The Federal Trade Commission and the State of Florida have charged CardReady, a payment processing business with credit card laundering and illegally assisting and facilitating a nationwide debt relief telemarketing scheme that allegedly bilked millions of dollars from consumers.
When scammers cannot gain or maintain access to the credit card networks through legitimate means, they frequently turn to illegal credit card laundering as a way to process credit card transactions through another person or entity. This tactic allows the scammer to evade detection and charge the accounts of defrauded consumers. Credit card laundering and helping someone launder are violations of the Telemarketing Sales Rule (TSR).
In an amended complaint filed in federal court, the FTC and the State of Florida alleged that CardReady LLC, an independent sales organization, and its executives, Brandon A. Becker, James F. Berland and Andrew S. Padnick, arranged for at least 26 shell merchant accounts to be used to process credit card payments for a debt relief operation the agencies sued in June, 2015.
The agencies charged the payment processor defendants, as well as E.M. Systems & Services LLC, with credit card laundering under the TSR and illegal factoring of credit card transactions under Florida law. The FTC also charged CardReady and its executives with assisting and facilitating the debt relief scam.
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