FTC begins Legal Action against Processors!

[MatrixWatch]

FTC begins Legal Action against Processors!

FTC's approach to the allegations strengthen claims in the matrix cases

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The FTC recently commenced a legal action against a group of payment processors for "aiding and abetting" a number of different telemarketing sites._

Links:
FTC Sues Electronic Payment Processors for Facilitating Fraudulent Telemarketing Schemes (Article)
http://www.ftc.gov/opa/2004/02/firstamerican.htm

Lawsuit: First American Payment Processing, Inc., et al (Stipulated Preliminary Injunction)
http://www.ftc.gov/os/caselist/0323261/040120cmp0323261.pdf

Lawsuit: First American Payment Processing, Inc., et al (Complaint for Injunctive and other preliminary relief)
http://www.ftc.gov/os/caselist/0323261/040120stip0323261.pdf
_
The theory of liability is similar to our theory of liability for Ginix, Paypal, PaySystems, etc. The FTC refers to providing "...substantial assistance to businesses they knew or consciously avoided knowing were engaged in deceptive telemarketing." This is similar to our aiding and abetting theory.

If it is good enough for the FTC, it should be good enough for us.
_

[MatrixWatch]

At first glance it may seem that the FTC news release is unrelated to the lawsuits against the matrix sites, but after knowing a few facts about the cases it is clear that this announcement is VERY important.

The lawsuits against the pay processors request that they make restitution to the victims of the matrix scams. The various suits allege that the pay companies knowingly aided and abetted the matrix sites, which led to thousands of people being scammed out of their money. A recent challenge to these allegations is that the theory of aiding and abetting we raise in the class-action lawsuits is without merit.

However, the theory of liability in these recent FTC cases refer to providing "...substantial assistance to businesses they knew or consciously avoided knowing were engaged in deceptive telemarketing." This is similar to our aiding and abetting theory.

This good news comes on top of other recent announcements. In late February a Judge overruled Digital Rivers' challenge to the aiding and abetting theory in the VarietyMatrix case. Then, earlier this month another judge rejected a motion to dismiss by PayRequest in a lawsuit which alleges the aiding and abetting of over 30 matrix sites.