The Checkout

A Blow to the 'Wal-Mart Shopping Spree' Scam

The Federal Trade Commission has obtained a temporary restraining order against a group of companies that have been running what's become infamously known as the "Wal-Mart Shopping Spree" scam.

Here's how the scam worked: Consumers got telephone sales pitches offering gift cards -- usually $200 to $500, mostly from Wal-Mart, but also from Kmart, JCPenney, Macy's and other retailers. To receive the cards, the consumers were asked to first pay a shipping and handling fee ranging from $3.49 to $4.95. The callers wanted payments made through consumers bank accounts and demanded the account information over the phone. If a consumer declined, they often were called repeatedly and sometimes threatened until they relented, the FTC said.

Of course, the gift cards never arrive. Even worse, once the callers had the bank account numbers, they kept drawing money from the accounts.

The FTC estimates that tens of millions of dollars were obtained through the scam, which it calls a deceptive and abusive telemarketing practice. It has received more than 2,000 complaints.

This week, the FTC said it had won a temporary restraining order from the U.S. District Court for the Central District of California in Los Angeles. The court also froze the firms's assets. The agency's goal is to obtain a judgment, either through trial or a settlement, and to get some refunds for consumers. For now, if consumers have more questions, they should call 202-326-2090.

The FTC's action was against a number of firms that the agency believes are all related: Universal Premium Services, Inc., also known as Premier Benefits Inc., of Orange, Calif.; Consumer Reward Network Inc., of Canoga Park, Calif.; Star Communications LLC, of Los Angeles; Membership Services Direct Inc., aka Continuity Partners Inc., of Las Vegas and Connect2USA Inc., of Las Vegas.

By  |  March 1, 2006; 12:11 PM ET Legal Battles/Settlements
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Comments

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I was duped into saying "Yes" when they called me with this scam - just to make them stop blabbing. Somehow, they already had my checking account number and charged me a number of times before I called my bank and demanded a refund. Luckily, I received half of the money back; these days I pay very close attention to my account and simply hang up upon a telephone solicitor's call.

Posted by: Abby S. | March 1, 2006 1:44 PM

I had purchased a gift for my brother (who lives in SoCal) from a SoCal company called intelliflix (like netflex). ANYWAY, he starts getting these phone calls that sound suspiously like this but with my credit card info...And the only way they could have wound up with his cell phone and my card info is through this company. I hope the companies that provide this info (and yes, I did opt out) get slammed too.

Posted by: Columbia, MD | March 1, 2006 3:04 PM

A fool and his money are soon parted.

Posted by: Joe Dirt | March 1, 2006 3:45 PM

There needs to be a huge public campaign telling people not to give their bank and other personal information to anyone over the phone, email, etc. In this case, I don't understand why these companies aren't procecuted for fraud?! It's quite clear that that what they were doing was illegal.

Posted by: Elle | March 1, 2006 4:37 PM

IS THIS A SCAM?
Dear Customer,

CONGRATUALTIONS!!

You have been chosen by WAL*MART online department to take part in our quick and easy 5 question survey.

In return we will send $35 to your confirmed Credit Card - Just for your time!

This survey has been sent only to a few people from our random generator!

Helping us better to understand how our customers feel, benefits everyone. With the information collected we can decide to direct a number of changes to improve and expand our online services.

This information you provide to us is all non-sensitive and anonymous - No part of it is handed down to any third party groups.

We kindly ask you to spare two minutes of your time in taking part with this unique offer!

To Continue click on the link below:

https://www.walmart.com/cservice/survey?customersurvey=546

Posted by: patjohnmei@cs.com | September 30, 2006 9:33 PM

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