The owner of a U.S. telemarketing firm who blasted U.S. consumers with millions of illegal auto “warranty” robocalls last year will pay approximately $2.3 million, give up his Mercedes, and be barred from telemarketing, under a settlement with the Federal Trade Commission that wraps up the agency’s case against the deceptive operation. In sum, the FTC is collecting nearly $3 million to reimburse victims of the scam.
The settlements resolve FTC charges that Damian Kohlfeld and his two firms made millions of illegal prerecorded calls to consumers nationwide in an attempt to deceive them into buying extended auto warranties or service contracts. The robocalls misled consumers into thinking that the callers were affiliated with consumers’ car dealerships or manufacturers, and that their auto warranty was expiring or about to expire.
The U.S. Federal Trade Commission says the scam raised close to $48 million. Under a settlement deal with the FTC, Damian Kohlfeld will pay $2.2 million, liquidate two investment accounts worth $130,000 and sell his 2006 Mercedes. All of the money collected will be used for consumer redress.
The settlement order also bans Kohlfeld from telemarketing or assisting others engaged in telemarketing, prevents him from making the misrepresentations alleged in the FTC’s complaint, and bars him from making any misrepresentations related to the sale of any goods or services.
"Fortunately for American consumers, the telemarketers who were responsible for millions of unsolicited and annoying robocalls will never be able to telemarket again," said FTC chairman Jon Leibowitz.
"We've also taken away all of their money to provide redress to consumers who were defrauded."
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