FTC: Credit Card Scam Stole Millions
A U.S. District Court in Phoenix ordered the assets of Harvey and Tye Sloniker, who operated under a variety of corporate names including Corporate Marketing Solutions and Corporate Industries, frozen and placed in receivership at the FTC's request. The FTC said it feared the Slonikers would destroy evidence and dissipate their funds.
According to the FTC, since 1998 the Slonikers, acting on behalf of third-party clients, operated deceptive telemarketing centers, which they dubbed "contract rooms," and "employed large numbers of telemarketers trained to deceive consumers."
Agents represented that consumers were pre-approved for a major credit card if they paid an advanced fee, and they upsold credit-protection services and offered to take consumer personal data off the Internet, where they said it was vulnerable to identity thieves, the FTC said.
The FTC complaint alleges that the Slonikers and their agents were not affiliated with any financial institutions and that no consumer ever received a promised credit card. Furthermore, the FTC charged the Slonikers with obtaining consumer personal data through false pretenses, a violation of the Gramm-Leach-Bliley Act.
The relationship between the Slonikers was not specified.