit Group, LLC, My Success Track, LLC, and First Financial Asset Services, Inc. – deceived consumers by offering a bogus service to negotiate lower interest rates.  As part of their scheme, defendants allegedly used prerecorded telemarketing robocalls, including one from “Rachel” at “cardholder services” that urged consumers to press a number and speak to a live representative in order to obtain lower interest rates.

According to the complaint, defendants’ telemarketers falsely represented that they had established relationships with consumers’ lenders and often assured consumers that, if they did not see the promised results, they would receive full refunds.

According to the FTC, the defendants violated the Telemarketing Sales Rule by allegedly charging consumers between $695 and $995 up front for their bogus service and failing to obtain written approval from consumers before sending them robocalls.  The agency halted five similar robocall operations in November 2012.

The settlements include the following provisions:

• Impose a $25.3 million judgment on Fisher, which he agrees will not be discharged as a result of his pending bankruptcy filing.

• Ban Fisher from telemarketing, promoting financial goods and services, and debt collecting.

• Ban Sanders, Sanders Legal Group, P.A., and Sanders Law P.A. from debt collection and telemarketing – with narrow exceptions that allow him to continue practicing law.  He is required to turn over available assets to satisfy a $23.8 million judgment.

• Ban Robinson from telemarketing and debt relief services, and require him to turn over available assets to satisfy a $7.2 million judgment.

• Ban Balsamo and First Financial Asset Services, Inc. from providing debt relief services; and prohibit them from making or helping others with making robocalls, making or helping others with making outbound sales calls unless they document and record them, and helping anyone outside the United States who telemarkets to U.S. consumers.  Balsamo is required to turn over available assets to satisfy an $11.2 million judgment.