At the request of the Federal Trade Commission, a U.S. district court last week temporarily shut down a telemarketing operation that allegedly targeted Hispanic consumers with deceptive offers claiming they could make money by reselling high-end products with brands such as Gucci, Armani, Coach, Bulgari, Ralph Lauren, Tommy Hilfiger and Ralph Lauren. The consumers were then charged between $400 and $490 upfront for shoddy, off-brand products. The FTC also alleged that the telemarketers threatened those who refused to pay up with arrest, lawsuits, and other repercussions.
The defendants are charged with violating the FTC Act and the agency’s Telemarketing Sales Rule (TSR). The FTC is seeking to permanently end misleading and intimidating practices by the organization, which is known by various names including Oro Marketing.
The Oro sales pitch reportedly began with unsolicited calls to Spanish-speaking consumers. The consumers were told they could resell brand-name merchandise and make a profit. According to the complaint, the telemarketers told the consumers to pay the UPS or FedEx agent delivering the merchandise with a money order. Oro instructed delivery drivers not to allow the consumer to open the package until they had received the money order.
Consumers typically found that the products were of low quality and generic or unbranded. According to the FTC, customers who complained were told the company would send another shipment with the correct items, along with a refund check for the first shipment, if they would again pay between $400 and $490 upon delivery.
If they paid for the new products, they reportedly found them to be just as shoddy as the ones they received the first time. If the consumer failed to accept and pay for the merchandise, the defendants allegedly threatened them with fines, phony lawsuits, wage garnishment, and damage to their credit history. Oro allegedly threatened some consumers with arrest or threatened to report them to immigration authorities.
Defendants named in the case are: Cream Group, also doing business as Terra Nova, TNT, Inc. and CRM, Inc.; Sami Charchian, also doing business as Oro Marketing, Inc., Modo, Modo Industry, Oro Max, Casa de Oro, Casa de Moda, Oro Mundo, and Nation/Modo, individually and as an owner or director of Cream Group, Inc.; John Charchian, a/k/a Djahangir Charchian and Jahangir John Charchian, also doing business as Oro Marketing, Inc., Modo, Modo Industry, Oro Max, Casa de Oro, Casa de Moda, Oro Mundo, and Nation/Modo, individually and as an owner or director of Cream Group, Inc.; and Norma Rae Ramos, individually and as officer and director of Cream Group, Inc.