Judge freezes assets of two Spokane men
FTC accuses businesses of telemarketing fraud
U.S. District Court Judge Lonny Suko has frozen the assets of two Spokane men and their businesses in response to Federal Trade Commission claims of “massive” telemarketing fraud.
Ryan Bishop, Michael Rohlf, Advanced Management Services NW LLC (AMS) and Rapid Reduction System’s LLC allegedly worked with Texas-based PDM International Inc. to offer consumers plans that would reduce credit card interest rates to less than 10 percent, or to just one-third the consumer’s existing rate. Savings of at least $2,500 were guaranteed.
But consumers who paid as much as $1,590 for the service received a “Liability Reduction Schedule” that directed them to pay down their balances faster. There were no interest rate reductions, according to FTC documents filed with the court.
Attempts to obtain refunds were either rebuffed entirely or fulfilled only after a $199 nonrefundable fee had been deducted.
When Better Business Bureaus in Spokane and Austin, Texas, inquired about refunds, AMS representatives said the company had delivered the promised service, that customers should have read the fine print, or that they should take their complaint to the Texas company, PDM.
Zan Deery, spokeswoman for the BBB office in Spokane, said 52 of 139 complaints processed at the Fort Worth, Texas, BBB were referrals from Spokane.
The FTC says consumers lost “millions of dollars” as a result of the misrepresentations made by the companies, which often called consumers in violation of do-not-call laws. The companies also used illegal pre-recorded “robocalls.”
Suko issued a temporary restraining order on May 10 against the companies, Bishop, Rohlf, and William Fithian of Texas, but it was not unsealed until defendants had been served.
An asset freeze was necessary, the FTC said, because Bishop and Rohlf were using company funds to buy cars, do home remodeling and make other personal expenditures.
Operations of the three companies are now in the hands of receivers appointed by Suko. An FTC news release says the Internal Revenue Service, FBI and U.S. Secret Service are conducting a separate criminal investigation.