Southwest Region

With its proximity to Mexico and high population of bilingual and Spanish-language speakers, the Southwest Region (SWR) has a long history of leading the FTC’s efforts to serve Spanish-speaking consumers. For example, in 1992, SWR brought the first Used Car Rule cases against dealerships that failed to provide a Spanish-language Buyer's Guide when sales were transacted in Spanish, as required by the Rule.

In 1997 and 1998, SWR led national enforcement sweeps, Campana Alerta and Campana Alerta II, against companies alleged to have used deceptive Spanish-language advertising claims to sell health and beauty products. These sweeps resulted in more than 21 actions, including seven cases by the FTC, seven cases by state Attorneys General, as well as cases by the FDA and the government of Mexico. SWR also organized several Health Claim Internet Surf Days with Canadian and Mexican consumer protection agencies in 1997. Authorities surfed the internet for false or deceptive advertising claims published in English, French, or Spanish concerning treatments or cures for serious diseases, and sent hundreds of emails warning advertisers that they must have evidence to back up such claims. SWR filed several enforcement actions challenging deceptive debt collection practices conducted in Spanish, including the agency’s first such case, United Recovery Systems, Inc. (2002), as well as Tono Records (2007) and LTD Financial Services, L.P. (2007). In 2006, SWR sued a mortgage lender and broker, MortgagesParaHispanos.com, for allegedly deceiving Spanish-speaking consumers about loan terms. It similarly challenged deceptive Spanish language auto advertisements in Trophy Nissan (2014) and Cowboy Toyota (2018).

In 2011, SWR led the Commission’s sweep of cases against immigration services scams, which resulted in 15 federal, 49 state, and nine local cases, as well as multiple administrative actions. As part of that sweep, SWR brought a successful enforcement action against an unlicensed notario operation, Loma International Business Group, that allegedly defrauded consumers nationwide. SWR also spearheads the FTC’s First Tuesday group to share best practices and discuss law enforcement actions against immigration services scams. The group comprises representatives from the FTC; the Department of Justice’s Executive Office for Immigration Review; the Department of Homeland Security’s Immigration and Customs Enforcement, U.S. Citizenship and Immigration Services, and Fraud Detection and National Security Directorate; 27 state Attorneys General; and eight state bar Unauthorized Practice of Law departments.

According to the U.S. Department of Labor, Texas employs more debt collectors than nearly any other state. The Southwest Region (SWR) has therefore been active in enforcement and outreach activities directed to the debt collection industry and related financial service providers. In recent years, SWR staff has brought more than ten enforcement actions to enforce the provisions of the Fair Debt Collection Practices Act and other laws, including United Recovery Systems, Inc. (2002), Whitewing Financial Group, Inc. (2006), Tono Records (2007), LTD Financial Services, L.P. (2007), Luebke Baker Associates, Inc. (2012), Goldman Schwartz, Inc. (2013), RTB Enterprises, Inc. (2014), Commercial Recovery Systems, Inc. (2015), Credit Protection Association (2016), Warrant Enforcement Division (2016), and American Municipal Services Corporation (2017). These cases resulted in nine permanent bans on debt collection activities, the assessment of more than $6,600,000 in civil penalties, and judgments of nearly $8,340,000 in equitable monetary relief.

SWR has also brought numerous cases challenging the practices of companies purporting to provide credit repair or debt settlement, including Debt Consultants of America, Inc., Debt Relief USA, Inc., RMCN Credit Services, Inc., United Debt Counselors, LLC, and Student Aid Center, Inc. In 2015, SWR teamed up with the FTC’s Bureau of Consumer Protection, Division of Financial Practices, to hold a Debt Collection Roundtable discussion with industry players in Dallas. That same year, the SWR originated and led the Commission’s first joint state and federal law enforcement initiative to combat abusive or deceptive debt collection practices. Operation Collection Protection ultimately resulted in the announcement of 165 law enforcement actions by the FTC and more than 65 of its local, state, federal, and international partners. From that effort, SWR established the Collection Protection group, a working group that includes the FTC, CFPB, DOJ, 47 state Attorneys General, and 18 state regulatory agencies; the group meets quarterly to discuss debt collection trends and issues and to coordinate investigations.

The Southwest Region (SWR) has developed expertise in handling pyramid and chain referral cases—complex cases to combat conduct that can cause enormous consumer injury. In 2001, SWR sued Skybiz.com, Inc., an international pyramid scheme, and its principals, and recovered $20 million in consumer redress. SWR sued Phoenix-based Vemma Nutrition Company, its owner, and its top affiliate for allegedly promoting a pyramid scheme across the globe—but particularly on college campuses across the United States. SWR obtained permanent injunctions with monetary judgments of $238,000,000 against the company and its owner and $6,790,915 against its top affiliate, which were partially suspended based upon the defendants’ abilities to pay. This year, SWR sued four individuals who promoted a series of different chain referral schemes, including Bitcoin Funding Team, which required the transfer of funds through bitcoin and other cyber currency.

The Southwest Region (SWR) works collaboratively with state and federal law enforcement agencies, industry groups, and consumer groups. SWR holds regular Common Ground conferences and calls with state partners to identify issues and exchange ideas for protecting consumers in our region. The office also participates on multiple consumer protection task forces, to share and gain information from partners about emerging scams affecting consumers. SWR regularly speaks to consumer and business groups and distributes FTC publications throughout the region – at libraries, schools, town halls, fairs, jails, exhibitions, conferences, and conventions. The office also mobilizes outreach efforts in response to community needs. For example, in the weeks following Hurricanes Harvey, Maria, and Irma, SWR worked with state partners and FTC colleagues to host a webinar about consumer fraud and identity theft for those affected by the storms. Similarly, the office has worked with local Chambers of Commerce to educate small and medium-sized businesses about data security and other issues.