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Check Processor Settles With Attorney General

CONTACT: Elliot Burg, Assistant Attorney General, (802) 828-2153

June 29, 2009 - Payment Resources International, L.L.C. (PRI), a Newport Beach, California, company, will refund more than $18,000 to over 90 Vermont consumers and pay the State $30,000 to settle claims that it processed electronic debits (charges) from Vermonters’ bank accounts on behalf of telemarketers whose scripts were fraudulent or otherwise unlawful. Commenting on the settlement, one of several in recent years involving such processors, Attorney General William H. Sorrell stressed that “the State of Vermont will seek to hold third parties responsible for providing substantial assistance to dishonest businesses.”

According to a court complaint filed by the Attorney General’s Office, PRI violated the Vermont Consumer Fraud Act by making it possible for deceptive telemarketers to charge Vermont consumers’ bank accounts; by facilitating transactions that were illegal under the federal Telemarketing Sales Rules, such as the sale of credit repair and credit cards for an advanced fee; by placing outbound “cold” calls to Vermonters in violation of banking system rules; and by failing to provide consumers with the required three-day right to cancel a telephonic sale.

In addition to the refunds to consumers and the payment to the State, under the terms of a Consent Judgment and Permanent Injunction signed by PRI the company will, among other things, (1) refrain from processing bank debits for “high-risk goods or services,” including credit repair, advance-fee loans or credit cards, offers to reduce the incidence of telemarketing calls, recovery of money lost to fraud, discount membership clubs, identity theft services, and government grants or loans; (2) extensively pre-screen telemarketers before providing bank processing services; and (3) monitor and restrict the return rates of most telemarketing and internet-based clients.

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