Feds – And NY AG Schneiderman – Act To Protect Servicemembers From Financial Fraud

The Consumer Financial Protection Bureau (CFPB), the Department of Defense, and the Federal Trade Commission – together with New York Attorney General Eric Schneiderman – have announced the development of a database to combat financial fraud directed at military members, veterans, and their families. The Repeat Offenders Against Military (“ROAM”) database will track completed enforcement actions against companies and individuals who repeatedly scam military personnel.

The announcement comes a few months after Schneiderman secured a $3.5 million settlement against Rome Finance Co., Inc., an unlicensed lender that solicited through storefronts, including “SmartBuy” in New York, that targeted servicemembers for sales and financing of high-priced electronics. According to Schneiderman, the servicemembers were locked into Rome’s high interest revolving credit contracts, which resulted in the troops paying undisclosed fees and incurring massive debt. He says that his investigation revealed that this network was targeting servicemembers not only in New York, but also in California, Tennessee, Colorado, Georgia, North Carolina, Oklahoma, Texas, and even overseas.

"The ROAM Database will allow us to act much more quickly to stop fraud against members of the military," said Schneiderman. "Had the ROAM Database existed during our investigation of SmartBuy, we likely could have shut them down more quickly and saved countless servicemembers thousands of dollars each. This database will be an important tool in our ongoing, comprehensive effort to crack down on those unscrupulous individuals who prey on the men and women who serve our country."

“As a former Ohio Attorney General, I know how frustrating it is to expose a scam and then see it take root in another state. The ROAM Database will help law enforcement crack down on frauds that cross state lines,” said CFPB Director Richard Cordray.

Law enforcement officials across the country, including state Attorneys General, United States Attorneys, and Judge Advocates (JAGs) from all five branches of the armed forces, will be able to search the ROAM Database for publicly available information about completed civil and criminal legal actions against perpetrators of financial scams against military personnel, veterans, or their families.

Does ROAM complement or duplicate the Military Sentinel network, which the FTC created to gather consumer complaints?

FTC Commissioner Julie Brill answers that, saying of the new database, “The ROAM Database will enable greater collaboration among enforcement attorneys at the FTC and other Federal and state agencies. We see ROAM and Consumer Sentinel as complementary bookends: Consumer Sentinel at the beginning of the enforcement process, and the ROAM Database at the end. I expect that the enforcement staff at the FTC will be eager to use the ROAM Database and to contribute information to make the records as complete as possible.”