FTC Charges Another Defendant as Part of Crackdown on Bogus Medical Discount Plans

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The Federal Trade Commission has charged another defendant in a case filed earlier this year against an operation that allegedly defrauded uninsured Americans by selling them “medical discount plans” that were disguised as health insurance.

The FTC amended the complaint that it filed in August against United States Benefits, LLC, adding Kennan Dozier as an additional primary defendant in the case. The agency, along with Tennessee Attorney General Robert E. Cooper, Jr., filed the lawsuit against U.S. Benefits and the company’s owner and chief executive, Timothy Thomas, as part of Operation Health Care Hustle, a broader FTC crackdown on deceptively marketed medical discount plans aimed at financially strapped consumers. The FTC alleges that the defendants have misrepresented that they are selling health insurance, called consumers whose numbers are on the National Do Not Call Registry, and made illegal robocalls.

The original complaint named Dozier – who is married to defendant Timothy Thomas – as a relief defendant, alleging that she unlawfully received funds that were the proceeds for the defendants’ illegal activities. The amended complaint alleges that Dozier participated directly in the fraudulent operation. By naming her as a primary defendant, the agency now seeks to hold her personally liable for violating the law.

After the lawsuit was filed in August, a U.S. district court temporarily halted the company’s deceptive actions. The agencies are seeking a permanent ban on the deceptive practices and a return of the defendants’ ill-gotten gains.

The FTC vote authorizing the staff to file the amended complaint was 5-0. It was filed on December 1, 2010 in the U.S. District Court for the Middle District of Tennessee, and is available now on the FTC’s website and as a link to this press release at http://www.ftc.gov/os/caselist/1023084/index.shtm.

Copies of the documents mentioned in this release are available from the FTC’s website at http://www.ftc.gov and from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, DC 20580. Call toll-free: 1-877-FTC-HELP.

(FTC File No. X100046)
(US Benefits)

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