FTC 86s LOAN MOD TXTS

FTC watchers will remember Phillip A. Flora.  In the first case of its kind, the FTC alleged that Mr. Flora was a One-Man Message Machine, churning out a “mind-boggling” number of unsolicited commercial text messages pitching mortgage modification services.  How many did he send?  According to the FTC, <Carl Sagan voice> millions and millions </Carl Sagan voice>.

Problem #1:  The FTC charged that sending the unsolicited messages (or causing them to be sent) was an unfair practice in violation of Section 5.  To add insult to financial injury, many people had to pay their mobile carriers to receive them.

Problem #2:  According to the complaint, Mr. Flora collected information from consumers who responded — even those who responded by saying “Enough already with the text messages!” — and sold it to third parties as “debt settlement leads.”

Problem #3:   One of the sites, loanmod-gov.net, displayed an American flag and claimed to offer “Official Home Loan and Audit Assistance Information.”  According to the FTC, that conveyed a false affiliation with the U.S. government.

Sufficient grounds for law enforcement, alleged the FTC — but in the time-honored words of persuasive pitchmen, “But wait!  There’s more!”  The FTC also charged Mr. Flora with CAN-SPAM violations for advertising his text message blasting services via illegal spam.

Under the terms of a settlement entered in federal court in California, Mr. Flora is banned from sending any unsolicited commercial text messages or helping others send them.  For how long?  For forever.

The order also bars him from making false or misleading representations about any goods or services, included unfounded claims of a government affiliation.  In addition, under the settlement, Mr. Flora has turned over $32,000.

If people responded to one of Mr. Flora’s messages, the settlement includes important protections for them, too.  It’s illegal for him to sell, rent, or otherwise share names, addresses, email, account numbers, or other identifiable information he received in response to his illegal messages.  He also has to dispose of — as in burn, shred, or pulverize — customer information.
 

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