The Consumer Financial Protection Bureau nailed of the nation’s two largest debt buyers and collectors for using deceptive tactics to collect bad debts. The Bureau found that Encore Capital Group and Portfolio Recovery Associates (PRA) bought debts that were potentially inaccurate, lacking documentation, or unenforceable.
New research reveals a false-positive decline may be a bigger threat than transaction fraud and can seriously erode customer loyalty and pushes many consumers to abandon the issuer or merchant connected with the erroneous decline.
Chicago-based Lyons Consulting Group (LYONSCG) has become a systems integration partner of Riskified, a venture-backed eCommerce fraud prevention solution provider. Riskified enables online merchants to accept credit card transactions they would otherwise decline, as it covers all approved orders with a 100% chargeback guarantee in case of fraud.
At the Federal Trade Commission’s request, federal courts in New York and Georgia have temporarily halted three debt collection operations that allegedly violated federal law by threatening and deceiving consumers via text messages, emails, and phone calls. The FTC seeks to permanently end the unlawful practices.
Heartland Payment filed a federal lawsuit against Mercury Payment Systems for false advertising, unfair competition, intentional interference with contractual relations, and intentional interference with prospective economic advantage. The suit alleges that Mercury is illegally competing against Heartland with deceptive trade practices and that Mercury is effectively misleading merchant customers by deceptively hiding its excess profits in the interchange fees charged by credit card networks and their issuing banks, in violation of the Lanham Act.
The suit seeks to stop Mercury’s routine deceptive pricing practices to secure new retail customers and maintain their existing merchants. The suit also seeks to recover full value for each merchant and prospect Mercury has wrongfully taken from Heartland by deceptively falsifying pass-through interchange costs and other illegal methods. Heartland explains that the fees charged by credit and debit card issuers – the issuing banks plus card brands such as Visa and MasterCard – are collectively known as network, or interchange, fees. Interchange fees are set by the card brands, and are typically adjusted twice a year. The complaint also alleges that Mercury imposes significant costs and barriers for changing providers, falsely informs merchants that they are the only processor that supports their point-of-sale card swiping equipment, and falsely represents their company in commercial advertising and promotions as guaranteeing the best rate, among other charges.
USA Technologies, a leader of wireless, cashless payment and M2M telemetry solutions for self-serve, small-ticket retailing industries, sent a letter to shareholders providing additional insight on dissident shareholder Bradley Tirpak, as well as the destruction of shareholder value at Direct Insite Corp., after a group of shareholders, including Tirpak, took control of the board. The…
Experian research now shows frauds attempted against financial services providers increased 11% in 2010 while 20 in every 10,000 applications for credit and other financial products made last year were discovered to be fraudulent, up from 18 in 2009. The year also saw a 25% uptick in in fraudulent applications for current accounts while 7 in every 10,000 loan applications were flagged as fraudulent in 2010, up from five in 2009. Identity fraudsters were responsible for 60% of these cases. The most dangerous place for a consumer’s identity; London, England.
Ethoca360 “Signals” ideally suited as a partner solution, evaluates order transaction data elements and finds links, matches and behavioral patterns in the Global Fraud Alliance (GFA) repository that indicate either risk (negative signals) or probable safety (positive signals). These raw data signals complement any fraud prevention services a partner has in place today, because they leverage the pooled GFA member payment experiences to enhance fraud scoring accuracy, reduce false positives, improve manual review productivity and enable better decision making, by providing information about potential fraud risk that can’t be obtained any other way. Ethoca360 “Signals” can be completely contained and integrated into partner solutions.
The FTC has filed a complaint in federal court against
Low Pay, Inc.d/b/a as LPC Inc., lowpaycard.com, and mylpcard.com; LP
Capital Holdings, Inc.; Century Luxury, Inc.; the
Mardan Afrasiabi Living Trust; Mardan M. Afrasiabi; and Ramin Rahimi.
alleging that their catalog credit card operation deceptively marketed
The defendants are charged with violating the FTC Act and the FTCâs
Telemarketing Sales Rule (TSR) by falsely representing that the card
could be used to
fully finance purchases; that it would provide access to a no-fee, low
guaranteed cash advance benefit; and that consumers could improve their
credit ratings by using the card. They also failed to disclose that they
debit from consumersâ bank accounts the advance fees, a non-refundable
and 30% of a productâs price plus shipping costs. In addition, the
defendants falsely claimed that they would refund the $120 activation
consumers who returned the card and catalog in timely fashion. The
allegedly violated the TSR by charging an advance fee for a guaranteed
VeriFone and Heartland Payment Systems are clashing over claims that
Heartland is not able to support its customers that use VeriFone
terminals due to a patent infringement issue. VeriFone says it has
informed Heartland that it will terminate its support relationships with
Heartland, effective end of day December 31st. VeriFone says it is
taking action to prevent any disruption to merchants after determining
that the pending litigation over Heartlandâs continual infringement of a
VeriFone patent is likely to impact Heartlandâs ability to maintain
service levels with its customers. Meanwhile, Heartland has pending
litigation against VeriFone, in which Heartland claims that VeriFone is
attempting to line its own pockets by charging merchants unnecessary
recurring expenses. VeriFone estimates that 75% of Heartland customers
in the retail, restaurant and petroleum markets rely upon VeriFone
systems and is asking merchants to register for free support before
December 15th. Heartland says it customers should not be fooled by
VeriFoneâs offer. Heartland says it is fully capable of servicing all of
its customers and VeriFone is not able to support its customers.
Heartland says VeriFone canât because its customers operate on a
proprietary payments processing platforms. Heartland is the only entity
that can provide full service â including ongoing service of VeriFone
terminals â to them.
MoneyGram has agreed to pay $18 million in consumer redress to settle
FTC charges its money transfer system was used by fraudulent
telemarketers to scam millions from consumers between 2004 and 2008. The
FTC concluded MoneyGram agents knowingly helped fraudulent telemarketers
who tricked U.S. consumers into wiring more than $84 million within the
U.S. and to Canada. These consumers were tricked by being told they were
falsely hired for a secret shopper program, they had won a lottery or
were guaranteed loans. In some cases the FTC alleges MoneyGram agents in
Canada actually participated in these schemes. Moreover, 131 of its more
than 1,200 agents accounted for more than 95% of the fraud complaints it
received in 2008 regarding money transfers to Canada. At least 65 of
MoneyGramâs Canadian agents have been charged by Canadian or U.S. law
enforcers with, or are currently being investigated for, colluding in
fraud schemes that used the MoneyGram system.
HasOffers has released its “Fraud Score” solution for its affiliate
networks, allowing them to shut down and prevent affiliate fraud. This
gives affiliate programs full control of their own customizable fraud
detection suite. Already designed to monitor most fraudulent activity,
“Fraud Score” allows networks to define the weight of each fraud
criteria, thresholds for alerts and thresholds for disapproving or
blocking affiliates to identify typical fraudulent activity specific to
their industries. Additionally, “Affiliate Profile Fraud” monitors the
affiliate signup process, preventing fraudulent account signups,
utilizing criteria such as mismatching IP address with state/region,
mismatching phone number with the country, invalid email address domain
and many more.