The Federal Trade Commission (FTC) has announced that the operators of an "extended vehicle warranty" telemarketing scam will face lifetime bans from working in the industry. The defendants, Kole Consulting Group and its owner, Dan Kole, were initially charged by the FTC in February 2022. The scam, known as the American Vehicle Protection (AVP) operation, began in 2018 and targeted hundreds of thousands of consumers, including those on the FTC's Do Not Call List. The scam involved making unsolicited calls to consumers and making deceptive claims about AVP's affiliation with vehicle makers, offering expensive "bumper-to-bumper" warranties.
Samuel Levine, director of the FTC's consumer protection bureau, stated that Kole and AVP "blasted consumers with illegal calls and made bogus claims about bumper-to-bumper warranties." As a result, Kole and his company have been banned from the extended auto warranty industry and have been ordered to pay a monetary judgment of $6.6 million. This is part of the FTC's ongoing efforts to crack down on telemarketing fraud.
The FTC's stipulated final order, which was approved unanimously, bans the defendants from working in the extended automobile warranty and telemarketing industries in the future. The order also imposes a monetary judgment of $6.5 million, with $500,000 to be surrendered by Kole. If the defendants are found to have lied about their financial status, the full monetary judgment would be immediately payable.
The stipulated final order will need to be approved and signed by a federal district court judge from the Southern District of Florida. Earlier this year, the FTC reached a settlement with other defendants involved in the scam, including AVP, CG3 Solutions Inc., Tony Gonzalez Consulting Group Inc., and Tony and Charles Gonzalez. The settlement included a monetary judgment of $6.6 million, which is roughly equal to the amount consumers were scammed out of.
This case highlights the ongoing issue of scams and fraud targeting consumers. The FTC continues to take action against those involved in such schemes, aiming to protect consumers and hold scammers accountable for their actions.