FTC Settles With Brothers on Fraud ChargeTwo brothers accused of running a "massive" telemarketing fraud operation agreed yesterday to a permanent ban from telemarketing and a $525,000 judgment, the Federal Trade Commission said.
Harvey and Tye Sloniker, operating "contract rooms" staffed by telemarketing agents in Arizona, sold "nonexistent" advance-fee credit cards and bogus identity-theft and telemarketing-fraud protection services, the FTC said. Often working on behalf of third-party client companies, the Slonikers bilked consumers nationwide out of millions of dollars, the FTC charged.
The brothers engaged in numerous misrepresentations and "pretexting," the act of obtaining consumer financial information under false pretenses for the purpose of charging their credit cards or debiting their bank accounts without authorization, the FTC said. They operated under numerous business names.
The agreement with the FTC prohibits the Slonikers from misrepresenting to consumers that they already possess their credit card numbers and are simply verifying information, or that consumers must provide a bank account number in order to receive a credit card. If the brothers are found to have misrepresented their financial situation, they will be required to pay a $20 million judgment.