North Carolina Department of Justice
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NC consumers sent $1.8 million in refunds from telemarketing scam

Release date: 3/1/2010

Settlement bans payment processor that helped scammers take millions from consumers’ accounts

Raleigh: Refunds totaling $1.8 million have gone out to North Carolinians who lost money when a payment processor helped phony merchants debit their bank accounts, Attorney General Roy Cooper announced today.
 
“Businesses shouldn’t turn a blind eye to fraud so they can make money off victims,” Cooper said. “People get swindled by smooth-talking telemarketers, but this won’t work without the payment processor’s help.”
 
North Carolina, the Federal Trade Commission and six other states filed suit in December 2007 against Your Money Access, a Florida payment processor that helped phony telemarketers debit or try to debit more than $200 million from consumers’ bank accounts. Other states involved in the case include Illinois, Iowa, Nevada, North Dakota, Ohio and Vermont.
 
The FTC today announced a settlement that bans Tarzenea Dixon, CEO of Your Money Access, from payment processing and helping fraudulent telemarketers. The settlement also includes a $22 million judgment against Dixon. 
 
Many victims of the scam have already gotten their money back. Under an agreement with the Office of the Comptroller of the Currency, Wachovia Bank has issued more than $150 million in refunds to consumers whose accounts were unlawfully debited by Your Money Access, including $1.8 million sent to North Carolinians.
 
Here’s how the scam worked:  fake merchants called consumers to pretend to sell a product or service. After consumers gave their bank account information to complete the purchase, the scammers then sent it to Your Money Access, which used the information to take money from consumers’ accounts. Once the money was debited, the sellers failed to deliver the purchases or sent worthless goods the consumer hadn’t even ordered. 
 
Cooper, the FTC and the other states allege that Your Money Access played a critical role in the scam and knew it was dealing with merchants that were out to deceive consumers. The payment processor expected that many of these companies would generate high rates of returned or reversed transactions, a sign of money being debited from consumers’ accounts without their permission. In fact, 20 percent to more than 80 percent of debits processed by Your Money Access were returned, a return rate far higher than industry standards. Your Money Access closely monitored its clients’ return rates and knew about these problems.
 
To report telemarketing scams to the Attorney General’s Consumer Protection Division, call 1-877-5-NO-SCAM toll-free within the state or file a complaint online. To cut down on telemarketing calls of all kinds, Cooper urges North Carolinians to join the Do Not Call Registry by calling 1-888-382-1222 from the number they wish to register or by visiting www.donotcall.gov.  



Contact:  Noelle Talley (919) 716-6413