Merchant Account Underwriting Tools

Underwriters and ROSCA

That’s “Restore Online Shoppers Confidence Act” in case you forgot. 15 U.S.C Section 8401-8405.

GOPALKRISHNA PAI, of Puerto Rico, opened numerous Wyoming corporations (you do know about Wyoming corporations, don’t you?) including at least one hundred companies owned and controlled by himself and operated as a common enterprise while engaging in the deceptive acts and practices and other violations of law, according to the FTC.

Through these companies revenue was generated from selling skin care products via negative option marketing. Lots of revenue. Say tens of millions of dollars. https://www.ftc.gov/news-events/press-releases/2019/02/ftc-continues-actions-stop-deceptive-free-trial-negative-option

By obtaining hundreds of merchant accounts for hundreds of products they never sold, Defendants made it difficult for payment processing entities, consumers, and law enforcement to tie Defendants to the products they sold.

Defendants sold each of their skin care products online for a few months at a time, typically three to four months. Selling each of their skin care products for a short time made detection of Defendants’ fraud more difficult.

By the time many consumers discovered the fraud and hidden charges related to their trial products and alerted their credit card companies or regulators, Defendants’ websites for those products were often no longer operational and Defendants had moved on to selling another product using another shell company.

More ROSCA info at link below:

https://www.wileyrein.com/newsroom-newsletters-item-3935.html

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