Judge Freezes Assets of Pharmacycards
A U.S. District Court judge in Nevada froze the company's operations May 25. According to the FTC, Pharmacycards.com tried to debit more than $10 million from consumers over a three-month period, eventually removing $139 each from the bank accounts of 90,000 consumers for a "discount pharmacy card" program.
A Web site and toll-free number, answered by a call center in Montreal, persuaded payment processors to participate in the program, the FTC said. The company used the logos of legitimate retailers, including Wal-Mart and Target, and claimed to be participating in the "discount prescription benefits program," though it was not, according to the complaint.
Some consumers received a letter from Pharmacycards -- after their accounts were debited -- describing the program and stating they had five days to cancel, the complaint alleged. One payment processor debited 72,240 transactions, of which more than 50,000 were canceled. But many consumers were unaware their accounts had been debited, or simply discarded the letter unread, the FTC said.
According to the FTC, two shell companies operated Pharmacycards: 3rd Union Card Services, Lewes, DE, and HelmCrest, based in Nicosia, Cyprus. The FTC also named David Graham Turner of London and Steve Pearson, whose residence was not disclosed, as directors of the companies.
Funds were deposited into HelmCrest's bank account in Cyprus, according to the complaint.
The FTC did not disclose the source from which Pharmacycards obtained consumers' billing data. A message left yesterday at a phone number listed for Pharmacycards under Internet registration records was not returned.