Court Enters Injunctive Relief in FTC and Florida Attorney General Action Against Telemarketers Who Offered Debt Relief Services

​On July 7, the Federal Trade Commission (FTC) announced that a federal court entered a preliminary injunction​ halting an alleged nationwide debt relief telemarketing scam and freezing the defendants’ assets. The FTC claims that the defendants millions from consumers.  The complaint, brought by the FTC and Florida Attorney General, alleged that the defendants contacted consumers with credit card debt through unsolicited phone calls, promising that they would negotiate better interest rates and savings directly with the credit card companies in exchange for a fee, which would be refunded if certain savings were not realized. After collecting the fee, the complaint alleges that the defendants either ignored consumers’ follow-up calls or sent them documents with “obvious advice such as that paying more than the minimum payments each month will result in the credit card debt being paid off faster.” Based on allegations that the defendants did not keep their promises to consumers, the FTC and Florida Attorney General brought claims for violation of the FTC Act, 15 U.S.C., section 45(a), the Telephone Sales Rule, 16 C.F.R., section 310, and violations of the Florida Deceptive and Unfair Trade Practices Act, Chapter 501, Part II, Florida Statutes (2014). In granting the preliminary injunction, the Court found that the plaintiffs were “likely to succeed on the merits” and therefore ordered defendants to cease representing that it had business relationships with lenders, that it could realize significant savings and interest rate reductions, and that full refunds would be provided to customers who did not see significant savings in a short time period. The Court also found that “good cause” existed to freeze defendants’ assets and to appoint a receiver over defendants “to prevent the dissipation of assets and destruction of evidence.”​