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Jun 05

The end of Rachel at Cardholder Services’ road?

Editor’s note: This is the last of four parts about the annoying “Rachel” from Cardholder Services telemarketing calls. You can find part one here, part two here, and part three here.

So, by now we have a good understanding about what I suspect makes “Rachel” work, the players behind her, and how to fight back, but the question remains, what is it going to take to put her out of our misery once and for all?

Gavel

What is the Government doing with the ‘Do Not Call’ list reports?

Over the last several years, there are a number of things that has had a backlash against “Rachel”, although it doesn’t seem to slow her down too much.

  • As I stated in the first part, the Federal Communications Commission issued a citation against Cardholder Services, and effectively shut them down in March 2007.
  • North Carolina’s Attorney General won a permanent injunction in April 2009 against Possibilities Unlimited, with a $572,000 settlement.
  • The Federal Trade Commission adopted new rules on robocalls that went into effect on September 1st, 2009.
  • The FTC settled with Economic Relief Technologies for more than $25 million in July 2010.
  • JPM Accelerated Services met the wrath of the FTC in February 2011, to the tune of $5.9 Million
  • In June 2011, Dynamic Financial Resolutions reached a settlement with the FTC for $3.4 Million.
  • As I reported in January, Castle Rock Capital Management had a complaint issued by the FTC in December 2011. The case is still in district court, awaiting further dates.
  • The FCC issued updated “robocall” rules on February 15th, 2012 requiring that telemarketers must offer an automated “opt-out” mechanism during each call, eliminating the “established business relationship” exemption, and now requiring prior express written consent to allowing robocalls.
  • The FTC filed a Complaint and settled with VoiceBlaze on February 24th, 2012, resulting in a $1 Million fine for the company, and $10,000 fine against each owner.
  • February 2012 also brought a case against Voice Marketing by the FTC, settling with a $2 Million fine, as well as $10,000 fine for the owner.
  • SBN Peripherals and Asia-Pacific Telecom operations were closed by the FTC in March 2012, concluding a 21 month case with $5.3 million in fines.
  • Castle Rock Capital Management was also fined $945,000 by the Mississippi Public Service Commission on May 8th, 2012.

“Rachel” shows no signs of stopping though, based on the number of complaints found by a Google Search, or the number of hits on my story in January.

That is why I think there’s something more to “Rachel” than just a bunch of companies…

Medusa

Greek Mythology describes Medusa as having snakes for hair and a face that could turn mortals to stone.

MedusaIn the case of “Rachel”, we know there are multiple players identified as being the parties involved.  The problem is, using the estimates I gave in part two, is there enough money in this business to support all of them by the time the equipment costs, staff costs and recurring operating costs added in?

What if, each of these companies were just operating the boiler rooms, and a central company incurred the costs of the predictive dialer and VoIP services? Each of the boiler rooms would pay a small amount back to the central company for having the calls sent their way, which in turn pays the central company’s bills.

The central company could have formed out of the remains of the original “Cardholder Services” after the Federal Communications Commission shut them down in 2007.  The equipment was likely transferred into this new company, which explains the continuing use of “Rachel” and the name “Cardholder Services”

The fact that the Department of Justice and Federal Trade Commission have shut down some of these operations, yet it doesn’t seem to faze the call volume – much like they took and cut off one of the snakes on Medusa’s head.  Medusa is still alive, and there’s a potential that another snake will grow to replace the one we cut off.

If that is the case, the only way to stop “Rachel” would be to go for the predictive dialers and seize them – much like how Perseus beheaded Medusa to kill her. Without the predictive dialers, and the central company under an injunction, the players would have no way of surviving, and would die off naturally.

Even if it is proven a central company doesn’t exist, the DOJ and FTC need to mandate the companies surrender the predictive dialers, as they are illegal since they fail to confirm numbers against the “do not call” lists. Without getting the dialers out of circulation, there is no way to verify that they are not just being moved to a new facility and put back into service by a “new” company.

