ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, June 11, 1996 TAG: 9606110045
SECTION: BUSINESS PAGE: B-7 EDITION: METRO
SOURCE: Los Angeles Times
THE MOST MASSIVE assault ever on fraudulent credit schemes is beginning across the country.
Federal and state authorities announced Monday the filing of 13 lawsuits across the United States in a crackdown on telemarketers who allegedly bilked hundreds of thousands of credit-starved consumers of fees for loans and credit cards that were never provided.
Officials described the campaign, dubbed Project Loan Shark, as the largest coordinated assault to date on fraudulent advance-fee schemes. The lawsuits against 45 individuals and companies in the United States and Canada include the first case ever filed by the Federal Trade Commission against a foreign telephone boiler room operation.
The number of victims in the 13 cases easily exceeds 200,000, with losses in the tens of millions of dollars, according to Charles Harwood, FTC regional director in Seattle. The crackdown was announced at a meeting of the National Association of Attorneys General in St. Louis.
Advance-fee schemes use the false promise of loans or credit cards to get desperate consumers to send processing fees ranging anywhere from $20 to thousands of dollars.
The operators typically lure victims by advertising a toll-free telephone number in newspapers or shoppers. Many practitioners use commercial mail drops instead of offices and target consumers hundreds or even thousands of miles away to avoid being confronted by victims.
These scams are particularly ``offensive because they often sound very credible at first and they prey upon the most defenseless,'' said New Mexico Attorney General Tom Udall, whose office filed one of the suits.
They are ``particularly enticing to consumers who are the most vulnerable - those out of work, those with poor credit ratings, or those who need money right away for emergencies,'' Udall said.
The Federal Trade Commission filed five of the lawsuits last week and 15 state attorneys general are plaintiffs in the other eight.
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