The Federal Trade Commission asked a federal court to shut down a scam that targeted financially distressed Americans by pitching a phony debt relief and credit repair program, and by falsely claiming the program was provided and funded by the federal government and endorsed by President Obama.
The FTC’s complaint targets the operators of two websites that were allegedly full of misrepresentations about the fake program, which they called the “Bill Payment Government Assistance Program.” The sites claimed that the program was governed by the Recovery Accountability and Transparency Board, a government agency formed to oversee projects funded by the American Recovery and Reinvestment Act of 2009.
Beyond claiming affiliations with and/or endorsements from the Recovery Board, the Department of Treasury, and other federal agencies, the complaint alleges that YouTube videos created by the scam’s operators included a purported personal endorsement from the President with an audio recording of him saying, “I approve this message.”
The complaint alleges that the defendants purported to offer up to $75,000 in debt relief to consumers, along with promises that consumers’ credit scores would “increase within 30 days.” Consumers contacting the scammers, according to the complaint, were told that in exchange for an advance “service charge” of $900 to $1,100, the defendants would pay off the consumers’ debts.
According to the complaint, scammers would ask consumers for details of their outstanding debt, including account numbers, and then arrange bogus electronic payments that gave consumers the impression their debts were in fact being paid. The scammers would then tell consumers to pay the “service charge,” typically through money transfer services such as Western Union or MoneyGram. Once consumers paid the charge, the scammers would then reverse the payments made to consumers’ bills, leaving consumers without the promised debt relief or improvements to their credit scores or limits.
The complaint says the organization, American Bill Pay Organization, American benefits Foundation, and others still not yet identified, made some statements consumers apparently fell for.
“Defendant(s)’ websites www.americanbillpay.org and
www.benefitsfoundation.org have made numerous statements that represent that the Program will reduce substantially consumers’ debts, including (emphasis in original):
- Bring your outstanding bills current and focus on the more important stuff in your life this coming month.
- Eliminate up to $25,000 from your debt; REGISTER NOW; The Bill Payment Government Assistance Program is funded and governed by the [Recovery Act Seal pictured] RECOVERY.GOV
- Request a pay off for your equity, student and/or auto loan. Receive the title for your vehicle within 31 days of registering with American Bill Pay
- Avoid debt and bankruptcy
- We help to eliminate outstanding bills and relieve you from the stress of overwhelming monthly bills with high interest rates
- The Bill Payment Government Assistance Progran1 awards you the opportunity to receive the deed for your home and the title for your car
- Submit your mortgage for a pay off and receive the deed for your home within 31 days or bring your rent current and relieve yourself from the burden for a few months ahead
- As of February 2013, American Bill Pay has successfully processed 9,815 registrations totaling a completed grant payout of $482,514,119.27.
- American Benefits Foundation has assisted over 2 million members and is the only foundation proven with a positive result for every member that completes the program – regardless oflocation- while delivering professional customer service and a reliable information base.
- Our members are enrolled into the Bill Payment Government Assistance Program for a govemment award of $25,000 per enrollment that is paid directly on their bills
- Members may apply for a second enrollment into the Bill Payment Government Assistance Program for an additional $25,000 Government Grant Award ”
- Imagine never paying another auto loan and how it feels to burn your mortgage files after your receive the Deed for your home and the Title for your car.
You can read the full complaint, here.
The FTC’s complaint charges the unnamed defendants with two counts of violating the FTC Act’s prohibition on deceptive acts or practices, as well as two counts of violating the Credit Repair Organizations Act’s prohibitions on collecting advance fees before providing credit repair services and making untrue or misleading representations about their services. The complaint asked the court to take steps to halt the scam immediately, as well as for a permanent order stopping the defendants’ activities and requiring them to give up their ill-gotten gains. – Source