FTC Charges Florida Firm With Debt Relief Scam

Banking, finance, and taxes

Published: January 12, 2016 1:35 pm

Last Updated: January 13, 2020 3:08 pm

The U.S. Federal Trade Commission (FTC) and the State of Florida recently charged a payment processing business with credit card laundering, as well as illegally assisting and facilitating a nationwide debt relief telemarketing scheme. This is alleged to have bilked millions of dollars from consumers.

CardReady, an independent sales organization, and its executives, Brandon A. Becker, James F. Berland and Andrew S. Padnick, are the focus of these allegations. The FTC and State of Florida allege that CardReady arranged for at least 26 shell merchant accounts to be used to process credit card payments for a debt relief operation the agencies sued in June 2015.

The agencies charged the payment processor defendants, as well as E.M. Systems & Services, with credit card laundering under the Telemarketing Sales Rule (TSR) and illegal factoring of credit card transactions under Florida law. The FTC also charged CardReady and its executives with assisting and facilitating the debt relief scam.

Jessica Rich, director of the FTC’s Bureau of Consumer Protection, commented:

Our investigation went beyond the telemarketers who swindled consumers out of their money. We also stopped the credit card processing operation that hid their illegal transactions. Credit card laundering isn’t just bad business – it’s against the law.

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The FTC warns in its release:

When scammers cannot gain or maintain access to the credit card networks through legitimate means, they frequently turn to illegal credit card laundering as a way to process credit card transactions through another person or entity. This tactic allows the scammer to evade detection and charge the accounts of defrauded consumers. Credit card laundering and helping someone launder are violations of the TSR.

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