Warranty Extension Scam Telemarketers Targeted by FTC

You know that pre-recorded telemarketing call you have almost certainly gotten telling you that the manufacturer’s warranty on your car is about to expire? Well, it is a total scam, it’s very annoying, it violates almost every telemarketing law on the books and the Federal Trade Commission (FTC) is asking a federal court to shut it down.

The pre-recorded messages inform the randomly-selected consumer that their vehicle’s manufacturer’s warranty is about to expire and that they should “extend coverage before it is too late.” They are told to “press one” to speak to a “warranty specialist.” The “specialist” then mislead consumers into believing that their company is affiliated with the dealer or manufacturer. The consumer is offered a service contract for between $2,000 and $3,000, which, claims the FTC, is falsely portrayed as an extension of the vehicle’s original warranty.

In two related complaints filed in federal court, the FTC took action against both the promoter of the phony extended auto warranties, as well as the telemarketing company that it hired to carry out its illegal, deceptive campaign. (Complaint against Voice Touch, Inc. and Complaint against Transcontinental Warranty, Inc.)

“This is one of the most aggressive telemarketing schemes the FTC has ever encountered,” said FTC Chairman Jon Leibowitz in a press release. “I’m not sure which is worse, the abusive telemarketing tactics of these companies, or the way they try to deceive people once they get them on the phone. Either way, we intend to shut them down.”

According the FTC records, the five telephone numbers associated with the defendants have generated a total of 30,000 Do Not Call complaints. “Consumers received the robocalls at home, work, and on their cell phones, sometimes several times in one day. Businesses, government offices and even 911 dispatchers also have been subjected to the calls.”

Besides totally ignoring the Do Not Call Registry, the FTC alleges that consumers who asked that the calls be stopped often were met with “abusive behavior” or were simply hung up on.

Taking Pride in His Work: According to the court papers filed by the FTC, an officer in the offending telemarketing company “bragged to his prospective clients that he could operate outside the law without any chance of being caught by the FTC.” The same defendant also claimed to be able to make 1.8 million calls per day, including one billion calls for his largest “extended warranty” client.

Also See:
How to Complain About a Telemarketer
Telemarketers to Pay Half-a-million for Do Not Call Violations
The Truth About Cell Phones and Telemarketers