Ohio AG: Telemarketing Fraud Victims to Receive $2.8 Million

March 3, 2010

Ohio customers of Wachovia Bank whose accounts were illegally debited by a payment processing company between 2004 and 2006 will receive compensation, according to Ohio Attorney General Richard Cordray.

More than $2.8 million will be made available as a result of a settlement of a 2007 lawsuit between the Federal Trade Commission and seven states with Florida-based payment processing companies Your Money Access and YMA Company, owned by Tarzenea Dixon.

The lawsuit accused Dixon and several co-defendants of knowingly processing unauthorized debits through Wachovia Bank on behalf of deceptive telemarketers and Internet schemes that violated the FTC’s Telemarketing Sales Rule.

Between June 23, 2004 and March 31, 2006, Dixon’s company processed more than $200 million in debits and attempted debits by providing its clients access to consumers’ bank accounts.

More than $69 million of the attempted debits were returned or rejected by consumers or their banks as unauthorized charges. In other instances, the merchants either failed to deliver the promised products or services or sent consumers relatively worthless items.

Wachovia Bank N.A. has agreed to issue more than $150 million in redress checks to victims of the telemarketing fraud, of which $2.8 million will go directly to 24,517 victims in Ohio. The checks will reimburse consumers for funds deducted from their accounts by three payment processors that maintained accounts with Wachovia, including Dixon’s company.

Dixon was charged in 2007 by the FTC along with the Ohio Attorney General and attorneys general from Illinois, Iowa, Nevada, North Carolina, North Dakota and Vermont. Her co-defendants are YMA Company, LLC; Derrelle Janey; and Your Money Access, LLC, which also does business as Netchex Corp., Universal Payment Solutions, Check Recovery Systems, Nterglobal Payment Solutions and Subscription Services, Ltd.

The settlement order imposes a $22 million judgment that is stayed based on Dixon’s inability to pay and bars Dixon from any future payment processing. The settlement was filed in the U.S. District Court for the Eastern District of Pennsylvania in January 2010.

Source: Ohio Attorney General’s Office

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