CLEARWATER — The Federal Trade Commission zeroed in on Pinellas County as a hotbed for fraudulent telemarketing schemes Tuesday as it announced the largest telemarketing sweep in its history.
The federal agency filed three lawsuits in U.S. District Court in Tampa against Pinellas companies selling advance-fee credit cards targeting consumers with poor credit. The agency said the cards were misrepresented as general purpose cards, similar to a MasterCard, but in reality, they could be used only to order items from the companies' own catalogs.
In each case, the FTC says the company got consumers to reveal their bank account information, then debited their accounts for upfront fees of $200 to $300. The FTC said some of the companies also debited consumers' accounts for $30 quarterly maintenance fees without their knowledge, and some required consumers to pay 35 percent of each catalog purchase in cash in order to use their cards. Consumers found it difficult to impossible to cancel and get a refund.
The FTC filed lawsuits and obtained temporary restraining orders against:
•USA Financial LLC of Clearwater, American Financial Card Inc. of Largo (formerly Capital Financial Inc.) and principals Jeffrey Deering, Richard Guarino and John Buschel Jr. The company is still operating and says the three men no longer work there.
•Integrity Financial Enterprises LLC of Clearwater, which also did business as Infinite Financial and National Benefit Exchange; National Benefit Exchange Inc. of Indian Rocks Beach and officer Robert James Fischbach. The company could not be reached.
•Financial Advisors and Associates Inc. of Largo, which also operated as Freedom Financial and MyUnsecuredCreditCard.com, and company president James Sweet. The company could not be reached.
The three lawsuits were among 13 FTC actions and more than 180 total cases across the country announced Tuesday as part of "Operation Tele-PHONEY." The agency said the actions in the United States and Canada involve more than $100-million in fraud.
FTC regional director Brad Elbein said the American Financial Card scheme alone defrauded consumers out of as much as $15-million and the two other Pinellas cases involved similar large sums.
Why would Pinellas County attract so many schemers?
"The answer could be as simple as this is a beautiful place to live," Elbein said.
Although the telemarketers operated in the area, officials said there were no local victims identified.
"They don't hunt where they live," said Elbein, explaining that they target out-of-state consumers.
Half of the 180 cases the FTC cited were in Florida, brought by Florida Attorney General Bill McCollum, Florida Agriculture and Consumer Services Commissioner Charles Bronson and local law enforcement. The cases include a dozen arrests for illegal telemarketing announced last month, including seven people in Pinellas County.
"This was just the tip of the iceberg," said Victoria Butler, chief of the attorney general's economic crimes division.
Other agencies involved in the effort include the Pinellas County Department of Justice and Consumer Services, the Clearwater Police Department and the U.S. Postal Inspection Service.
Helen Huntley can be reached at firstname.lastname@example.org or (727) 893-8230.