Federal Appeals Court Upholds District Court Order Barring Telemarketers From Selling Mortgage And Debt Relief Programs

FTC Telemarketing Sales Rule

This month, the U.S. Court of Appeals for the Sixth Circuit issued a decision to uphold the District Court of Northern Ohio’s earlier ruling prohibiting the defendants from selling false mortgage assistance and debt relief programs through a telemarketing scheme. F.T.C. v. E.M.A. Nationwide, Inc., No. 1:12-CV-2394 (N.D. Ohio Aug. 27, 2013). Since at least mid-2010, the defendants were allegedly deceiving consumers by promising that the programs would “help them pay, reduce, or restructure their mortgage and other debts.” According to the FTC’s press release, in September 2012, the defendants were charged with violations of: (i) the FTC Act; (ii) the Commission’s Telemarketing Sales Rule; and (iii) the Mortgage Assistance Relief Services Rule. The court ordered the defendants to jointly pay restitution of more than $5.7 million to the consumers affected by the fraudulent practices.