Conclusion

The fight to stop “Rachel” will be a long and tedious one. It is going to take patience on our part, along with the hard work of the Federal Communications Commission, Federal Trade Commission and the Department of Justice to continue to strip away at her, one player at a time. The war could end tomorrow, or years from now, but it will end.

And like all wars, it will take time for the warriors to be victorious.

Needless to say, some other scam will probably come along to take her place and separate people from their hard-earned money, as well as exposing them to identity theft.

About the author

Michael Jones

Michael Jones is the founder of On The Spot Communications and On The Spot Blog.

A native of Ottawa, Kansas (approximately 60 miles South-West of Kansas City), he was born in the early 70's and lived most of his early life without traveling far from home.

He has since lived in Lenexa, Kansas (suburb of Kansas City), Houston, Texas, and now resides in Frisco, Texas (north of Dallas, Texas). He has had the experience of traveling to Tokyo, Japan and Tel Aviv, Israel, as well as numerous places around the USA.

A self-professed computer geek, when Michael's not working in his telecommunications job, he enjoys Model Railroading and Paintball.

Michael Jones is the founder of On The Spot Communications and On The Spot Blog.
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  • When discussing some individual “cardholder service”, it seems there are usually two larger parts of each “Voice service/client“. One is “voice broadcasting”, voice marketing, Act, Bmc, V3 Software, i.e. Some Groups may be large enough to have the Voice Broadcasting System within their “front companies”.

    http://www.ftc.gov/os/caselist/0923174/120224ebersolecmpt.pdf

    And the other is their “client” or “Private Label” include JGRD, Inc, supposedly selling a “Product” or Service”. Seems “when the “s**t hits the fan” , they both point the finger at the other, as the bad guy (or another similarly named “company“). Each “domestic LLC, or Inc. seems to operate one or more “foreign for profit business entities”, or also referred to as an “offshore foreign shell company”. The U.S. Secret Service has jurisdiction over the foreign entity”, at least at first, it seems, until the FTC takes action.

    Now, this is where the really weird stuff begins.
    Ambrosia Wed Design seems to be the anomaly to the usual “third party debt collector” front company. Several “companies” where requested their Do Not call Policies.
    Nothing has ever been received. It’s simply not enforced (for an individual) by the FTC under TCPA laws. Here’s what the illusive document supposedly looks like.

    http://b2bvb.com/compliance/B2BVB_Business_Policy.pdf

    The “third party debt collector front company” will claim they don’t, nor even have the resources to offer “debt reduction, debt consolidation. They tell the AG office- all calls are lawful under FDCPA debt collection laws. Do Not Call does not apply to them?
    But their “affiliates” are always “Capital” this or “Financial” that, “foreign for profit business entities“. Further, the “owner” is often his own “Agent of Process” of both foreign and domestic “affiliates“. How can that possibly be legal? They cant be properly “served” on a fictitious “ foreign entity address/location.

    Here are some more “Voice Broadcasting companies”.
    Will the real “Rachael” please stand up?
    SoundBite Communications Inc. provider of cloud-based multi-channel communications, i.e. “Rachael, at cardholder services”
    Rob Perry, CEO of Telsolutions LTD, a SoundBite reseller partner, &
    RACHAEL Royds

    SoundBite Communications

    +1 781 897 2584

    rroyds@soundbite.com

    “Broadwing Communications, LLC”, “Level 3 Communications, LLC”. 347-218-0531 Tallahassee, FL

    Voice Broadcasting Corp.
    1527 South Cooper St. Arlington, TX 76010
    Sales and Services: 800-231-5629 or 817-462-0717
    Fax: 817-273-5950
    Email: jfournier@voicebroadcasting.com

  • Nemstar1

    After reading your series, and reviewing others’ complaints and stories, I keep thinking of Arnold Zeck, the arch-nemesis of Nero Wolfe (Rex Stout’s fictional detective). Zeck was infamous for have layers upon layers of criminal enterprise, so that the money trail was always difficult to follow, especially as at times the various layers were unaware of the presence of those even working with them. It would be interesting if this is being funded by one or more of the mafia organizations, or even by, say, Al Quada – or just someone who doesn’t fear effective reprisal from our government agencies, for whatever reason.

