Federal Trade Commission v. Ambrosia Web Design, et al., CV-12-2248-PHX-FJM, U.S. District Court, District of Arizona

Defendants operated a credit card interest rate reduction call room in Tempe, Arizona. Consumers were driven to the call room by robocalls orchestrated by third-party vendors. Unwary consumers who pressed “1” in response to the automated message were directed to the Tempe call room which generally identified itself as some variant of “card services.” The telemarketers then tried to sell a menu of interest rate savings vehicles from transfers to new zero balance accounts to direct negotiations with the current credit card company.

Upon appointment, we took over the call room which had approximately 40 employees ranging from “Qualifiers” who took the initial calls, “Closers” who took those calls from consumers who expressed interest, “Financial Advisors” who communicated with card companies, customer service, and accounting.

The FTC’s Complaint and TRO application alleged multiple specific violations of the FTC Act and the TSR. We found that the core business was unprofitable and predicated, at the threshold, on two illegal practices – robocalls and unauthorized merchant account factoring. As such, we concluded that this business could not operate lawfully and profitably in the context of this receivership, terminated operations, and returned the business premises to the landlord. Consent Judgments as to all Defendants were entered in September, 2013.