Uncle Sam, via the Federal Trade Commission, is taking a hard line on those companies that promise reductions in your credit card interest — if you cut them a big check first.
But you don’t need Uncle Sam’s help to figure out whether you’re the target of such a scam.
The hook goes like this. A federal judge in Washington, D.C., handed the FTC a major victory May 20, ruling that three credit card telemarketing firms must shut down operations.
The three companies — AMS, Washington-based Rapid Reduction and Texas-based PDMI — all specialized in bombarding consumers with robocalls offering to slash their credit card interest rates.
But according to the FTC, which filed a lawsuit against the three firms, the fix was in. Consumers put up anywhere from $499 to $1,590 in advance fees, while the companies told them that if they didn’t get at least $2,500 back in credit card rate reductions, they would earn 100% of their money back.
But consumers were delivered less than they were promised, the FTC charges. Instead of an all-out blitz on credit card firms to slash their rates, all the card services companies produced was information on how to pay a credit card off early.
Specifically, the FTC accuses the three companies of:
- deceptively promising consumers they could reduce their credit card interest rates.
- misleading consumers about their refund policies.
- illegally calling numbers on the National Do Not Call Registry.
- failing to honor consumers’ requests not to be called again.
- making pre-recorded telemarketing calls to consumers without their express written consent.