Tampa Telemarketers Alleged to Have Falsely Promised To Save Consumers Thousands on Credit Card Debt
At the Federal Trade Commission’s request, the U.S. District Court for the Middle District of Florida has temporarily shut down Innovative Wealth Builders, Inc. (IWB), which allegedly operated a credit card interest rate reduction scam, pending resolution of the FTC’s cases against the operation. The case against IWB and its three owners is the seventh brought by the FTC in the past three months against telemarketers pitching allegedly phony debt relief services to financially distressed consumers who could least afford to lose money.
The FTC alleged in its complaint that since at least 2009, IWB cold-called consumers with credit card debt and pitched them a deceptive credit card interest rate reduction program. According to the complaint, IWB’s telemarketers claimed IWB could substantially reduce the interest rates of consumers’ credit cards, save consumers thousands of dollars, and help them pay off their debts much faster. IWB charged consumers between $500 and $2,000 with the promise that all fees would be returned to consumers if IWB failed to meet its promises.
According to the FTC, IWB did not actually obtain substantial reductions in consumers’ interest rates. It did not save consumers thousands of dollars or help them pay off their debts more quickly. Instead, the complaint alleges that IWB sent some consumers a so-called “financial plan” which included nothing more than a comparison between: 1) the total amount consumers would pay on their debts if they only paid the minimum monthly amount and 2) the total amount consumers would pay on their debts if they paid some amount greater than their monthly minimum payment. IWB allegedly refused to return consumers’ money. According to the FTC’s complaint, consumers were often further injured by subsequent unauthorized charges that IWB made to consumers’ credit card accounts.
The FTC complaint stated the sales pitch by IWB operated like this.
“Defendants typically begin their calls with an alluring pitch. Defendants tell consumers that IWB is a company that can reduce consumers’ existing credit card interest rates and save consumers thousands of dollars in a short period of time.
Defendants tell consumers that Defendants have been in business for many years and have developed close working relationships with tens of thousands of different lending institutions. Defendants say that these relationships give them superior bargaining power, allowing them to negotiate reduced credit card interest rates far better and more effectively than consumers can do for themselves. Defendants say that they have a proven record of success and that consumers can put their trust in IWB to help them reduce their credit card interest rates.
Defendants typically tell consumers that consumers will be able to payoff their debts “twice as fast” or “in half the time” without having to increase their monthly payments.
Without obtaining any detailed financial infonnation from consumers, Defendants then “guarantee” consumers a specific minimum dollar amount in savings.
The specific amount of savings guaranteed by Defendants typically ranges between $1,500 and $5,000. For example, in an telephone recording with a consumer, Defendants’ telemarketer states:
… we only have approximately 30 days to get the interest as low as possible and also show to you in black and white the guaranteed savings of 2,500 … just on this one account, ma’am, you’re going to save about $2,500 to $3,000 in interest just on this one card. Plus, it’s going to cut years off your payments. I can assure you, ma’am, we have over 15 years of experience for a reason, ma’am.
Similarly, in a telemarketing script used by Defendants, Defendants instruct their telemarketers to stress the “guaranteed” savings by saying: we will guarantee to show you a minimum savings of $3,000/$1,500 interest; we will show you a minimum savings of$3,000/$1,500 in interest; and I am sure you already know what you could do with these kinds of savings.
Once consumers are assured that they are “guaranteed” to receive thousands of dollars in savings, Defendants then tell consumers they will be charged a “one-time, lifetime fee.”
The fee quoted by Defendants typically ranges between $500 and $2,000, and the amount a given consumer is charged appears to be largely based on the consumer’s reluctance or ability to pay.
In many instances, Defendants tell consumers that there is really no “out of pocket cost” or that the fee will be “offset” or “absorbed” by the thousands of dollars in guaranteed, promised savings.
Consumers are further assured that there is “no risk” to them because Defendants guarantee consumers a full refund if Defendants fail to save consumers the minimum amount that has been promised within a very short period of time, usually within thirty days.”
The FTC’s complaint alleges that the defendants violated the FTC Act by misrepresenting their credit card interest rate reduction services, misrepresenting its refund policy, and billing consumers without their authorization. The complaint also alleges that the defendants violated the FTC’s Telmarketing Sales Rule, including by misrepresenting the debt relief service they were selling, charging a fee before providing debt relief services, and billing consumers without their express informed consent.
The complaint announced today was filed against Innovative Wealth Builders, Inc. and its owners, Carly Janene Pelland, also known as Carly Zurita; Tamara Dawn Johnson; and Sheryl Leigh Lopez.