Tuesday, October 5, 2004
Carmel on the Case: Credit Card Controversy
Seven News has learned several Doral based businesses have shut down. The reason - they were caught working one of the oldest schemes in the book. The FTC has filed a lawsuit against the companies for misleading people in the sale of credit cards. Investigative reporter Carmel Cafiero is on the case.
(WSVN)---This advertisement is now evidence in a developing case involving credit cards that were being manufactured at warehouses and sold from phone rooms throughout the Doral area.
The Federal Trade Commission shut down the operation after convincing a federal judge there was reason to believe the law was being broken here.
Workers left so abruptly they didn't even have time to take personal items.
Lew Freeman, Receiver: "This is the mail for the last several days."
Court appointed receiver Lew freeman is now in charge. His job secure it all and try to find assets.
Lew Freeman: "But if I had to give an early report, this looks like its got all the makings of a major fraud."
The court case names call center express, individual people, an advertising company, and the pro line card.
Freeman's team of lawyer and accountants have found credit cards with many different names.
He says they all have one thing in common, after people paid - an average of $300 dollars per card - they found out they could only use it for catalog purchases.
Lew Freeman: "We believe they were promised master cards and visas."
Freeman says records seized so far show that as much as 100 thousand dollars a week was being spent to sell the cards on Spanish language television.
And from Internet sites to state agencies to local advocates - complaints are coming in daily.
Brodie White from the Better Business Bureau: "Well we're getting complaints from all over the United States."
Brodie White, President of the South Florida Better Business Bureau says so far 100 complaints are on file and he expects more.
Brodie White: "The company is advertising that you don't need a social security card, you don't need a bank account - you don't need any other credit card and this card is going to help establish your credit - it's just not true."
Elian Degan almost fell for the sales pitch. He ordered the card but then tried to cancel it once he found out he would have to pay for it before getting answers to his questions.
Elian Degan: "Wait - I'm not going to pay anything if I don't know what it is. I want to cancel it."
Elian says he was harassed and threatened until he filed a complaint with the Better Business Bureau.
Brodie White: "It's really an old scam being perpetrated on a new group of victims and it's basically the Latin and Hispanic communities that are being victimized here."
At this point, it is impossible to know just how much money is involved. But the court appointed receiver says it appears COD packages with the credit cards inside were going out at the rate of one thousand - a day.
For more information, or if you have a story for Carmel:
Call her in Dade at 305-627-CLUE
Or in Broward at 954-921-CLUE
Credit Card Call Center
800-321-4758 or 786-437-0064