Feb 19, 2018 | Consumer Protection, Employment & Technology Archive
FTC Mailing 72,386 Checks Totaling $2.9 Million to People Who Lost Money in Alleged Payday Loan Scheme
On February 15, 2018, the Federal Trade Commission announced that it is mailing 72,836 checks totaling more than $2.9 million to people who lost money to an alleged scheme that trapped them into payday loans they never authorized or whose terms were deceptive.
According to the FTC, CWB Services, LLC and related defendants used consumer information from online lead generators and data brokers to create fake payday loan agreements. After depositing money into people’s accounts without their permission, they withdrew recurring “finance” charges every two weeks without applying any of the payments to the supposed loan. In some instances, consumers applied for payday loans, but the defendants charged them more than they said they would. Under settlements with the FTC, the defendants are banned from the consumer lending business.
According to the FTC, the average refund amount is $40.61, and check recipients should deposit or cash checks within 60 days. Importantly, the FTC never requires people to pay money or provide account information to cash a refund check. If recipients have questions about the case, they should contact the FTC’s refund administrator, Epiq Systems, Inc., 888-521-5208.
Related News: FTC Announces Action Stopping Payday Loan Fraud Scheme
In July 2015, the FTC announced that the operators of a payday lending scheme that allegedly bilked millions of dollars from consumers by trapping them into loans they never authorized will be banned from the consumer lending business under settlements with the FTC.
The FTC identified the defendants as Coppinger and his companies, CWB Services LLC, Orion Services LLC, Sandpoint Capital LLC, Sandpoint LLC, Basseterre Capital LLC, Basseterre Capital LLC, Namakan Capital LLC, and Namakan Capital LLC, and Rowland and his companies, Anasazi ervices LLC, Anasazi Group LLC, Vandelier Group LLC, St. Armands Group LLC,; Longboat Group LLC, doing business as Cutter Group, and Oread Group LLC, d/b/a Mass Street Group.
The FTC settlement orders impose consumer redress judgments of approximately $32 million and $22 million against, respectively, Coppinger and his companies and Rowland and his companies. The judgments against Coppinger and Rowland will be suspended upon surrender of certain assets, and in each case, the full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
The settlements stem from charges the FTC filed alleging that Timothy A. Coppinger, Frampton T. Rowland III, and their companies targeted online payday loan applicants and, using information from lead generators and data brokers, deposited money into those applicants’ bank accounts without their permission. The defendants then withdrew reoccurring “finance” charges without any of the payments going to pay down the principal owed. The court subsequently halted the operation and froze the defendants’ assets pending litigation.
Under the proposed settlement orders, the defendants are banned from any aspect of the consumer lending business, including collecting payments, communicating about loans, and selling debt, as well as permanently prohibited from making material misrepresentations about any good or service and from debiting or billing consumers or making electronic fund transfers without their consent.
The orders extinguish any consumer debt the defendants are owed; bar the defendants from reporting such debts to any credit reporting agency; and prevent the defendants from selling, or otherwise benefiting, from customers’ personal information.
According to the FTC’s complaint, the defendants told consumers they had agreed to, and were obligated to pay for, the unauthorized “loans.” To support their claims, the defendants provided consumers with fake loan applications or other loan documents purportedly showing that consumers had authorized the loans. If consumers closed their bank accounts to stop the unauthorized debits, the defendants often sold the “loans” to debt buyers who then harassed consumers for payment.
The defendants also allegedly misrepresented the loans’ costs, even to consumers who wanted the loans. The loan documents misstated the loan’s finance charge, annual percentage rate, payment schedule, and total number of payments, while burying the loans’ true costs in fine print.
Source: FTC.gov
Feb 14, 2018 | Consumer Protection, Employment & Technology Archive
Federal Trade Commission announced that it is mailing 5,745 checks totaling more than $480,000 to people who lost money to a debt relief scheme that misled its customers and charged illegal upfront fees.
According to the FTC’s announcement, United Debt Counselors exaggerated how much money people would save using its services. The company’s direct mail ads looked like official documents from a bank or attorney and claimed that typical customers would have their credit card debt cut in half and become debt-free within 36 months. Under a settlement with the FTC, the defendants were banned from making misrepresentations about debt relief and other financial products or services and making unsubstantiated claims about any products or services.
