Bankruptcy

FTC Halts Robocall Credit Card Scam

By guest-writer

The Federal Trade Commission announced this week that it has shut down operations of a company charged with a scam that involved illegally making robocalls and taking consumers? money by falsely promising them lowered credit card interest rates.

The scam, according to the FTC, worked like this:

• Automated phone calls: The company, JPM Accelerated Services, reportedly set up robocalls to thousands of homes (some of which were on the National Do Not Call Registry). The calls indicated that the company was a ?card services? provider and little else.
• False promises: Telephone respondents who pressed one were apparently transferred to live telemarketers who offered to lower their credit card interest rates and thus save them thousands of dollars. The price of the service, sources note, ranged from $495 to $995, and the company apparently guaranteed a full refund to anyone not satisfied with the results.
• Failure to follow through: Of course, because this was a scam, the company did not follow through, and thousands of consumers in need of financial relief ended up losing even more money they couldn?t afford.
• Serious settlement fine announced: As part of the settlement, judgments of $5.9 million against JPM Accelerated Services and $3.2 million against related scammers have been imposed; however, the defendants at this time are unable to pay the fines, according to sources. The judgments represent the amount of money consumers were bilked out of as a result of the scams.

The Truth about Lowering Your Credit Card Interest Rates

Scams like the one recently halted by the FTC are all too common, perhaps because unscrupulous scammers know that financially strapped consumers are often willing to take even big chances to get out of debt.

But if you?re interested in lowering your credit card interest rates, the truth is that you can negotiate with your creditors yourself. Here?s how:

• Figure out where you stand financially: Look at your monthly budget and figure out what you can afford to pay toward your credit card debt each month.
• Stop charging: When you commit to paying off credit card debt, it?s important to stop putting new charges on your accounts.
• Look at your bills: Lay out your most recent bills and figure out what you owe, what your current interest rates are, and what your current monthly payments are.
• Call your credit card issuers: When you?re armed with all this information, contact your credit card companies directly, explain your situation and ask for some sort of lowered payment. It?s usually a good idea to ask for something specific, like lowered interest rates, lowered monthly payments, or a reduction of the total principal you owe.
• Reassess your situation: If your credit card issuer denies you, you may want to explore other debt-relief options, like filing for personal bankruptcy.

Full post as published by The Bankruptcy Blog on December 13, 2010 (boomark / email).