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QC based telemarketing company deemed a scam, fined $800,000 by a judge

District Judge Mark Fowler found in the ruling that Misty Barnes, Paul Michael Barnes and their businesses had committed 19 violations of the Iowa Consumer Fraud Act
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DAVENPORT, Iowa — A Quad Cities-based telemarketing operation has been fined $820,000 for defrauding small business owners in at least 13 states According to District Judge Mark Fowler.

Misty Barnes, Paul Michael Barnes, and their businesses were found to have committed 19 violations of the Iowa Consumer Fraud Act.  

The allegations against the pair included "cold-calling consumers and falsely saying they had past-due bills that needed immediate payment; selling non-existent services; and making unauthorized charges to customers’ credit-card accounts."

Judge Fowler ordered the couple to pay the maximum civil penalties of $40,000 per violation, a total of  $760,000, to the state.

"In addition, the Barneses must pay restitution of $60,144 to 15 consumers who provided affidavits and assisted the Iowa Attorney General’s Office in the investigation. The consumers live in Wisconsin, Idaho, North Dakota, Nebraska, North Carolina, Ohio, Utah, Indiana, Illinois, Texas, Tennessee, Arizona and Minnesota."- Judge Fowler 

An owner of a fabric store in Ohio, reported that she lost at least $23,044 to PM Specialties and Milestone Consulting. 

The Barneses and their businesses were ordered to stop telemarketing; selling internet, search engine or marketing boosting services; consulting services involving marketing and telemarketing; and the sale of advertising or promotional items. 

"The Barneses, who have lived and conducted operations in Davenport and Bettendorf, are believed to have moved their operations to Illinois after Miller sued them in Iowa. PM Specialties continues to operate an active website.   Fowler’s ruling said the site contains multiple false statements."

Fowler’s ruling found that the Barneses’ violations included:

  • Calling consumers and falsely telling them they had past-due bills owed for advertising or internet-related services, which they must pay immediately, even though the consumer had never ordered anything. 
  • Selling consumers digital advertising or “internet boosting” services, which they promised would result in increased traffic to businesses’ websites. The Barneses, however, never delivered the services. When pressed by consumers for some proof that services were provided, the defendants provided consumers with false reports both verbally and by telephone, purporting to explain how the internet boosting was working.
  • Informing consumers that defendants are selling ads for the consumer’s local government and that the consumer’s advertisement will appear in local government publications, which was false.
  • Telling consumers who had done business with Universal AdCom in the past that PM Specialties could obtain refunds for consumers from Universal AdCom by adding them to a nonexistent lawsuit against that company.  
  • Making unauthorized credit card charges on consumers’ accounts. When customers complained, the Barneses claimed that another company was using its name and making the unauthorized charges.

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