Markets Wired

The operators of a Philadelphia-based telemarketing scheme will pay more than $7.5 million to settle Federal Trade Commission charges that they peddled bogus “platinum” credit cards and illegally debited consumers’ bank accounts.  Under a settlement with the FTC, Blake Rubin, Chase Rubin, and Justin Diaczuk — the individuals allegedly behind the Platinum Trust Card and Express Platinum Card scam — will be permanently banned from telemarketing, and from selling any type of credit card product or service.

As part of the FTC’s ongoing crackdown on schemes that prey on financially strapped consumers, in January 2012 the agency charged the defendants with violating the FTC Act and the FTC’s Telemarketing Sales Rule.  A federal court subsequently halted the operation, froze the defendants’ assets, and appointed a receiver to control the business pending resolution of the case.

According to the FTC, the defendants allegedly called online payday loan applicants and offered a purported general-purpose credit card with a credit limit of up to $9,500, in exchange for an advance fee of up to $99 and a monthly $19 fee.  They allegedly falsely claimed their cards could be used anywhere that accepts Visa, MasterCard, or American Express, and that the cards would help rebuild consumers’ credit ratings because the defendants reported payment history to the major credit bureaus.  The FTC alleged that the “credit cards” could be used only to purchase off-brand, overpriced products at the defendants’ online store.

In addition to imposing the monetary judgment and banning Blake Rubin, Chase Rubin, Justin Diaczuk, Apogee One Enterprises LLC, and Marquee Marketing LLC from telemarketing and credit card marketing, the settlement order permanently prohibits them from misrepresenting material facts about any goods or services, collecting payments from their customers, disclosing or otherwise benefitting from customers’ personal information, and failing to dispose of this information properly.

To learn more about telemarketing scams, read Who’s Calling? Recognize and Report Phone Fraud.

The Commission vote to authorize staff to file the consent order for permanent injunction was 5-0.  The consent order was entered by the U.S. District Court for the Northern District of Illinois, Eastern Division on September 19, 2012.

Note: This stipulated final order is for settlement purposes only and does not constitute an admission by the defendant of a law violation.  A stipulated final order requires approval by the court and has the force of law when signed by the judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics.  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.