The average refund amount is $84.27, and the FTC advises recipients to deposit or cash checks within 60 days. Consumers should be aware that the FTC never requires people to pay money or provide account information to cash a refund check. If refund check recipients have questions about the case, the FTC advises that they should telephonically contact the FTC’s refund administrator, Rust Consulting, Inc., 855-263-3449.
Related News: In March 2017, the FTC reported (“FTC Reaches Settlement with Nationwide Debt Relief Provider”) that United Debt Counselors LLC, a debt relief company, and its principals, allegedly, misled consumers, charged illegal advance fees, and will be banned from those practices under a settlement with the Federal Trade Commission.
The FTC’s complaint against United Debt Counselors LLC alleged that the company exaggerated how much money people would save using its services. The company’s direct mail ads, which reached up to 100,000 consumers per week, looked like official documents from a bank or attorney, and claimed that typical customers would have their credit card debt cut in half and become debt-free within 36 months.
Allegedly, the defendants repeated similar claims on their website and by phone when consumers called in response to the mail; claimed a high success rate and asserted that consumers rarely dropped out of their program; and claimed they provided consumers with a special savings account that only consumers could control. According to the FTC, however, the defendants removed monthly fees from the accounts.
Allegedly, consumers who wanted to buy the debt relief services were told they had to meet with an experienced sales representative, but instead the defendants sent notaries public, who had minimal product knowledge, to show a sales video and witness contract signings. Typically, the defendants charged advance fees before they negotiated any savings on credit card debts. It should be noted that these types of advance fees violate the FTC’s Telemarketing Sales Rule, unless consumers first meet face-to-face with a knowledgeable sales representative who can fully describe the program and answer questions.
According to the FTC, fewer than half of those who bought the services completed the program, and even fewer were debt-free at the end of 36 months.
The defendants, United Debt Counselors LLC, also known as United Debt Services LLC and also doing business as Department of Negotiations; David Melrose; Kirk Lanahan, and Corinne Maples, under a stipulated order, are banned from making misrepresentations about debt relief and other financial products or services, as well as making unsubstantiated claims about any products or services. The defendants only can charge advance fees if they comply with the Telemarketing Sales Rule; sales persons making face-to-face sales presentations must have authority to discuss material terms; they must do so in specific detail; and they must be able to answer consumer questions. The order also imposes a $9 million judgment that represents the amount of alleged harm to consumers. The judgment will be partially suspended upon payment of $510,000, and the full judgment will become due immediately, if the defendants are found to have misrepresented their financial condition.
Source: FTC.gov
Feb 13, 2018 | Consumer Protection, Employment & Technology Archive
Benco Dental Supply Company, Henry Schein, Inc. & Patterson Companies, Inc. Named in FTC Complaint Alleging Conspiracy Not to Provide Discounts to a Customer Segment
On February 12, 2018, the FTC announced that it filed a complaint against the nation’s three largest dental supply companies, Benco Dental Supply, Henry Schein, and Patterson Companies, alleging that they violated United States antitrust laws by conspiring to refuse to provide discounts to or otherwise serve buying groups representing dental practitioners. These buying groups sought lower prices for dental supplies and equipment on behalf of solo and small-group dental practices seeking to gain discounts by aggregating and leveraging the collective purchasing power and bargaining skills of the individual practices.
According to the FTC, the alleged agreement among Benco, Henry Schein, and Patterson deprived independent dentists of the benefits of participating in buying groups that purchase dental supplies from national, full-service distributors. The FTC’s complaint details communications between executives of the two companies evidencing an agreement to refuse to provide discounts or compete for the business of buying groups, as well as attempts to monitor and ensure compliance with the agreement. The FTC’s complaint also asserts that Patterson joined the agreement.
The FTC’s complaint also alleges that on multiple occasions, Benco Dental Supply invited Burkhart Dental Supply, a regional distributor and the fourth largest full-service distributor in the United States, to refuse to provide discounts to buying groups.
Based on the agreement among the distributors, the FTC’s complaint contends that Benco, Henry Schein, and Patterson unreasonably restrained price competition for dental products in the United States; distorted prices and undermined the ability of independent dentists to obtain lower prices and discounts for dental products; deprived independent dentists of the benefits of vigorous price and service competition among full-service, national dental distributors; unreasonably reduced output of dental products to dental buying groups; and eliminated or reduced the competitive bidding process for sales to these buying groups.
