Attorney General's News Release

November 30, 2007

Nixon obtains order freezing assets of telemarketer that defrauded Missourians through robocalls

St. Louis, Mo. — Attorney General Jay Nixon on Thursday (Nov. 29) obtained a court order freezing the assets of a San Francisco company that gave false information to Missourians in telemarketing calls selling credit card consolidation and credit counseling services. The order, signed by St. Louis City Circuit Judge John Garvey, was issued against Telelytics and its officer Scott Kaplan. Kaplan and Scott Olson, CEO of defendant Generations Direct, have been ordered to travel to St. Louis to give depositions regarding the false information.

Nixon previously obtained temporary restraining orders against Telelytics, along with Generations Direct and Vitelity Communications and their CEOs, in April and October. The April order was entered as a result of the defendants making telemarketing calls to Missourians on the No Call list, and the October order was due to allegations that the defendants were making fraudulent statements in those calls while attempting to make a sale.

Telelytics was making one million robocalls a week across the United States at one time, according to a deposition statement from Kaplan. According to Nixon, the defendants used automated calls to contact Missouri consumers and then told those consumers, among other things, that they had been approved to consolidate their credit cards down to as low as 1.5 percent interest; that the consumers had already been approved by a “certified non-profit agency”; that Debt Solutions was “dedicated to helping folks regain their financial freedom”; and that the consumer would be transferred to a “certified credit counselor right away.” Consumers were told to call a specific person, “Karyn McCarthy,” at an 800 number to receive more information.

Nixon says none of those statements made in the robocalls were true. Consumers who called back were eventually directed to representatives of a separate company who would try to sell debt consolidation and other services to them. “It was important to go to court while our lawsuit against these defendants is still pending and get an order freezing their assets to make sure Missouri consumers are protected,” Nixon said.

According to Thursday’s order, all assets and funds owned by the defendant Telelytics are frozen. Additionally, defendants Kaplan and Olson are ordered to travel to St. Louis at their own expense so that their depositions can be retaken in the case, and they also are ordered to reimburse the state for travel expenses incurred in taking the defendants’ previous depositions. The depositions of Kaplan and Olson are to serve as a sworn accounting of the company’s assets, including who invested in Telelytics, in what amount, the location of those funds and the uses to which the funds were put.

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Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

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