The Federal Trade Commission and the State of Florida charged California-based CardReady LLC, a payment processing business, with credit card laundering.
CardReady has also been charged for illegally assisting and facilitating a nationwide debt relief telemarketing scheme that allegedly bilked millions of dollars from consumers. According to a complaint filed in federal court, the FTC and the State of Florida accused CardReady executives of arranging for 26 shell merchant accounts to process credit card payments and running a debt relief scam.
In June last year, the State of Florida, along with the FTC, froze assets of the operation based on allegations against five companies who falsely promised consumers with credit card debt that, for an upfront fee, they would save them thousands of dollars by reducing their credit card interest rate. These companies were slapped with charges of credit card laundering under the Telemarketing Sales Rule and illegal factoring of credit card transactions under Florida law.
“Our investigation went beyond the telemarketers who swindled consumers out of their money,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “We also stopped the credit card processing operation that hid their illegal transactions. Credit card laundering isn’t just bad business — it’s against the law.”
Credit card fraud remains among top concerns for consumers. In 2014, losses related to credit card and debit card fraud amounted to $16.31 billion, where card issuers and merchants incurred 62 percent and 38 percent of those losses, respectively.
While EMV and multi-factor authentication are some steps to provide relief in that direction, there is still a long way to go.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More