Los Angeles, California - California Attorney General Xavier Becerra filed a lawsuit earlier this week against Consumer Rights Legal Services, a so-called “investment recovery marketer” that preyed on victims of securities fraud. This defendant allegedly purchased lists with names of vulnerable investors, many of whom were elderly. The purchased lists, known as “sucker lists,” are used to identify individuals across the country who have lost money after falling victim to investment scams.
Marketers like Consumers Rights Legal Services would call the victims on these lists, describe their investment loss recovery services and overstate their expertise and recovery rates. While on the call, marketers would offer victims this recovery assistance for an upfront fee. Yet, after victims paid the fee, the company routinely failed to deliver on its promises.
“Violating someone’s trust is one of the most personal of crimes. It leaves individuals feeling particularly vulnerable. Consumer Rights Legal Services engaged in this unscrupulous practice often and relentlessly,” said Attorney General Becerra. “At the California Department of Justice, we fight vigorously to protect all Californians – but particularly our vulnerable citizens – from scammers and con artists.”
The Attorney General’s lawsuit alleges that the defendants, who conducted business in California as investment recovery marketers, violated the Telephonic Seller’s Law (TSL). This law prohibits companies from accepting fees to recover or otherwise assist in the return of money from a previous telemarketing transaction until the lost money is actually recovered. The violation of TSL is also an unlawful, unfair and/or fraudulent business practice under California's Unfair Competition Law (UCL) and False Advertising Law (FAL).
Since taking office, Attorney General Becerra has made protecting consumers a top priority. Among other actions, he has urged credit agencies to provide free credit freezes in the wake of the Equifax data breach; issued numerous alerts on price gouging; charged a San Diego jeweler and his wife with unlawful financial and debt collection practices targeting active military families; and voiced his strong support for the Consumer Financial Protection Bureau’s Payday Lending Rule, which will prevent the worst harms associated with short-term payday lending.
Consumers are encouraged to report scams to the Office’s Public Inquiry Unit by calling (800) 952-5225 or by submitting a complaint