Canadian firm charged with telemarketing fraud will pay $111,000 to consumers

| 5/31/2002

Consumers allegedly defrauded by a Montreal, Canada-based telemarketer and his related businesses will receive more than $111,000 in consumer redress under the terms of a court settlement with the Federal Trade Commission announced April 29.

According to the FTC, the defendants "cold-called" tens of thousands of U.S. consumers in an attempt to sell them bogus identity theft protection services and supposed advance-fee, low-interest credit cards. The order also bars them for life from all marketing of credit-related goods or services and protection services.

The settlement was reached with Reuben Ross, individually and as an officer of R&R Consultants Inc. (R&R) and Coast to Coast Benefits Inc., also doing business as R&R, Peace and Quiet, Consumer Alert, R&R Financial, Consumer Information Services. This case was a result of the 2001 "Operation Ditch the Pitch" through which the federal-state law enforcement sweep targeted a wide range of out-bound telemarketing fraud.

According to the FTC's complaint, the defendants promised to remove consumers' personal information from the Internet, thus purportedly protecting them from identity theft. The FTC alleged the defendants told consumers their personal information, including credit card numbers, was available on the Internet and they faced unlimited liability if it was obtained by crooks. To help prevent this loss, the defendants allegedly promised to remove all consumers' personal information from the Internet and to delete consumers' names from all telemarketing lists. In addition, in a separate scheme, the defendants allegedly told consumers that for an advanced fee of several hundred dollars they would receive a low-interest credit card. In fact, the FTC alleged, consumers only received a list of banks and a booklet of tips on how to obtain a credit card. Each of these actions, the FTC said, violated Section 5 of the FTC Act and/or the Telemarketing Sales Rule.

Under the terms of the court order, the defendants are banned for life from marketing "credit-related goods or services" and "protection services." The order also requires the defendants to pay $111,354 in consumer redress.

The complaint was filed in the U.S. District Court for the Northern District of New York on April 12, and signed by the judge on April 25.