July 30, 2013

Spokane Valley businessmen accused of running scam

The pair has a history of consumer complaints
By The Spokesman-Review
Spokane Journal of Business courtesy photo

Merchant Services Direct owners Kyle Dove (left) and Shane Hurley in November 2011.
(Full-size photo)

Two Spokane Valley businessmen with a history of consumer complaints about their credit card processing company are now accused of running a scam.

Kyle L. Dove and Shane Patrick Hurley, who operated Merchant Services Direct LLC, which is now called Sphyra, reaped $7 million in profits by deceiving thousands of small business owners, according to the Washington state attorney general.

The two men built a network of salespeople that called small businesses and misrepresented that they could offer lower credit card processing rates and better equipment, according to complaints filed in court by the attorney general. The companies had an “F” rating with the Better Business Bureau.

The Federal Trade Commission is expected to file a complaint in U.S. District Court seeking to stop the two men from doing business in other states.

The accusations are part of a civil action to freeze the business assets and stop further dealings.

According to the BBB, small businesses that signed contracts with MSD were soon saddled with much higher rates than were expected along with having undisclosed fees withdrawn from their accounts.

Company representatives have not returned phone messages.

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