Victoria (May 7, 2020) – The B.C. e-commerce company, RevenueWire, reached a deal with the U.S. Federal Trade Commission (FTC) in connection with tech scam allegations. The Victoria-based company and its CEO, Roberta Leach, agreed to pay US$6.75 million to settle charges alleging RevenueWire laundered credit card transactions for two tech support scams by Vast and Inbound Call Experts. The FTC said that the tech support scams conned tens of thousands of consumers out of more than US$120 million and alleged that RevenueWire not only assisted the tech scammers but knew of their illegal activity. However, the online payments firm clarified that they neither admit nor deny any of the allegations in the complaint.
The Victoria-based company, RevenueWire, reached a deal with the U.S. Federal Trade Commission (FTC) regarding tech scam allegations according to a press release from the U.S.-American regulator. RevenueWire agreed to pay US$6.75 million to settle the FTC charges.
Laundering credit card payments for technology scammers
The Canadian payment processor and its CEO, Roberta Leach – also known as Bobbi Leach – are accused of laundering credit card payments for Vast and Inbound Call Experts (ICE) – the two companies that allegedly used tech support scams to bilk costumers out of millions of dollars.
The complaint alleged that RevenueWire used its merchant accounts to accept payments on behalf of Vast and ICE and hid the payments as software store sales instead of telemarketing sales. The U.S.-American regulator’s complaint, which was filed in the U.S. District Court for the District of Columbia, alleges that RevenueWire violated both the FTC Act and the Telemarketing Sales Rule (TSR).
‘Finding ways to get paid – without getting caught – is essential for scammers who steal money from consumers,’ said FTC’s Director of Consumer Protection, Andrew Smith. ‘And that’s exactly what RevenueWire did for tech support scammers when it laundered their transactions through the credit card system.’
‘We’re dealing with a bunch of crooks here’
The FTC further alleged that RevenueWire not only assisted and facilitated the two tech support scams but was aware of their illegal activity at the time. According to the complaint, RevenueWire received various warning signs such as complaints from business partners and consumers.
Additionally, a RevenueWire fraud analyst warned about the Vast management in 2013 in a series of emails shared with company executives, which were quoted in the FTC’s filings: ‘We’re dealing with a bunch of crooks here […] and we are intrinsically associated with anything they do. […] I don’t particularly fancy [RevenueWire] being caught up in a money laundering investigation because of these clowns, but if things continue on as they are, it’s eminently possible that we will be.’
‘In this matter, RevenueWire was at the center of the deceptive business model, and knew that the call centers and telemarketers were making deceptive statements,’ concluded FTC Commissioner Christine S. Wilson in a statement.
RevenueWire’s US$6.75 million settlement
Last month, the FTC announced that RevenueWire agreed to settle the charges. They reached a deal that requires the B.C. e-commerce company to pay US$6.75 million. Furthermore, the terms of the proposed settlement contain that RevenueWire is permanently banned from any further payment laundering or violations of the TSR and they are required to thoroughly screen and monitor high-risk clients to ensure those clients are not misleading consumers.
RevenueWire neither admits nor denies any of the allegations in the complaint. Reportedly, RevenueWire corporate counsel Rajiv Gandhi said the company decided to settle rather than enter into costly litigation with the U.S. government over complaints that are more than half a decade old, relating to parties with whom the Canadian company no longer does business.
A member of Victoria’s tech community expressed relief at the settlement. ‘This was a stain on online advertising, the tech industry, and Victoria,’ wrote Rajiv Khaneja, a local entrepreneur who founded digital ad platform Adbutler, on Twitter. ‘I am very happy with the FTC’s action on this. The scam targeted non-technical users, like most people’s grandparents, and stole their money.’
The tech support scams
The FTC’s tech scammer allegations refer to previous lawsuits against ICE and Vast. The FTC says they conned tens of thousands of consumers out of more than US$120 million by convincing them they needed unnecessary tech support and computer software between 2011 and 2014.
According to the FTC, the defendants have used software designed to trick consumers into thinking there are problems with their computers. The software misrepresented that consumers’ devices had viruses or performance problems and needed to be repaired. Then, those consumers were directed to high-pressure deceptive sales pitches for tech support products and services to fix their non-existent computer problems at a cost of hundreds of dollars.
‘These operations prey on consumers’ lack of technical knowledge with deceptive pitches and high-pressure tactics to sell useless software and services to the tune of millions of dollars,’ explained Jessica Rich, director of the FTC’s Bureau of Consumer Protection in a press release 2014.
Marina Burghard writes for Canadian Fraud News about fraud-related cases, whistleblower, jurisdiction, identity theft, consumer protection, etc. – essentially about scams and how to protect yourself against this kind of fraudulent criminal behavior. She holds a Master’s degree in Political Science where her interest in criminology grew. Besides fraud, Marina’s scientific interest lies in terrorism, extremism and how to deal with it as a society.