September 16, 2010
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News: FTC Shuts Down Deceptive Six
Six scammers have been put out of their bogus credit card business that took millions from innocent and unsuspecting Americans. The Federal Trade Commission (FTC) reached an agreement with the ring that fronted a business that marketing a credit card that was virtually worthless. Operating under a number of names including Mardan Afrasiabi Living Trust, Low Pay, Inc., LP Capital Holdings, Inc., and Century Luxury, Inc, the six defendants' falsely told consumers that their "Low Pay" credit card could be used to pay in full for merchandise from the company's catalogs when in fact it was only good toward a portion of the product's price. Victims were also told they could use the card to obtain cash advances cost free and no service charge. In doing, the victims were told they could improve their credit scores.
Victims were told they would be refunded a $120 activation fee if they opted out of the program and returned the credit card within a selected amount of time. Furthermore, customers were charged a fee in advance for a guaranteed line of credit, an annual fee, and a 30 percent surcharge off the price of each item, bring the cost of the item way above full retail. Adding insult to injury, the defendants also failed to disclose that they would be debiting the customer's bank accounts for all the fees. Many victims said that they were never refunded any fees despite the fact they returned the credit card within the specified period of time.
Under the terms of the agreement, Mardan M. Afrasiabi, the Mardan Afrasiabi Living Trust, Low Pay, Inc., LP Capital Holdings, Inc., Ramin Rahimi, and Century Luxury, Inc. have been permanently barred from the credit card business or lending business. They also cannot misrepresent any material fact in connection with the sale of any product or service, and must disclose all fees and costs, and the refund or cancellation policy, before consumers are asked to pay. They are also barred from participating or working in a business that is under the jurisdiction of the Telemarketing Sales Rule. They may not make any attempt to collect money on any account established before the order was entered. The order also includes restitution and will be rescinded if the defendants had misrepresented any financial disclosures.