FTC Investigation of Credit Card Solicitations: Rachel from Cardmember Services

The Federal Trade Commission escalated its campaign against illegal, unwanted robocalls announcing that it pulled the plug on five companies based in Arizona and Florida allegedly responsible for millions of illegal pre-recorded calls from “Rachel” and others from “Cardholder Services.” 

The FTC held a summit in Washington, DC, to examine the robocall problem,federal courts granted the agency’s request to temporarily halt five robocall operations that allegedly deceived consumers into paying hundreds or thousands of dollars by making phony claims that they could reduce credit card interest rates in return for an upfront fee.

1. Telemarketing complaints about Rachel and Cardmember Services

This is a common scheme. The FTC gets more than 200,000 complaints each month about telemarketing robocalls, including calls from “Rachel” that pitch consumers with a supposedly easy way to save money by reducing their credit card interest rates.  After collecting an up-front fee, however, the FTC believes that the companies do little if anything to fulfill their promises.

Creditor and Do Not Call List

Why do you keep calling me, this is very disruptive, take me off your list.

2. How the Cardmember Scheme Works

In the robocall cases the FTC alleges that the defendants place automated calls to consumers, typically with a prerecorded message from “Rachel” or someone else from “Cardholder Services.”  The calls purport to have an “important message” regarding an opportunity to reduce high credit card interest rates. 

Consumers who reach a live telemarketer are then pitched allegedly deceptive offers to have their credit card interest rates substantially reduced, sometimes to as low as 6.9 or even zero percent.  The telemarketers allegedly guarantee that lowering card interest rates will save the consumers thousands of dollars in finance charges in a short period of time and will allow them to pay off the balances more quickly.  Some telemarketers allegedly claim that consumers will save at least $2,500 in finance charges and will be able to pay off their balances two to three times faster, without increasing their monthly payments.

The complaints also charge the defendants with multiple violations of the Telemarketing Sales Rule (TSR), for misrepresenting their services, calling numbers on the Do Not Call Registry, and collecting up-front fees. 

3. Handling Calls


Unfortunately, since the companies are involved in unlawful activity, frequently fraudulent activities, their identities are hard to uncover.

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