FTC & Florida sue alleged phony debt relief company

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The state of Florida and Federal Trade Commission have teamed up in a lawsuit against an alleged phony debt relief company that robocalled consumers.

According to the FTC, Life Management Services tricked people out of their money by offering two types of  bogus debt relief services, credit card interest rate reduction services and credit card debt elimination services. The business promised lower interest rates or government funds to pay off debt, and asked people to make initial payments  from $500 to $20,000.

However,  almost no one got the help that was promised.

In reality, the company sometimes made a basic attempt to contact the consumer’s credit card company. But consumers report that  were almost never able to obtain the promised rates or savings, the agencies said. As far the government funds, no such thing existed. The federal agency said consumers who paid  the up-front fee wound up deeper in debt with damaged credit scores and higher interest rates and late fees.

The complaint from the FTC said the scheme defrauded consumers out of more than $15.6 million since at least January 2013.

“Working jointly with the FTC, our actions to stop these schemes and hold the scammers responsible will not only keep Floridians from falling victim to these scams, but also protect consumers nationwide.” said Florida Attorney General Pam Bondi.

A federal district court in Orlando has temporarily stopped the operation from making illegal robocalls and selling its services pending an upcoming hearing.

 

 

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