The Federal Trade Commission has levied judgments of nearly $16 million against five unrelated firms accused of bilking Hispanic consumers. The scams used a variety of direct response mediums, including television, telemarketing and the Internet.
The biggest of the five cases required Call Center Express corp. and Pro Line Card LLC, along with Edgar Alirio Gonzalez, Pablo Jose Martinez, and Carlos Felipe Mendez to pay nearly $14 million in consumer redress. The defendants used Spanish-language DRTV commercials offering major credit cards for between $149 and $299.
Consumers ordering the cards found they could only be used to purchase goods from the defendants’ catalogs or Web sites. Additionally, the defendants did not provide refunds to consumers who requested them. The judgment was handed down by the U.S. District Court for the Southern District of Florida.
The U.S. District Court for the Central District of California ordered FGH International Corp.; Inti California; FGH International S.R.L.; Johnny Rojas; and Wilson Rojas to pay $940,000 in consumer payments. The defendants called consumers, identifying themselves as being affiliated with a government program offering subsidized English-language or auto-repair training. According to the FTC, consumers were sent a package of materials C.O.D., at a cost of between $150 and $300, regardless of whether they accepted the telemarketing offer. They were then called by an associate posing as an attorney who threatened legal action unless they paid.
The order includes a $6.6 million judgment, which was suspended due to the defendant’s inability to pay more. If they are found to have lied about their financial status, they will be responsible for the full amount.
Platinum Health Plus, LLC; Fiesta Marketing, LLC; Telemedia, LLC; and their owners, Michael P. Garcia and Alexander R. Garcia were ordered to pay more than $294,000 by the U.S. District Court for the Southern District of Florida. The defendants ran ads on Spanish-language television stations that lead consumers to believe they were offering health insurance, but were actually selling access to medical providers who offered discounted services. The FTC ruled that an eight-second disclaimer – “not health insurance” was not enough to offset the implied promise of the rest of the commercial.
The FTC also said that a 30-day money-back guarantee was misleading: It applied only to members that paid for a medical provider for services within 30 days of activating their memberships.
Marketers of weight-loss products and music collections will pay $231,000 in redress stemming from deceptive claims they made in infomercials on Spanish-language television. The defendants, La Grana LLC; Losini LLC, Carlos Iniguez; and Claudia Iniguez, sold “Svelt Body Complete” and “Imagen Enlinea,” bogus weight-loss products, for $179, and CD compilations consisting primarily of poor quality covers of popular songs, for $198. The FTC suspended a judgment of $1.8 million, but reserved the right to reinstate it if the defendants are discovered to have misrepresented their assets. The decision was handed down by the U.S. District Court for the Central District of California.
Finally, Service Brokers Associates and company president Daniel Gonzales were ordered to pay $370,000 to consumers who purchased credit-repair services for fees of between $300 and $400. The sales were made via the Internet and through referrals from businesses such as car dealerships and mortgage companies. The final judgment was file in the U.S. District Court for the Southern District of Florida.
The announcements were made in conjunction with the Hispanic Law Enforcement and Outreach Forum, a Los Angeles event that brought law enforcement officials, consumer groups and Hispanic leaders together to discuss fighting fraud in the Latino community.
