FTC busts internet payday loan scammers


Broadcasters can wittingly or unwittingly allow shady and/or outright false advertising onto their stations, but at least when they do it an unwitting consumer is still usually at least on step or more away from getting ripped off. But companies marketing on the internet can often worm their way right into the consumer’s bank account. Such is the case for an online payday loan scammer.

The scam is simple – the alleged perpetrators lure consumers seeking information about getting a payday loan. Of course, nobody would expect to be accepted for a loan without supplying a wealth of pertinent personal information – including such things as social security, driver license, and bank account numbers.

FTC described what happened next to consumers who went to the scammer’s website. “Near the end of the application form, the defendants offered unrelated ‘Direct Benefits’ and ‘Voice Net’ programs for food, travel and merchandise discounts, or for long distance calling and Internet access. Many consumers who clicked to ‘submit’ a payday loan application were enrolled unwittingly into the programs, which initially charged their bank accounts up to $59.90 per month, and later charged up to $99.90 per year. Consumers often did not notice the program offers, and some people who declined the offers were charged for the programs anyway, the FTC alleged.”

FTC also said what often happened after that. “As alleged in the complaint, the defendants sent consumers’ bank account information to Landmark Clearing Inc. and other payment processors to electronically generate remotely created payment orders that debited consumers’ bank accounts. Consumers typically discovered the problem when an unexpected debit appeared on their bank statement, or when their bank told them their account was overdrawn. They learned that Direct Benefits or Voice Net received the payments only after they contacted their bank or saw an online copy of the payment order. Consumers who called the defendants for a refund often got the run-around. Many consumers had to dispute the transaction or close their bank accounts to get a refund or stop the defendants from debiting their accounts.”

FTC is seeking to put Direct Benefits Group LLC out of business and is also seeking restitution for the company’s victims. Pinning the group down involves pinning down the many names under which it operates, including “Direct Benefits Online and Unified Savings; Voice Net Global LLC, also doing business as Thrifty Dial; Solid Core Solutions Inc.; WKMS Inc.; Kyle Wood; and Mark Berry.”