Credit card scam is under control, says FTC

Jean Heller recieves some scam-related documents in the mail. (Maria Pouchnikova)

Justice might be blind, but you can leave her a message.

People leaving messages on a Federal Trade Commission hot line got some justice last month.

The FTC caught on to a Philadelphia-based bogus credit card scheme that targeted people with bad credit because victims beefed about it on the hot line, said Joannie Wei, an FTC attorney. They griped a lot, and the FTC not only put a stop to the scam, it got money back for victims.

“We were scouring complaints,” Wei said in a phone interview Sept. 20. “And we saw a trend.”

And that trend was a particularly nasty one that cost victims more than $7.5 million nationwide. Companies run by Justin Diaczuk of Philadelphia, and Montgomery County residents Blake and Chase Rubin preyed on “financially strapped consumers,” according to an FTC news release.


From two bases in Jenkintown and one on Michener Street in Bustleton, the trio would market their Platinum Trust Cards and Express Platinum Cards to people who had applied online for high-cost “payday loans,” Wei said. Such loans usually are sought by people with lousy credit. People who can’t get credit “borrow” against their paychecks. They can roll over the loans if they can’t pay or need more money.

A $100 loan can cost someone $900, Wei said.

Diaczuk and the other men told their victims they could improve their credit standings by paying a $99 upfront fee and $19 a month for a credit card that could be used anywhere Visa, MasterCard or American Express cards are accepted.

That wasn’t true, Wei said, and that kind of lying is against federal law.

The cards were valid only at an online store, operated by the three men, that sold overpriced off-brand products, but the cards were worthless everywhere else, the FTC charged in a January federal complaint. The men also illegally debited their victims’ bank accounts, the FTC charged.

Wei said the scam had been operating since 2009. The FTC got an injunction to stop the three earlier this year, and in late September obtained an order from a federal court in Illinois that permanently bans the men and their companies, Apogee One Enterprises LLC and Marquee Marketing LLC, from telemarketing and credit card marketing.

“And the coolest thing about this is we actually got money back,” Wei said.

The $7.5 million the defendants took from about 70,000 victims has to be repaid, the FTC release stated. Many times, there is no money to get back, Wei said, because scam perpetrators spend it.

So, a scheme was stopped and money was recovered because people didn’t just silently eat their losses; they beefed.


An East Torresdale woman called 877-FTC-HELP in September after she got a couple of mailings offering $100 in rebates.

She said her husband called a number listed on one of the offers and he was told by “the sweetest-sounding woman in the world” that he had to give her a credit card number to pay for about $3 in mailing charges to take advantage of the offer.

“And like a damn fool, I gave it to her,” the woman’s husband said.

That wasn’t all. While the man was on the phone, he was solicited to buy products sight unseen that he was told he could return if he didn’t want them. That’s when it all started to sound sour to him.

He said he didn’t swallow any more of the pitch than he already had, and within a day, the couple canceled their credit card. The company that had issued their card told them no new charges had been listed.

That’s when the lady of the house called the FTC and the Northeast Times to tell her story.

Two weeks ago, the Times reported how common scams are nationwide and how they cost Americans millions of dollars each year. Con artists offering deals big and small or prize winnings in the mails, online or over the phone are victimizing about 1 in 10 U.S. citizens, the FTC estimated.

One wrinkle in the schemes is that people who have Hispanic surnames are targeted.

A Castor Gardens resident who also had read Beware the scam slam in the Sept. 19 Northeast Times said she got a call from someone who said she had won $850,000. She has a Hispanic surname, she said. Her husband is Cuban.

She was told she had to pay taxes on her prize before she could claim it and that she should go to her local CVS story, buy a $400 prepaid debit card and call an Ontario, Canada, phone line and recite the card’s numbers.

The taxes, CVS and prepaid debit card elements are the same that were reported last week.

That resident and others interviewed didn’t fall for the lines they were handed, but many people do, the FTC reports, and that’s why everybody should be careful about what they tell strangers who call with wonderful news about sweepstakes, special offers and other bonanzas from thin air.

A Holme Circle woman was another who didn’t bite, although the bait was dangled persistently and persuasively.

On July 20, the woman was called 12 times in one day by a man with a heavy Jamaican accent who told her she had won a $1.5 million sweepstakes prize. He told her his name was John Baker.

“He even gave me a claim number,” she said. “He was very convincing. If I didn’t know about scams, I probably would’ve fallen for it.”

She didn’t go for it, but he kept trying to get her to buy a prepaid debit card for $899 and give him the card’s numbers. Baker told the woman a team was standing by at Ashton and Willits roads to get word to bring her the winnings.

The woman called police. She said an officer came to her house and spoke to the man when he called again.

“He identified himself as a police officer three times” before the man gave up, the woman said. ••