As full-service dental distributors, Benco, Henry Schein and Patterson offer gloves, cements, sterilization products and a range of other consumable supplies, as well as equipment, such as dental chairs and lights. Collectively, the big three control more than 85 percent of all distributor sales of dental products and services nationwide.
The United States market for dental products is valued at approximately $10 billion, and, according to the FTC, the dental practices that would have benefited from the discounts achieved by these buying groups were small businesses comprised of solo or small groups of dentists.
Source: FTC.gov
Feb 11, 2018 | Consumer Protection, Employment & Technology Archive
Advertisements Sent by Fax in Alleged Violation of the Telephone Consumer Protection Act
On January 11, 2018, a “junk fax” class action complaint was filed in United States District Court, Eastern District of Pennsylvania, against Ohio-based Dry Cast Holdings LLC, d/b/a DryCast, on behalf of all persons and entities which, allegedly, received advertisements sent via fax by DryCast in violation of the Telephone Consumer Protection Act (“TCPA”).
According to the complaint, the Plaintiff, who did not have an established business relationship with DryCast, did not expressly consent to receive any advertisement sent by facsimile from the defendant. DryCast, allegedly, sent a fax advertisement promoting its DryCast Protector. Among other things, DryCast’s fax advertisement stated that the cast protector is “affordable” and offered a “FREE Sample.” DryCast’s advertisement, which promotes the quality of DryCast’s products (“Trusted for over 25 years!”), also contained DryCast’s contact number (888-379-2278), and website address (drycast.com), but, allegedly, failed to include the required, compliant opt-out notice to prevent future fax transmissions.
DryCast, allegedly, sent fax advertisements to the Plaintiff and more than 39 other individuals in violation of the TCPA. The junk fax action seeks statutory damages of $500 for each violation of the TCPA, as well as treble, or triple, damages if it is determined that Dry Cast Holdings willfully or knowingly violated the TCPA’s fax prohibitions.
Have You Received Unsolicited or Unwanted Junk Faxes, Telemarketing Calls, Autodial Calls, Prerecorded Calls, Robocalls or Text Messages?
If you have received unwanted, unsolicited or harassing telemarketing calls, junk faxes, autodial calls, prerecorded calls, robocalls, automated calls or text messages and would like to speak privately with an attorney about your potential legal rights, please contact Michael Yarnoff, Esq., (215) 792-6676, Ext. 804, [email protected], complete the form above on the right or send an e-mail to [email protected].
Feb 11, 2018 | Consumer Protection, Employment & Technology Archive
Class Action Lawsuit Filed on Behalf of All United States-Based Credit Suisse Financial Advisers Who Had Unvested Credit Suisse Deferred Compensation Awards Pursuant to One or More Share Plans and Whose Employment with Credit Suisse Terminated Between October 20, 2015 and March 31, 2016.
On February 7, 2018, a class action lawsuit was filed against Credit Suisse Securities (USA) LLC in United States District Court, Northern District of California, as a result of Credit Suisse’s alleged refusal to pay millions owed in the form of “deferred compensation” to financial advisers who worked in Credit Suisse’s Private Banking Division following Credit Suisse’s decision to “shutter its financial advisory operations in late 2015.” Among other things, the class action lawsuit against Credit Suisse Securities (USA) LLC seeks damages and restitution.
According to the class action complaint:
The compensation that Credit Suisse agreed to pay the [financial] advisers consisted of multiple components. One of the primary components was ‘deferred compensation,’ whereby a significant portion of the [financial] advisers’ compensation for a given year is paid on a deferred basis in subsequent years pursuant to the terms of Credit Suisse’s form contracts. Under the contracts, the deferred compensation vests and is paid under a specified schedule, and is necessarily owed by Credit Suisse to the [financial] adviser except under limited, specified circumstances that are set forth in the contract—specifically, if the adviser voluntarily ‘resigns’ from Credit Suisse or the adviser is terminated by Credit Suisse for cause, neither of which occurred here.
