Court Halts Illegal Operations of Online Check Processing Firm
Qchex, an Internet-based check creation and delivery service, has agreed to a temporary restraining order to halt its unfair business practices, according to the Federal Trade Commission.
In a complaint filed by the U.S. District Court for the Southern District of California on Oct. 2, the FTC charged that San Diego-based Qchex creates and sends checks drawn on any bank account identified by a Qchex customer without verifying that the customer has authority to write checks drawn on that account.
As a result, scammers have used the Qchex service to draw checks on bank accounts that belong to others, the FTC said.
In the filing, the FTC alleged the practices violate the FTC Act and asked the court to order a permanent halt to the illegal operation. It also ordered the company to give up their ill-gotten gains.
Defendants named in this case are Neovi, Inc., doing business as Neovi Data Corp. and Qchex.com; G7 Productivity Systems Inc., doing business as Qchex.com; and their principals, James M. Danforth and Thomas Villwock.