Canadians Cheat Americans - Yet Again
Here is another cross-border fraud.
Canadian con criminals take advantage of the "longest undefended border" with ease.
What can you do to protect yourself? Well, don't count on the Canadian Courts for any help.
Cross-Border Telemarketers Face FTC Charges for Deceptive Phone Card Pitches
The Federal Trade Commission has charged a group of Canadian telemarketers with deceiving U.S. consumers through the sale of telephone calling cards. According to the Commission, Fusion Telekom and its principals violated the FTC Act and the Telemarketing Sales Rule (TSR) by misrepresenting that they were from consumers’ banks or credit card companies, falsely stating that the consumers would receive a calling card from them, billing consumers without their authorization, using false or misleading statements in their telemarketing, calling consumers whose numbers are on the National Do Not Call (DNC) Registry, and failing to pay the fee to access the Registry’s phone numbers.
A number of years ago, I explained to the FTC how they could cut down on cross-border fraud.
Unfortunately, when the FTC used only part of my advice, when they hired Malcolm Ruby, an excellent Toronto lawyer.
The FTC completely ignored the pyschological aspect of fraud, and pushed ahead without considering how the FTC's action would look to an Ontario Superior Court Judge.
In the decision, the Court of Appeal noted;
"For the past 20 years, George Yemec and the Yemec Defendants have, for a significant service fee, purchased lottery tickets in Canada for residents of the United States. Basically, from phone banks in offices in Toronto, the Yemec Defendants’ employees annually call tens of thousands of individuals in most of the U.S. offering them packages or groupings of tickets in at least two Canadian lotteries, namely Lotto 6/49 and Lotto Super 7. Once a sale is concluded, a computer operated by the Yemec Defendants generates a ticket number in some fashion not explained in evidence. This information is then transmitted electronically to an authorized dealer in P.E.I., whereupon tickets are issued to one of the Yemec Defendant companies located in P.E.I. The U.S. customer is then furnished with a receipt by mail, by one or other of the Yemec Defendants, indicating among other things, the ticket number or numbers. If the player is fortunate enough to win, a cheque for the winnings is sent, again by mail, to the customer through one of the many accounts operated by these defendants. "
But because the FTC's motion was brought ex-parte, or without notice to the defendants, the Court of Appeal agreed with the Motions Judge, who was deeply troubled about the nature of the disclosure made by the FTC to the Court:
For the most part, the matters about which he voiced concern are questions of law:
1. The instant proceeding was a “stand alone” proceeding and, therefore, distinguishable from the decision of United States of America v. Levy reflex, (1999), 45 O.R. (3d) 129 (S.C.J.), a case in which the motions judge ordered a Mareva injunction against telemarketers in Canada who were targeting consumers in the United States.
2. The Appellants should have disclosed that because of amendments to the Competition Act, R.S.C. 1985, c. C-34, “the field in respect of the prosecution of the present action, both in respect of a claim for injunctive relief and damages, might arguably be occupied”.
3. The Appellants failed to disclose that others at the Federal Trade Commission may have viewed changes to the Competition Act differently from the FTC office in Chicago, which was apparently spearheading the current action.
4. The Appellants failed to bring the details of the United States - Canada agreement concerning the application of each country’s competition and deceptive marketing laws to the attention of Nordheimer J., and, in particular, Article VII.
5. The Appellants did not seek the assistance of the federal Competition Bureau when they decided to prosecute the instant action.
6. The Appellants overstated American and Canadian law by asserting that the activity of the Yemec Respondents was illegal per se. "
So what can you do to protect yourself from these nefarious Canadians, when their own Courts won't stop them?
Buy an answering machine and don't respond to telemarkters. Don't get on the Do Not Call List: just don't pick up.
