As is so common nowadays, debt begins to pile up and overwhelm so many of us as we try and keep up with the Jones’ or just simply make ends meet. When we have nowhere else to turn, many of us look toward debt relief services to ease our burden. This runs the risk, though, of these third party companies not looking out for your best interest, and you have to be careful.
This was the case with Mr. John Vartanian, a man who pleaded guilty to conspiracy to commit mail and wire fraud on Monday. Vartanian helped operate a debt relief scam through two companies, Nelson Gamble & Associates and Jackson Hunter Morris & Knight.
The scheme worked as follows: Vartanian and a few associates would reach out to consumers by phone and offer their debt relief services. In reality, however, these consumers were just giving away their money, seeing none of it in return. The Department of Justice (DOJ) has ordered Mr. Vartanian to pay back over $1.2 million to victims of the scam and will face two years of jail time.
“These scams take advantage of consumers struggling with debt. The Department of Justice will continue to work with its law enforcement partners to protect consumers from fraud, especially when they are targeted based on their financially vulnerable conditions,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer.
The DOJ says the scam ran for over two years, and in 2011, conspirators changed company names from Nelson Gamble & Associates to Jackson Hunter Morris & Knight, claiming the former had gone under. Many consumers who were seeking refunds from Nelson Gamble dropped their inquiries, thinking that Jackson Hunter was an unrelated company that had picked up their account.
In September 2012, the Federal Trade Commission filed a civil suit against both companies for misrepresenting debt relief services offered to consumers. Monday’s sentencing finally closes the book on the case, which was settled back in 2013.