Task Force Targets Canadian Tele-sharks
In a continuing effort to battle telemarketing fraud in New York State, Attorney General Spitzer today announced a court order freezing the assets of a Canadian company accused of operating a massive "advance fee" loan scam.
"Telemarketing fraud is a growing problem throughout the nation, but especially in the North Country" Spitzer said. "My office has established a Telemarketing Fraud Task Force that will use all means available to stop scam artists from further victimizing our citizens."
Montreal, Quebec-based National Credit Search, Inc., (NCS) is accused of targeting consumers in New York with poor credit histories with false promises of credit cards with high limits and no credit check.
The company, which also does business as Financial Marketing Group, Select Credit, and Wise Select Credit, is accused of violating federal and state consumer protection laws. Specifically, the company and its officers Howard Diamond and Lorne Eisenstat of Quebec, are alleged to have used telemarketing calls and unsolicited mail to convince consumers to pay an advance fee of between $39 and $79 for unsecured credit cards that were supposed to arrive in 14 days.
None of the consumers who responded, however, received the promised credit card. Many consumers received nothing at all, while others received a list of banks and finance companies that NCS claimed would issue them credit. When consumers applied to any of the listed banks, they were told by the financial institutions that there was no affiliation with NCS and that they didn't issue unsecured credit to individuals with poor credit histories.
Some other consumers received "registration materials" - and another bill for an additional $50 - $70 - to receive a catalog from which the individual could purchase items using a credit line good only for purchases from that catalog. Many who chose to pay the additional fee received nothing, and those who actually received the catalog quickly learned that the items were of little value to them, that shipping fees were quite significant - and most importantly - that NCS was never going to uphold its promise for an unsecured credit card.
Spitzer's office, which filed suit in Albany County State Supreme Court, has requested full refunds for consumers, civil penalties for NCS's violations of consumer protection laws, a permanent injunction barring it from further consumer deception and abuses, and an order barring NCS from credit referral, loan brokering and direct marketing in New York State unless it posts a $500,000 performance bond.
NCS represented its business location as Delmar in Albany County, but merely rented a post office box in that community.
Judge Joseph C. Teresi of Albany County State Supreme Court signed the temporary restraining order freezing nearly $150,000 in NCS's assets in a Plattsburgh bank account where the company stored its ill-gotten proceeds from its illegal advance fee loan scam.
It is estimated that thousands of consumers across the nation have been duped by NCS's scam.
This case is being handled by Assistant Attorney General Mark Fleischer of the Consumer Frauds and Protection Bureau with the assistance of the New York Attorney General's Task Force on Telemarketing Fraud.
Individuals with questions regarding National Credit Search or any advance fee loan offer are encouraged to contact the Attorney General's consumer help line at (800) 771-7755.