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October 9, 2015

Iowa Lead List Broker Agrees to Change its Practices Following Consumer Protection Division Sting

List seller offered to provide lists of older Iowans for “blatantly fraudulent mailing”

(DES MOINES, Iowa) An Iowa City-based sales lead list provider will better screen its clients and pay the state $2,500 in a settlement with Attorney General Tom Miller over concerns the company’s lead lists could have helped facilitate consumer fraud aimed at Iowans.

In a settlement reached September 30 with the Iowa Attorney General’s Consumer Protection Division, called an Assurance of Voluntary Compliance, TMone LLC agreed to change its practices by reviewing its clients’ intended use of lead lists and refusing to provide them if the intended use appears to involve consumer fraud. TMone sells consumer lists, or “lead lists,” to direct mail marketers as a part of its business.

The Consumer Protection Division began looking at the role played by list brokers last year, after a 91-year-old eastern Iowa woman was discovered to have been the target of an onslaught of fraudulent mailings. The mailings, from a variety of different operations, included prize schemes and personalized appeals from supposed psychics. The woman’s family reported that she was going broke from responding to the mailings.

“The fact that so many predatory mail operations could zero in on this one vulnerable woman made it clear that sophisticated coordination was occurring,” Miller said. “The buying and selling of target lists through list brokers appeared to be key.”

The Consumer Protection Division attempted to determine whether there were list brokers that would sell lead lists even with clear evidence that consumers would be targeted by con artists. Earlier this year, an investigator located a list clearinghouse website and posed as someone looking for a list of Iowans age “55 to 100” to target in a mail campaign. TMone, a client of the website, indicated a willingness to help.

The investigator made it clear to a TMone employee that the list would be used for fraudulent purposes. The investigator disclosed to a TMone salesman that the plan was to send 5,000 “retirement age” Iowans a personalized letter from a psychic describing a recent “vision” in which the recipient could be seen winning a multi-million dollar jackpot on a specific calendar date in the near future. The investigator also disclosed that the supposed psychic would be fictitious, that the vision was bogus, that other claims in the letter were fabricated, and that the whole point was to see how much the retirees would pay when “the jackpot theme is hammered home.”

Despite the red flags that Iowans would be targeted for what Miller called a “blatantly fraudulent mailing,” the TMone representative was willing to sell a list of 5,000 Iowa residents age 65 and older with the “highest available” income.

“When this sting was brought to the company’s attention, TMone was cooperative in providing information and committing to changes,” Miller said. “We commend them for that. But we are concerned that this sort of willingness to sell lists even in highly suspicious circumstances may be commonplace among list brokers in general.”

Miller also noted that although the victimization of the eastern Iowa woman gave rise to his office’s investigation of the role of list brokers, there was no reason to believe that there was any involvement whatsoever by TMone with the companies that targeted her, or with any lists those companies were using.

In the settlement agreement, TMone denied wrongdoing, but agreed to adopt reforms and pay $2,500 into a state fund for future consumer protection enforcement and education efforts.

On October 1, a company called MCI LC, of Iowa City, acquired TMone (pronounced T-M-ONE) from Enhanced Resource Centers, of Jacksonville, Florida, and renamed the company Mass Markets.

“We call upon other list brokers and list owners to get a clear idea how a list buyer intends to use a list, and to refuse to cooperate in fraudulent or questionable efforts,” Miller said. “They, too, can be held accountable when they know, or should know, that they’re facilitating consumer fraud by their clients.”

General Cautions
Miller cautioned Iowans to be wary of personalized mailings from strangers promising winnings or other life-changing developments. In particular, caregivers of older Iowans are urged to look out for predatory mailing or telemarketing campaigns making too-good-to-be-true promises.

“Once predatory operators identify vulnerable people willing to respond to bogus claims, lists of susceptible victims get circulated and losses can mount quickly,” Miller warned. “Stopping the feeding frenzy from ever getting underway is key.”

For more information or to file a complaint, contact the Consumer Protection Division through the Attorney General’s website at www.IowaAttorneyGeneral.gov or email directly to consumer@ag.iowa.gov. Consumers can also call the Consumer Protection Division at 515-281-5926, or outside the Des Moines area, toll free, at 1-888-777-4590.

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