The Federal Trade Commission and Canadian authorities announced charges yesterday against a Toronto-based firm they accused of running an eight boiler-room operation that illegally marketed credit cards to consumers for a fee.
According to the FTC, 1492828 Ontario Inc., operating under several business names, offered MasterCard and Visa credit cards with credit limits of $2,000 to $2,500 in exchange for fees of $189 to $219. Advanced-fee credit card telemarketing, as the practice is known, is prohibited under the U.S. Telemarketing Sales Rule.
A federal judge in Chicago has issued a temporary restraining order against the company and frozen its assets, the FTC said. In addition, the Canadian Competition Bureau has filed criminal charges against some individuals involved with 1492828 Ontario.
The company has operated since at least September 2001 and targeted U.S. consumers, the FTC said. The FTC did not disclose an estimate on how much it believed consumers had lost.
Consumers who agreed to buy credit cards often received nothing, while some received either a stored-value card — which can be used only if the consumer deposits money into an account to pay for purchases — or packages with advertising material, according to the FTC.