  • How about Wal lStreet?
    I’ve found direct connections to a couple of TBTF (to big to fail-bailed-out) banks. Client Services Inc/Red Leaf Capital/Financial Services Solutions did/does highly questionable “third party collectons” for Chase, and Citi-bank. Many posts have been made by former employees.

    http://www.complaintsboard.com/complaints/client-services-inc-st-charles-molenexa-ks-office-lenexa-kansas-c352876.html#c1085833

    Bank of America had, or still has an office, same address, ph, as FIA Card Services. FIA has Consumer complaints that describe robos that begin with the typical “Hello, this is Rachel/Heather/Ann at cardholrder/account services SCAM!  

  • RachelsDaddy

    Maybe the Government isn’t in too much of a hurry to shut these buttheads down because it’s a source of income for them through the fines. That is if they ever collect on any of them…..

  • Socialmange

    Thank you for this series, it was fascinating, especially the explanation of the telecomm operation and business model.  I’m in Canada and have started receiving these calls, although a complaint to the Canadian version of FTCC seems to have stopped them.

  • KewlDawg

    All of the “Rachel” calls I still get, are from different numbers. Some of those numbers displayed on my Caller ID are from area codes that are not even in use.

    My belief now, is that these numbers are simply spoofed. Fake. And if they happen to be real, that’s just a coincidence (and makes the real owner of that number, an innocent victim).

    IMHO, reporting these fake phone numbers really does nothing to help stop “Rachel”.

    • Bill_Levinson

      They are spoofed. I even filed a complaint with my local police department for harassing phone calls, which was required for the phone company to act on them. The phone company can’t trace them either.

      You can’t (legally or as a practical matter) dispense broken bones as described above, but you can waste their time by pretending interest and then letting them wait on hold while you “go look for” your credit card. Wasted time is wasted money at their end.

      • Tom Larsen

        The FCC could shut this down with a simple rule change. Simply mandate that the telecom carriers are required to validate the CallerID digits on every call placed through the carrier, confirming that the CallerID matches a number that the originator owns. This puts the onus on the carriers to make sure they’re not acting as a profiting accomplice to the scammers in connecting the already illegal spoofed calls. Drop a $1000 per “spoofed call” fine on the carrier and give half to the victim reporting the crime. Carriers will then block these calls right after the point of origin. Do this, and you’ll have to rush to say bye bye to Rachel.

        • brad tittle

          Caller ID is apparently a little bit fragile as it is. Mandating this may actually cause an increase in the effectiveness of Rachel because all calls out of your local phone district will not have a Caller ID and won’t be let through.

  • CharlieAdamsInKY

    Wanna stop this? Quit wasting time with injunctions, which these outfits can just ignore, and start dispensing broken bones – one additional bone for each additional violation.

  • p3orion

    Obviously, reporting them doesn’t work. Neither does pressing 3 “to be removed from the calling list;” that just confirms that there’s a live body at your number.

    The trick is to make it as unprofitable for them as possible. These cold calls are a numbers game: only a small percentage of the people called actually answer and press 1, and only a very small fraction of those actually do anything. Anything that slows down the process, wasting several minutes of time for “Rachel” and her friends, really eats into productivity down at good old “Cardholder Services.”

    So that’s your goal: waste as much of their time as possible, both to ruin the telemarketer’s “numbers” on the calls he’s placed (which will eventually get him fired) and to tie up the company’s phone line.

    Go ahead and answer and press 1 to speak to a live person. This is your victim. Let him read his whole script, while you pretend to be interested. That’ll already have his mouth watering, as most people won’t stay on past the first sentence or so. Finally, spring your trap: tell him it sounds interesting, and ask him to wait while you go collect your credit cards and bills. Then set the phone down and go about your day.

