Nasty auto robocaller forced to pay $2.3M, sell Mercedes

FTC finishes off auto warranty robocall scam, getting $3M for consumers

At least this time one of these scammers is actually being hit in the wallet. Under a settlement with the Federal Trade Commission one of the telemarketers who blasted consumers with millions of illegal auto warranty robocalls last year will pay approximately $2.3 million in redress and give up his Mercedes.

According to  the FTC the settlement resolve charges that Damian Kohlfeld and his two firms made millions of illegal prerecorded calls to consumers nationwide in an attempt to deceive them into buying extended auto warranties. The robocalls misled consumers into thinking that the callers were affiliated with consumers' car dealerships or manufacturers, and that their auto warranty was expiring or about to expire.

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The settlement concludes a long-running case.  Earlier this year the FTC announced a $655,000 settlement with two other defendants who helped make warranty robocalls.  The FTC also announced a settlement in September 2009 with Transcontinental Warranty, Inc, the company that employed the defendants in this case to make the illegal prerecorded calls, the FTC stated.

According to the FTC's complaint, Kohlfeld and the Chicago-based firms Voice Foundations, LLC, and Network Foundations, LLC, violated the FTC's Do Not Call Registry. The settlement requires Kohlfeld to pay more than $2.2 million. In addition, he is required to liquidate two investment accounts totaling approximately $130,000 and to sell his 2006 Mercedes. All of the money collected will be used for consumer redress, the FTC stated.

Earlier this month the FTC said today that it had permanently killed the operations of a group that it said posed as domain name registrars and convinced thousands of US consumers, small businesses and non-profit organizations to pay bogus bills by leading them to believe they would lose their Web site addresses if they didn't.

In that case, a federal district court shut down Internet Listing Service, a Toronto-based group the FTC said sent fake invoices to small businesses and others, listing the existing domain name of the consumer's Web site or a slight variation on the domain name, such as substituting ".org" for ".com." The invoices appeared to come from the businesses' existing domain name registrar and instructed them to pay for an annual "Website address listing," the FTC stated.

But in this case the defendants got off paying back very little compared to what they took. With that settlement order, the defendants got a suspended judgment of $4,261,876, the total amount of consumer injury caused by the illegal activities. Based on what the FTC called the inability of the settling defendants to pay, they will turn over $10,000 to satisfy the judgment.

Follow Michael Cooney on Twitter: nwwlayer8  

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