When Credit Suisse, according to the complaint, announced in October 2015 “. . . that it was completely shuttering its financial advisory operations effective within a few months, leaving hundreds of Credit Suisse financial advisors out of a job,” the financial institution
. . . took the erroneous position that the advisors voluntarily ‘resigned’ from Credit Suisse and their remaining deferred compensation was thus forfeited under the contract. The lone exception that Credit Suisse made to this policy was if an adviser was hired by Wells Fargo, with whom Credit Suisse had entered into a ‘recruiting agreement,’ in which case they were permitted to retain some of their deferred compensation entitlements. Otherwise, all outstanding earned deferred compensation was cancelled and denied entirely by Credit Suisse. Through this ‘resignation’ façade, Credit Suisse is reported to have improperly retained as much as $300 million in deferred compensation owed to the advisers. [Emphasis added]
The class action complaint alleges that Credit Suisse “reaped the benefits of Plaintiff’s and the Class’ work over many years, including through substantial revenues Credit Suisse generated through their work.” Credit Suisse, allegedly, “should not be able to avoid its obligation to compensate the advisers fully and fairly by claiming they ‘resigned’ when, in fact, Credit Suisse simply ceased operating this business,” and the financial advisers should not “be deprived of their earned deferred compensation because of Credit Suisse’s unilateral business decision to exit the market and eliminate their jobs.”
U.S.-Based Credit Suisse Financial Advisers Whose Employment Terminated Between October 20, 2015 and March 31, 2016
If your employment as a United States-based Credit Suisse Financial Adviser was terminated between October 20, 2015 and March 31, 2016, and at the time your employment ended, you had unvested Credit Suisse deferred compensation awards, pursuant to one or more Share Plans, please contact Kehoe Law Firm, P.C., complete the form above on the right or e-mail [email protected] to discuss your potential legal rights or claims.
NOTE: The Class Excludes Credit Suisse Financial Advisers Who Were Hired by Wells Fargo Between October 20, 2015 and March 31, 2016.
Feb 10, 2018 | Consumer Protection, Employment & Technology Archive
Decatur County General Hospital Experiences Electronic Medical Record Security Incident – 24,000 Individuals May Have Been Impacted
Parsons, Tennessee-based Decatur County General Hospital, according to HealthIT Security.com, “experienced an EMR [Electronic Medical Record] security incident when unauthorized software was installed on the server the EMR vendor supports on the organization’s behalf.” Healthitsecurity.com reported that “the OCR data breach reporting tool states that 24,000 individuals may have been affected.”
The January 26, 2018 statement issued by Decatur County General Hospital reported that on November 27, 2017, the hospital
. . . received a security incident report from [its] EMR system vendor indicating that unauthorized software had been installed on the server the vendor supports on [the hospital’s] behalf. The unauthorized software was installed to generate digital currency, more commonly known as “cryptocurrency.” Following receipt of the incident report, [Decatur County General Hospital] began [its] own investigation into the incident. At this time, [the hospital’s] investigation continues, but [the hospital] believe[s] an unauthorized individual remotely accessed the server where the EMR system stores patient information to install the unauthorized software. The software was installed on the system at least as of September 22, 2017, and the EMR vendor replaced the server and operating about four days later.
Decatur County General Hospital’s statement also disclosed that the hospital does not
. . . have . . . evidence that [patient] information was actually acquired or viewed by an unauthorized individual, and based upon reports of similar incidents, [the hospital] do[es] not believe that [patient] health information was targeted by any unauthorized individual installing the software on the server. [The hospital’s] investigation to date, however, has been unable to reasonably verify that there was not unauthorized access of [patient] information. Information contained on the affected server included demographic information such as patient names, addresses, dates of birth, and Social Security numbers, clinical information such as diagnosis and treatment information, and other information such as insurance billing information. [Emphasis added]
HealthcareInfoSecurity reported that
[t]he hospital’s statement did not offer an explanation about why the EMR vendor apparently took more than two months to notify the hospital about the cryptocurrency mining discovery. And the hospital did not immediately respond to an Information Security Media Group’s request for additional information about the incident. [Emphasis added]
Decatur County General Hospital’s statement about the unauthorized software security incident can be viewed by clicking Decatur County General Hospital EMR Security Incident Announcement.
