Deducted $449.25 from my Mother's Bank Account
Complaint
Bruce A and Ruth D Schenk
Country: United States
On Friday, May 13, 2011, my Mother received a notice in the mail from her bank stating that she was overdrawn. Immediately my Mother, husband & I went to the bank to check into this situation and was told that Discount Medical Benefits had withdrew $449.25 from my mother's account without her authorization using only her phone number. The bank put an immediate stop on this payment and also sent notice to their fraud department. This company needs to be stopped immediately. This is a telemarketing company and gave the name of Discount Medical Benfits, address-1329 State Road, Champlain, NY 12919, phone 866-442-3943. The bank called this company while we were there and they wouldn't give out a phone number; however, I have obtained it through their website.
Comments
The consumer's dispute was delayed long enough that "MyBen" kept the money, despite first saying there was "no problem" with a refund.
Also note the use of a fabricated or doctored phone recording, to pretend the charge was "authorized".
They are protraying this as just some "easily corrected mistake" or "misunderstanding", right up until after the dispute period runs out.
http://www.scambook.com/report/view/37045/MYBEN-Other-for-447.35-on-07-25-2011
"MYBEN - Other for $447.35 on 07/25/2011
HOW I WAS SCAMMED!, by Louise F. Barnett
On August 22, 2011, I received my monthly bank statement from SunTrust Bank. It showed a withdrawal of $447.35 from my checking account and an image of this "pre-authorized", "no signature required" check, dated July 25, 2011. That image also showed "Customer Service and Refund Policy, (866), 304-2401". Since I had not pre-authorized it, I promptly called that number. I was asked if I would like to hear their original phone call to me. They played a recording of a voice which gave my name and my checking account #, with no preliminary "Hello, This is so and so offering you" etc. etc. I asked for a refund. No problem! I would be receiving a package in a few days. I should return it to the post office, get a tracking #, call the above phone # with that # and they would return the money within 21 days. I did this, returning the package on Sept. 2.
At this point I enlisted the aid of my local SunTrust Bank manager, Fran Haynes. Over the next 2 months she made repeated calls, at least 5, to "Lina", at "Third Party Customer Service Co.", assured each time that the money would be returned within 21 or 7 or 14 business days. We gave up on Nov. 8 at which time I closed that account and filed a fraud report with SunTrust. They turned down my request for a refund because I had reported it too late.
If you type in "MyBen Champlain NY" you will see story after story like mine, a couple of them with the same exact amount of money extracted. The "Company" seems to have a number of variations on its name and a few different addresses in Champlain.
The Police in Champlain are very familiar with this scam but it is complicated to prosecute because the company is headquartered in Montreal.
Louise Barnett
Submitted by Louise on Nov 18th, 2011
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Here is a clue as to why scammers and their payment processors are choosing RCC rather than ACH to run through fraudulent charges.
The ACH system is designed to track and monitor levels of disputes and chargebacks, while with RCC, this is all pushed back on the consumer and payment processor's banks directly and individually, rather than being visible to the members of the payment transfer system (NACHA), as in ACH.
If the payment processor is conniving with their clients, and their own bank is willing to go along with it to get lucrative chargeback fees (like Wachovia did), there really is no mechanism to curtail the growth of fraudulent activity until regulators take action or class action lawsuits are filed.
The result: Growth in fraud fueled by continuing successful theft from consumer accounts, often pushed back onto consumers by their own banks if the dispute deadlines expire, combined with increasing levels of fraudulent customer business by shady payment processors, with a potential legal liability overhang on federally insured banks with these payment processors as clients.
This is "Ponzi" dynamics, as the most likely way it will end is by growing until it crashes with possible bankruptcy. Note that with Landmark Clearing, although FTC got a large judgement against the perpetrators, it was suspended to just take what they claimed they had, and the company may even be continuing in business.
http://www.frbatlanta.org/documents/rprf/rprf_resources/RPRF_wp_0510.pdf
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Lastly, the bank of first deposit should recognize that initiating remotely created checks instead of ACH conversion for ACH eligible items will bypass ACH network reporting and control mechanisms that are established to help originating depository financial institutions recognize potential fraudulent situations.
..."
"For Release: 05/21/2013
FTC Seeks Public Comment on Proposal to Ban Payment Methods Favored in Fraudulent Telemarketing Transactions
In an ongoing effort to protect consumers from deceptive telemarketing, the Federal Trade Commission seeks public comment on proposed amendments to strengthen the Telemarketing Sales Rule’s protections against bogus charges and services.
The Commission’s Notice of Proposed Rulemaking announced today would curtail the use of four payment methods favored by con artists and scammers. The proposed changes would:
Stop telemarketers from dipping directly into consumer bank accounts by using unsigned checks and “payment orders” that have been “remotely created.” These instruments can make it easy for unscrupulous telemarketers to debit bank accounts without permission, according to the FTC.
Bar telemarketers from getting paid with traditional “cash-to-cash” money transfers, as well as “cash reload” mechanisms, that scammers rely on to get money quickly and anonymously from consumer victims.
The FTC has found that unscrupulous telemarketers rely on these payment methods because they are largely unmonitored and provide consumers with fewer protections against fraud. The FTC’s proposed changes to the TSR would make it a violation for telemarketers and sellers to accept any of these payment methods in any telemarketing transaction.
The proposed changes also would expand the TSR’s ban on telemarketing “recovery services” in exchange for an advance fee. In the Commission’s experience, telemarketers who call consumers offering to help recover losses they suffered through an earlier fraud are often engaged in deceptive practices. Currently limited to offers to recoup losses suffered in a prior telemarketing transaction, the existing ban would be expanded to include offers to recoup losses suffered in any prior transaction.Reply !