CHARLOTTE, NC (WBTV) - It was a scam criminals used to soak your neighbors to the tune of more than $200 million. That money is now coming back thanks to a three year Federal investigation.
Even after Wachovia Bank refunded more than $150 million, the government stayed on the money-trail.
It was a huge scam and there are others like it.
How did this work and what should we watch out for?
It was a scam that Wachovia got caught up in the mid 2000s. Wachovia settled with 740,000 consumers who got scammed. The company that helped take Wachovia down, the government took down Monday.
It began with a telemarketer (mainly operating in Canada) cold-calling customers in the U.S. offering fabulous things like vacations. And health-related items.. like a great new diet plan.
The telemarketer convinced customers to pay on the spot with their credit card. Handling the money, a payment processor, a third party. In this case "Your Money Access" a Florida-based payment processor which took in the money for the telemarketer.
Once customers figured out they'd been scammed and demanded their money from their credit card company the Federal Trade Commission got involved but by then the scammers had shut down.
"The scammer made their money and got off basically without much problem." President of the Better Business Bureau of Southern Piedmont Tom Bartholomy says the FTC didn't stop there.
Following the money trail it went after Wachovia which was the bank for the payment processor, ordering Wachovia in December 2008 to begin issuing more than $150 million in refunds to consumers whose accounts were unlawfully debited by Your Money Access.
Monday, the FTC said it was fining Your Money Access $22 million, banning the company and its CEO from ever doing business again.
"They're already out of business but they're going after and it's a good thing they're going after any assets that this person has to make sure that they don't play these games again."
Bartholomy says now that scam is passe. Scammers have gotten smarter-- instead of asking for credit card information.. money which consumers can get back.. the scammers ask for up-front money from you.. promising you'll see more in return.
Beverly Steward was caught up in such a scam. She said, "I was really hopeful. I really thought sending them that last eighty-nine dollars would get me a job because they told me I'd make anywhere from thirteen to fifteen dollars an hour and when that didn't happen, I mean I was devastated."
"These guys are very very good at what they do.. very good," said Bartholomy. "And this is by far the most popular scam out there right now and it's working."
The Federal Trade Commission is now taking a more active role in not only trying to recoup money from companies doing the scamming but anyone associated with the scam operation.
In the case settled Monday North Carolina Attorney General Roy Cooper who was involved in the case said, "Businesses shouldn't turn a blind eye to fraud so they can make money off victims."
The FTC said the payment processor, the third party, turned a blind eye and should have known it.