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The marketers of a debit and credit card processing services operation have agreed to judgments of more than $26 million to settle Federal Trade Commission charges that they deceived small businesses throughout the country.

According to the FTC, the defendants’ operation falsely promised that it would save merchants hundreds to thousands of dollars a year in processing fees by offering lower rates than the merchants’ current credit card processing service. The defendants also falsely represented that they would buy out merchants’ equipment leases if the merchants accepted the offer, failed to disclose fees, and concealed pages of fine print until after merchants had signed contracts.

The defendants, all based in Oregon, are Aaron Lee Rian, Karely McCarthy aka Karly Speelman, Merchant Processing, Inc. (MPI), Direct Merchant Processing, Inc., Vequity Financial Group, Inc., and PPI Services, Inc. Rian and McCarthy signed separate settlements, and the four corporate defendants signed a third settlement. Under the settlements, Rian and McCarthy are banned from marketing card processing goods or services for sale or lease. In connection with any product or service, all of the defendants are prohibited from misrepresenting the savings that buyers will receive, that existing leases or contracts will be bought out if a purchase is made, or any material fact relating to the product or service or fees or rates charged. In connection with representing that a particular rate or fee will be charged, the defendants must disclose clearly and conspicuously all material facts, such as the amounts of discount rates, processing surcharges, and cancellation fees.

The settlements prohibit the defendants from altering or adding to documents that consumers have signed without first obtaining their consent, concealing or failing to disclose clearly and conspicuously any terms of a contract, and failing to give consumers a complete copy of any document they sign when it is signed. In addition, they cannot sell, rent, or otherwise disclose personal information about anyone who paid them money before the orders are entered.

Merchant Processing, Inc., founded and owned by Rian, was put under the control of a court-appointed receiver in April 2007. In October 2007, the FTC filed an amended complaint alleging that Rian and McCarthy had opened a new business, PPI Services, Inc., and were continuing to commit the same violations. PPI Services, Inc. was then turned over to the receiver. Both businesses are now being operated lawfully by the receiver, and will be sold to fund payments to merchants who were injured by the scheme. The other two corporate defendants that have settled are Direct Merchant Processing, Inc. and Vequity Financial Group, Inc., both defunct corporations.

The settlements with all of the defendants include judgments of $26,480,041, which will be suspended upon completion of certain events, including transfer of Rian’s real property and his interests in the corporate defendants to the receiver, transfer of McCarthy’s interest in PPI Services, Inc. to the receiver, sale of the real property and the corporate defendants by the receiver, and payment of the proceeds by the receiver to the FTC for consumer restitution. The full judgment will be imposed if the defendants are found to have misrepresented their financial condition. The settlements also contain standard record-keeping provisions to allow the FTC to monitor compliance with the orders.

The Commission vote to authorize staff to file the proposed stipulated final orders was 4-0. They were filed in the U.S. District Court for the District of Oregon.

NOTE: These stipulated final orders are for settlement purposes only and do not constitute an admission by the defendants of law violations. These stipulated final orders have been approved by the court, signed by the judge, and have the force of law.

Copies of the orders are available from the FTC’s Web site at and 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 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 more than 1,600 civil and criminal law enforcement agencies in the U.S. and abroad.

(FTC File No. X070030)
(Merchant Processing)

Contact Information

Frank Dorman
Office of Public Affairs
Mary T. Benfield
FTCs Northwest Region