Credit card offers could be holiday humbug

Make a phone call, get a credit card - guaranteed, or so an advertising campaign that targeted Hispanic consumers promised, the Federal Trade Commission charges.

A civil suit resulting so far in a preliminary injunction has brought at least a temporary halt to the allegedly deceptive marketing. The suit seeks penalties and an unspecified amount of consumer refunds for advance payments that were demanded for the cards.

"In no instance did consumers get what they thought they were purchasing," said Andrea Foster, director of the FTC's southeast regional office in Atlanta.

The federal complaint against Florida-based Pro Line Card, LLC, among the businesses and individuals sued, says the promotion left consumers with the false impression that the card was a general-use credit card such as a MasterCard or Visa credit card.

Actually, Foster said, the Pro Line card required an advance fee of up to $299 and was limited to "overpriced" products that were to be bought through a company Web site or a catalog.

The FTC described its legal action, announced in October and filed in U.S. District Court in Miami, as one part of a broad campaign against "fraud targeting the Hispanic community." And a warning about the marketing - issued during the summer by Consumer Action, a San Francisco-based advocacy and educational group, before the FTC made its announcement - was the subject of a Newsday column (Sept. 5, 2004).

Now, Joseph Ridout, consumer services manager for Consumer Action, says there is added reason to look for lessons in the marketing in dispute. "During the holiday season," Ridout said, "people feel a lot of pressure to make more purchases than they do at other times." So, he said, consumers may be more vulnerable to accepting questionable credit offers, and they need to look for signals that an offer may not be what it seems.

Ridout cited one warning sign: a guarantee that a credit card will be issued, no matter what a consumer's circumstances, coupled with a required advance fee.

Foster said her agency has not determined yet how much advance-fee revenues were reaped by the companies sued, including Florida-based Call Center Express Corp. But she said that together the web of businesses - which are not operating now, according to Foster - represented a multimillion-dollar operation.

The Pro Line Web site, www.prolinecard .com, last week had a message in Spanish that said the site is under maintenance and asked visitors to excuse the inconvenience.

Comment could not be obtained from Pro Line or Call Center Express. Unless a settlement brings a faster resolution, the federal litigation could take up to two years to conclude, Foster said, with no certainty at this point as to how much money would be available for refunds even if the government prevails.

Consumers have complained to the FTC that when they called to obtain the Pro Line card or one of the other cards promoted by the businesses sued, telemarketers said they could be used at a wide variety of retailers. An English translation of one TV ad in Spanish for the Pro Line card was cited in legal papers by the FTC.

"Today, we'll discuss the main problem facing the Hispanic community in the United States - credit," the commercial said.

It added: "Are you tired of repeatedly applying for credit cards and never getting approved? The Gold Card from Pro Line has arrived." According to the FTC, the commercial promised that a credit history was not necessary, saying, "No one will be rejected."

The same advertising also was cited in a suit filed against Pro Line and Call Center Express, among others, by the Texas attorney general. Officials of that state office and of the FTC say some consumers have complained that they did not receive even the promised cards.

Jose Sosa, 37, of Brooklyn, said through a translator that he did get a Pro Line card in exchange for his payment of $299. He had heard a radio ad for Pro Line in July.

Believing it was a general-use credit card, he said he hoped that using it would bolster his credit record and put him in better position to secure a low-interest loan to buy a house one day.

He made the advance payment with a money order, got the card and tried using it to buy a cell phone from a retailer only to have the credit card rejected.

Later, he called Pro Line representatives and asked for the $299 he had paid in advance, but he said his refund request was rejected. The reason given him, he said, was that a 30-day deadline had passed - a contention he denies.

So now he has a card he doesn't want, and so far he's out the money he paid for it.

Contact Henry Gilgoff at hgilgoff@newsday.com.

An FTC lawsuit cites 'fraud targeting the Hispanic community' and seeks refunds
 

Source: NEWS DAY