The Federal Trade Commission, U.S. Postal Inspection Service and the U.S. Attorney for the Southern District of Illinois halted an illegal operation that sold lists of consumers to Canadian telemarketers who planned to use them unlawfully. The lists included consumers’ credit card and bank account information, exposing thousands of consumers to possible identity theft.
Postal inspectors posing as telemarketers sought to buy lists that included account numbers and security codes. Practical Marketing, Inc., sold them just that. The Florida-based company is owned by Robert and Valerie DeSalvo. Practical Marketing pled guilty to identity theft and will pay $110,000 in fines. The FTC also brought civil charges.
Selling lists with unencrypted credit card and bank account information violates the FTC’s Telemarketing Sales Rule. The law also bars telemarketers from charging fees in advance to obtain credit cards. The FTC charged that the telemarketers violated the rule by offering advance-fee credit cards, and the list brokers knowingly assisted the telemarketers in that unlawful conduct. The list brokers are barred from collecting or selling consumers’ account numbers to unaffiliated third parties in the future, will turn over their lists to the FTC and must take steps to monitor their clients.