In a decisive move against telemarketing fraud, the Federal Trade Commission (FTC) has secured a lifetime ban on any outbound telemarketing business and extended automobile warranty sales for the operators of a deceptive telemarketing scheme. The lawsuit, brought against Kole Consulting Group and its owner, Daniel Kole, resulted from their involvement in the American Vehicle Protection (AVP) operation, which scammed consumers nationwide out of millions of dollars by pitching fraudulent “extended automobile warranties.”
The FTC’s legal action against Kole Consulting Group and Daniel Kole commenced in February 2022, when the commission first filed charges. The complaint alleged that AVP engaged in unsolicited calls, falsely claiming affiliation with vehicle manufacturers while deceptively promoting their products as providing comprehensive “bumper-to-bumper” protection, despite costing thousands of dollars.
Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, highlighted the deceptive practices employed by Kole and AVP. Levine stated, “Kole and AVP blasted consumers with illegal calls and made bogus claims about bumper-to-bumper warranties.” He further emphasized the significance of the court’s order, saying, “Today’s order bans Kole and his company from the extended auto warranty industry and imposes a monetary judgment of $6.6 million, continuing the Commission’s aggressive crackdown on telemarketing fraud.”
Under the proposed court order, which the defendants have agreed to, Kole Consulting Group and Daniel Kole will be prohibited from engaging in extended automobile warranty marketing and outbound telemarketing for the rest of their lives. A monetary judgment of $6.5 million has been imposed, with a partial suspension based on the defendants’ claimed inability to pay. Daniel Kole must surrender $500,000 as part of the settlement. Should the defendants be found to have misled the FTC regarding their financial status, the full judgment will become immediately payable.
The FTC previously settled with the other defendants involved in the case in March 2023, effectively concluding legal proceedings against all parties.
The stipulated final orders, approved by a unanimous 3-0 vote, were filed by the FTC in the U.S. District Court for the Southern District of Florida. Once approved and signed by the District Court judge, these orders will hold the force of law.
The FTC’s Southeast Region played a pivotal role in this case, with staff attorneys Harold Kirtz, Hans Clausen, and Chris Gleason leading the legal efforts to bring the telemarketing scammers to justice.
The FTC’s decisive actions against Kole Consulting Group and Daniel Kole demonstrate the Commission’s commitment to protecting consumers from deceptive telemarketing practices. By imposing a lifetime ban and significant monetary judgment, the FTC aims to deter future fraudulent activities and send a clear message to those engaging in telemarketing scams that they will be held accountable for their actions.