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FTC threatens fines, jail for online check service operators

// November 19th, 2009 // Tech News

The Federal Trade Commission has charged those behind the shady online check service Qchex with contempt, and wants daily fines imposed on them until they give up the ghost. The group has launched a new site—a Qchex clone—with the same questionable policies that made Qchex a “dinner bell for fraudsters.” This has left the FTC fuming, and it wants the site’s operators to quit helping criminals rip people off— now . You may remember Qchex from a court order earlier this year —in February, a US District Court ordered the company to halt its illegal operations and to cough up its ill-gotten gains. It turns out that the check creation and delivery service failed to implement safeguards to prevent fraud, a point that the FTC had brought up back in 2006. Qchex apparently created and sent checks drawn from any old bank account without verifying that the person requesting the check was the owner of said accounts. Unsurprisingly, this made Qchex a shining beacon for scammers from around the globe who used the service to steal money from people’s accounts, using those same checks to pay for various goods and services.