    Now you can let it go at that; you’ve already taken up a good bit of the telemarketer’s time, and it’ll take several more minutes before he gives up his dwindling hope that you’re ever going to return to the phone. However, he started this game, so you might as well have some fun while you’re winning it.

    So, if you really want to screw with him, come back every few minutes to touch base and build up his hopes again. Apologize for it taking so long, explain that your wallet is upstairs, that you need to find a pencil, etc. This is acting, and putting on a good performance counts. I find it especially helps if I pretend that I’m elderly, as it makes these lowlifes think that they’ve found “easy prey” worth waiting for, as well as helping to explain why it’s taking so long for you to come back.

    See how long you can string them along. (My personal best is 18 minutes.) Don’t feel guilty; you’re only hurting people who desperately deserve to be hurt. Time they waste with you is time that they’re not scamming some elderly widow in Iowa. While the doofus who called is sitting on hold futilely waiting for you to come back, maybe he’ll take some of that time to think about getting into a new line of work.

  • anyone know the address… I’ll throw a molotov cocktail right on their predictive dialers.

  • I have had a woman who must have been Rachel/Heather/Ann tell me that if were to sing “Mary Had a Little Lamb” she would remove me from their call list. Needless to say, you all know how well that went!!!!

    • Tom Larsen

      I’ve been receiving these calls for 4 years, even after changing my number 3 times. Asking them to remove your number is a waste of breath. Once a number is on their list, they’ll call you repeatedly. I’ve played along to waste their time dozens of time. Just today, I wasted 18 minutes of Crystal’s time before she hung up on me. Toying with them will not stop them. Only the FCC can stop this. The FCC could shut this down with a simple rule change. Simply mandate
      that the telecom carriers are required to validate the CallerID digits
      on every call placed through the carrier, confirming that the CallerID
      matches a number that the originator owns. This puts the onus on the
      carriers to make sure they’re not acting as a profiting accomplice to
      the scammers in connecting the already illegal spoofed calls. Drop a
      $1000 per “spoofed call” fine on the carrier and give half to the victim
      reporting the crime. Carriers will then block these calls right after
      the point of origin. Do this, and you’ll have to rush to say bye bye to
      Rachel.

      • Dough Boyd

        I have written documentation of these Rachel calls filed with the FTC and FCC going back to 2002, it is now 2015 (for those of you educating yourself on Rachel in 2023…) and despite 35 cases filed by me, I’ve never received so much as a peep of information concerning the cases like I was told I would.
        Anyway, there has to be a easy simple solution to end this. No longer allowing spoofed Caller IDs would be a great start. Seizing equipment when catching these companies seemed like a common sense approach! I shouldn’t be, but I am stunned to read they did not do this.

        • Since I wrote this, there have been 5 companies that I know of that have been sued and forced out of business in regards to Rachel (while paying big fines to the states and Federal Government that sued them).
          While I don’t have the number of phone lines I once had to catch Rachel calls, they are still out there, but much less frequent. I have been fighting back against the Microsoft Tech Support scammers more now than Rachel (and with my technical knowledge, I can keep them busy for a while so they are scamming a lot fewer potential victims).
          In the end, the never ending case of Rachel returns to the theory I wrote about of a Medusa. These companies that are taken down are just the snakes, and we have yet to behead the Medusa known as Rachel. As I said earlier, the states were involved with the lawsuits, since the State Attorney General is more concerned with protecting consumers than the Federal Attorney General, the Federal Trade Commission and the Federal Communications Commission.
          As far as blocking the spoofing of caller ID numbers, most major carriers are doing that already, but there are some carriers that do not (since they’re making money they could care less). There are also public phone gateways in use by Skype and other Voice over Internet providers that present unusual numbers masking the call of its true origin (this is how the Microsoft scammers work).

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