Actions taken so far this year by the Federal Trade Commission include a settlement with a credit reporting agency that provided faulty reports to mortgage lenders and an injunction against a mortgage telemarketer. The moves were taken in line with the agency’s objectives of identifying, stopping and preventing fraud.
The actions were outlined in the fiscal year 2006 Performance and Accountability Report, which compared and evaluated each year’s actual performance to the established targets set forth in the annual performance plan the FTC established.
To achieve the strategic goals of protecting consumers and maintaining competition, the commission applies three objectives — identify, stop, and prevent fraud, deception, and anticompetitive conduct, according to the report.
“We are committed to: identifying the latest scams and anticompetitive practices that develop in this marketplace; stopping them through law enforcement; and preventing consumer injury through education,” FTC Chairman Deborah Platt Majoras said in the report.
Within the activities efforts the FTC engaged in to seek input from mortgage industry insiders and interested groups on its policymaking efforts were workshops, such as one on Protecting Consumers in the New Mortgage Marketplaces that was attended heavily by private sector participants, the commission said.
The year’s key outcomes in the goal of protecting of consumers against credit and financial fraud included a consumer credit reporting agency’s agreement in January to pay $120,000 to settle FTC charges that the agency did not follow reasonable procedures to assure the accuracy of the information in the consumer reports it sold to mortgage companies, according to the report.
Far West Credit Inc., which accepts information not normally reported to the nationwide credit bureaus from consumers whose credit worthiness is insufficient or unavailable at the bureaus, allegedly did not verify such information but used it anyway to create credit reports for borrowers of mortgages insured by the Federal Housing Administration. The information provided by many of the consumers was reportedly false and some defaulted on their mortgage.
In protecting consumers on the National Do Not Call Registry and under the Telemarketing Sales Rule, the report cited that the FTC sought civil penalties and an injunction in May against a nationwide telemarketer of mortgage loans — the case was also the commission’s first alleging transmission of false caller identification information.
Srikanth Venkataraman allegedly was doing business as Scorpio Systems Ltd., selling mortgage loans, refinancing, and other products and services through calls to people whose numbers are listed on the registry. Scorpio transmitted either no caller ID or a phony caller ID, disabling consumers from contacting the telemarketer to stop unwanted telemarketing calls, and failed to pay the fees required to access the registry, according to an announcement.
Amongst the goals the FTC achieved during the fiscal year was surpassing its target of 950,000 number of consumer complaints and inquiries entered into its database by having entered more than 1.01 million. Also while it aimed to garner 40,000 data searches by itself and law enforcement personnel of its Consumer Sentinel database, there were 107,600 searches. The commission also surpassed all targets in number of education publications distributed.
“I believe that the performance and financial information described in this report will give American consumers confidence in the FTC’s work to protect the nation’s marketplaces,” Majoras said in the report.
