FTC Says Payment Processor Took Millions

coondoggie writes "The Federal Trade Commission and seven states have charged a payment processor with violating federal and state laws by debiting, or attempting to debit, from consumers' bank accounts on behalf of numerous fraudulent telemarketers and Internet-based merchants. Between June 2004 and March 2006, the payment processing company, Your Money Access, processed more than $200 million in debits and attempted debits to consumers' bank accounts. More than $69 million of the attempted debits were returned or rejected by consumers or their banks for various reasons, indicating the lack of consumer authorization, the FTC complaint alleges."

Comments

Does not appear to be CC related. RTFA

[Shivetya]

They keep refering to "bank accounts" which implies to me that they have the routing number and account number. Most likely preying on people with bad credit who could not get Credit Cards

Defendants withdrew funds from consumers' bank accounts in one of two ways: by electronically debiting consumer bank accounts through the Automated Clearing House Network or by submitting checks and falsely representing that the consumers had approved them.

See http://www.allamericanpatriots.com/48738769_illinois-ag-madigan-joins-six-states-ftc-suit-stop-florida-company-fraudulent-debits

So this is a case of direct taking from accounts or use of fradulenet checks. That is why no Credit Card company raised an alarm, they were not even in the loop