The Federal Trade Commission (FTC) has filed suit in the U.S. District Court for the Northern District of Illinois against several U.S and Canadian based companies, alleging that these companies implemented a medical discount scam that targeted seniors across the country. According to the FTC’s complaint, seniors in the U.S. were victims of deceptive calls by telemarketers whereby they would offer phony discounts on prescription drugs and even pretend to be affiliated with Social Security, Medicare, or medical insurance providers.
As indicated in the FTC’s recent press release, the telemarketing calls pitched a prescription drug discount card that would supposedly provide substantially discounted or even free prescription drugs to seniors. Many victims were led to believe they had to purchase the card to continue receiving their Social Security, Medicare, or other medical insurance, which was not the case.
Additionally, the discount cards that these companies were selling were actually available for free by calling a toll-free number or visiting a website. Moreover, the discount cards generally do not provide any discounts to consumers who already have either governmental or private insurance. However, the FTC alleges that the telemarketers deceitfully convinced their victims to turn over their bank account numbers in order to purchase a discount card, and then used that information to debit money from the victims’ accounts.
The companies used the victims’ bank account information to take approximately $300 from their bank accounts using a “demand draft.” Moreover, not all consumers who paid for the purported discount card even received it – some victims received nothing at all for their money.
The FTC is actively working to shut down the medical discount scheme. Some of the companies responsible for the scheme include, but are not limited to, AFD Advisors, LLC; AMG Associates, LLC; CAL Consulting, LLC; Park 295 Corp., as well as Canadian companies 9262-2182 Quebec Inc. and 9210-7838 Quebec Inc. The companies, and certain officers of these companies, have been charged with violating Section 5 of the FTC Act by deceptively presenting themselves as government or insurance representatives, as well as by telling consumers that the discount plans they were selling could provide substantial discounts on prescription drugs.
Additionally, the companies, and certain officers of these companies, have been charged with violating the FTC’s Telemarketing Sales Rule for their deceptive acts and for calling consumers whose numbers were on the National Do Not Call Registry. A federal judge in the U.S. District Court for the Northern District of Illinois issued a temporary restraining order halting the companies’ deceptive scheme and freezing their assets. The Director of the FTC’s Bureau of Consumer Protection, Jessica Rich, stated:
This scam, which targeted and deceived our nation’s seniors, is as cynical and wanton as they come. We look forward to bringing this operation to a halt and working to get relief for the victims.
If any of our readers are aware of this type of fraud or deceit and need assistance, they can contact Ali Hawthorne, a lawyer in our firm’s Consumer Fraud Section, at 800-898-2034 or by email at Alison.Hawthorne@beasleyallen.com.
Source: Federal Trade Commission
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