ATTORNEY GENERAL, DIVISION OF CONSUMER AFFAIRS COMBINE EFFORTS WITH FTC TO EXPOSE TELEMARKETING SCAMS

FROM THE OFFICE OF THE ATTORNEY GENERAL

May 22, 2008

CONTACT:
Sharon Curtis-Flair
(615) 741-5860


The Tennessee Attorney General’s Office and the Division of Consumer Affairs are helping the Federal Trade Commission and other federal, state, and local agencies to be on alert for unscrupulous telemarketers through an effort dubbed “Operation Tele-Phoney.”

With more than 180 actions filed, this year’s collaborative efforts to curtail deceptive and unfair telemarketing practices is the largest, most successful cooperative attack against telemarketing fraud to date. The FTC, the U.S. Postal Inspection Service, numerous state Attorneys General, the U.S. Department of Justice, the Competition Bureau in Canada, and other state and federal law enforcement agencies participated in this consumer protection effort.

“The telephone remains one of the favorite tools of scam artists,” Attorney General Bob Cooper said. “These individuals are adept at preying upon consumers’ fears, kindness, and hardships, often through aggressive and deceptive telemarketing tactics. It is imperative that consumers arm themselves with the knowledge needed to avoid falling victim.”

“There are things you can do to protect yourself against unscrupulous telemarketers including registering for state and federal Do Not Call registries to reduce the number of solicitations you receive and by recognizing a few basic techniques employed by many illicit telemarketers,” said Mary Clement, Director of the State of Tennessee Division of Consumer Affairs.

As part of Operation Tele-Phoney, the Tennessee Attorney General and the Tennessee Division of Consumer Affairs provided substantial assistance to the FTC in an investigation of an alleged illicit “charitable solicitation” operation based in Arizona. The companies known as Handicapped & Disabled Workshops, Inc., formerly known as Handi-Tech Company, Handi-Hope Industries, Inc., Handi-Ship, LLC and individuals Bruce D. Peeples, George Thomas, and Joshua D. Abramson solicited individuals by employing people who, according to consumer complaints, claimed they were handicapped and disabled and were selling items over the phone to make a living.

The FTC lawsuit was filed on May 13, 2008 in the United States District Court of Arizona in case #08-0908. The leadings are available on line at http://www.ftc.gov/os/caselist/0823128/index.shtm . The FTC's lawsuit alleges that the defendants targeted elderly consumers in telemarketing various household products at exorbitant prices. The defendants aggressively solicited these consumers, often calling several times a day, in an attempt to convince consumers to make a purchase.

The defendants called seeking “support” prompting many consumers to believe their purchases would help handicapped or disabled workers employed by the defendants. The FTC also alleges that the defendants mailed consumers products they did not order and debited consumers’ credit and debit card accounts for these unordered products without the consumers’ consent. The defendants also allegedly violated the DNC (Do Not Call) Registry rules by calling consumers after they asked not to be called.

It appears the companies maintained two post-office boxes in Tennessee; one in Nashville and one in Hendersonville, and directed some consumer victims to send payment to these addresses. The telemarketing scams unearthed during the FTC’s and states’ year-long investigations ran the gamut of fraudulent solicitations including various charitable solicitations, magazine subscriptions, automotive warranties, advance-fee credit cards, prescription drugs, and so-called “free” gifts and prizes with strings attached. Many of the exposed telemarketing scams specifically targeted seniors.

Locally, this target population accounts for almost 800,000 Tennesseans. For more information about Do Not Call registration and telemarketing guidelines, visit The Tennessee Do Not Call Registry http://state.tn.us/tra/ and the national Do Not Call registry http://www.donotcall.gov

If you believe you have been the victim of a telemarketing scam or any unfair or deceptive business practice or wish to report a suspicious call, contact the Division of Consumer Affairs at http://www.tennessee.gov/consumer/ or (615) 741-4737 or toll-free in Tennessee at 1-800-342-8385.