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A Southern California-based mortgage broker will pay $50,000 under a court order filed today on behalf of the Federal Trade Commission for allegedly calling tens of thousands of consumers who are on the National Do Not Call (DNC) Registry for telemarketers and for failing to pay the annual fee required to access the DNC Registry. In addition, the company and its officers are permanently barred from violating the DNC provisions of the Telemarketing Sales Rule (TSR) and from making illegal telemarketing calls in the future.

Although the defendants claimed they relied on service providers for their compliance with the DNC rules – specifically by buying “lead lists” of phone numbers from list brokers such as title companies – the FTC stated it was not enough for them to rely on the brokers’ claims that the lists had been properly “scrubbed” against the DNC Registry. A “scrubbed” list is one that has had all telephone numbers that are on the DNC Registry removed from it no more than thirty days before calls are placed. Further, although the defendants paid the brokers for the phone lists, they did not properly pay for access to numbers on the Registry, leading them to illegally call thousands of registered consumers.

“The bottom line is that telemarketers are responsible for complying with the Do Not Call provisions of the Telemarketing Sales Rule, and cannot hide behind the claims of their service providers,” said Lydia B. Parnes, director of the FTC’s Bureau of Consumer Protection. “If a telemarketer purchases a ‘scrubbed’ list, they better make sure that it is current and squeaky clean or else they may be violating the law and subject to penalties.”

The Commission’s Complaint

The FTC’s complaint alleges the defendants violated two primary provisions of the TSR. First, in the course of conducting their business, they allegedly called consumers whose names were listed on the National DNC Registry. At the same time, the complaint states, they failed to pay the required fees to gain access to the phone numbers in the Registry itself.

Term of the Stipulated Order

The stipulated order settling the Commission’s complaint permanently bars the defendants from violating the TSR, or assisting others in violating the TSR and its DNC provisions by: 1) prohibiting outbound telemarketing calls to consumers whose numbers are on the DNC Registry and do not want to receive calls from the defendants; and 2) initiating outbound telemarketing calls to any phone number without first paying the required fee to access the telephone numbers within that area code that are on the DNC Registry. Finally, the order imposes a monetary judgment in the amount of $1,138,551 against the corporate defendant in this matter as a civil penalty, with all but $50,000 suspended due to an inability to pay. The total judgment would become due if the defendants are found to have misrepresented their financial condition. The order also contains standard record keeping and reporting requirements to ensure the defendants comply with its terms.

The consent judgment announced today settles the Commission’s charges against the following defendants: Executive Financial Home Loan Corp., d/b/a Executive Home Loan, a California corporation; Michael Nikravesh, individually and as an officer of Executive Financial Home Loan Corp.; and Ron Fattal, individually and as an officer of Executive Financial Home Loan Corp.

The Commission vote to refer the complaint and proposed consent decree to the Department of Justice for filing was 5-0. The complaint and proposed consent were filed on June 21, 2006, by the Department of Justice at the request of the FTC and are subject to court approval. The filing was made in the U.S. District Court for the Central District of California in Los Angeles.

The FTC’s Bureau of Consumer Protection is committed to ensuring compliance with the National Do Not Call Registry. Consumers can register their phone number on the Registry either online at or by calling toll-free 1-888-382-1222 (TTY 1-866-290-4236) from the number they wish to register.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant actually has violated the law. The case will be decided by the court.

NOTE: Stipulated judgments are for settlement purposes only and do not constitute an admission by the defendant of a law violation. Consent judgments have the force of law when signed by the judge.

Copies of the legal documents associated with these cases are available from the FTC’s Web site at and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint in English or Spanish (bilingual counselors are available to take complaints), or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to thousands of civil and criminal law enforcement agencies in the U.S. and abroad.

Contact Information

Media Contact:
Mitchell J. Katz
Office of Public Affairs
Staff Contact:

Kerry OBrien and Linda K. Badger
FTC Western Region, San Francisco