FTC Bans Florida Co. For Aiding India IRS Scam | PYMNTS.com

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The Federal Trade Commission announced Wednesday (Feb. 15) that it has charged a Florida man with aiding telemarketers in India with scamming cash-strapped consumers in the U.S. and is now banned from helping any telemarketers as part of a settlement.

In a press release, the FTC said the proposed settlement resolves an FTC complaint against Joel S. Treuhaft and his company, PHLG Enterprises. The FTC alleges the company collected more than $1.5 million from about 3,000 consumers in a scheme that helped Indian call centers collect money from victims of IRS tax scams, government grant scams and advance-fee loan scams, among others.

“The scammers behind these call centers relied on PHLG and its runners to get consumers’ money,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection, in the news release. “Stopping companies that assist and facilitate fraud remains a top FTC priority.”

According to the FTC, telemarketers at Indian call centers tricked consumers into paying hundreds of thousands of dollars per victim for taxes they did not owe or fees for services they did not receive. The scammers would pretend they were affiliated with government agencies and would inform the victims that they owed the IRS money. Another scam was they would get a government grant after paying a fee. The consumers paid via Western Union or MoneyGram cash money transfers, making it hard for them to trace their payments or obtain refunds. The FTC alleges the defendants paid so-called “runners” to collect the money at retail stores that offer money transfer services. The FTC noted the defendants told the runners to pick up the payments ASAP so that the consumers wouldn’t have time to cancel them or stop the money transfer. The defendants are charged with violating the FTC Act and the FTC’s Telemarketing Sales Rule. The FTC imposed a $1.5 million judgment that will be suspended based on the defendants’ inability to pay. The full judgment will become due immediately if they are found to have misrepresented their financial condition.