Consumers who racked up credit card debt unfairly in a number of states are receiving much-needed relief following a recent Federal Trade Commission announcement.
This week, The FTC sued a number of debt settlement companies operating out of Utah and Nevada after they victimized hundreds of thousands of consumers by charging their credit cards without their notification.
“This scam has caused hundreds of thousands of consumers to seek chargebacks – reversals of charges to their credit cards or debits to their banks accounts,” the government agency said in the suit, The Las Vegas Sun reports.
These charge offs then led the defendants to be placed in Visa and MasterCard’s chargeback monitoring programs, which resulted in millions of dollars in fines and the termination of many customer accounts, the prosecutors say.
The scam started in 2006 and by 2009 had evolved into an elaborate scheme that included 50 shell companies using mailing addresses for existing companies to obtain additional account information. As of yet, the defendants have not answered the allegations, The Sun says.
Since issuing new regulations for debt settlement firms, the FTC has successfully shut down a number of fraudulent operations across the country.