A debt collector is part of an enforcement action announced yesterday by the Federal Trade Commission, after it was accused of threatening organizations if they did not pay for merchandise they did not order.
The collection operation was just part of the enforcement action against American Future Systems, Inc., which operated under the names Progressive Business Publications and the Center for Education and Employment Law. They would call organizations and try to get individuals to sign up for “no risk” trials to publications. But the individuals were secretly subscribing to the publications, and when they did not pay, the accounts were forwarded to International Credit Recovery for collection.
The agency made false threats, such as telling individuals that their credit ratings would suffer if the debt was not repaid, or that they would be sued. The problem was that the agency did not furnish information to an credit bureau and never filed any lawsuits to recover unpaid debts.
The agency collected debts across the United States, even though it was only licensed in the state of Washington, according to the FTC’s complaint. The agency received 99% of its revenue from this one account, according to the FTC.
International Credit Recovery was the largest generator of complaints to the Better Business Bureau in its region, largely coming from individuals who were complaining about debts that were not owed to American Future Systems. But the agency never discussed the complaints with its client or conduct any investigation or due diligence into the company.
The FTC is seeking an injunction that would permanently bar the defendants from continuing to engage in the allegedly illegal conduct and monetary damages to provide refunds to defrauded customers.
