Latinos Warn of ‘False’ Credit Card

Advertised to Spanish-speakers as a $2,000 line of credit, Pro Line is derided as a scam by consumer advocates.

San Leandro resident Amelia Perez was a bit surprised when her husband Carlos decided to order something called the Pro Line card he saw on TV, especially since it cost $299 to open an account. Maybe he was won over because the ad has been so pervasive on local Spanish-language television. “It’s sometimes two or three times a day,” she says. Or maybe it just sounded too good to pass up; the couple understood it to be a sort of “starter” card with a $2,000 line of credit, designed to help people with little or no credit history establish a solid rating. Like many of the consumers the Pro Line card attracts, the Perezes are working-class Latinos with a limited credit history. They are retired and live off Social Security checks; they have one other credit card but avoid using it. “I don’t know why he wanted this card,” Amelia laughs. “You know how when they talk on the TV, you think, ‘Ooh, this is nice.'”

But the card turned out not to be so nice. Amelia remembers that when she called the toll-free number to sign up, she was explicitly promised she could use it anywhere. “The girl said with this card you can go to any store and buy the same as Visa or MasterCard,” she recalls. “But it was not.” In fact, once Perez sent off her $299 money order and received her new card, she was shocked to discover that the only places it could be used were a catalogue and an e-commerce site, both run by Pro Line. “You could not use it anyplace except the book they sent us!” she exclaims. “We were disappointed really very bad.”

Or take case of Berkeley resident Omar Lliro, who signed up for the Pro Line card to buy a new car he needed for his home repair business. Lliro, who emigrated from Cuba in 1996, liked the part of the company’s sales pitch about how customers’ payment records would be reported to the major credit bureaus so people could shore up their credit histories. “My credit is not that good,” he says. “I saw the opportunity to build up my credit again.”

But then the card arrived. “Right away I knew,” Lliro says. “When I saw those catalogue that they gave me, I said, ‘This is not a credit card, this is a company who wants me to buy things from them and then pay them some money.” It was clear no auto dealer would accept the card, but it was too late — he had already sent away his money. “They don’t allow you to see anything until you deposit the $299!” he laments.

Stories like these are becoming all too familiar to San Francisco-based Consumer Action, an advocacy group that has fielded 350 complaints in the last several weeks from irate Californians wanting out of their contracts with the card company. Joseph Ridout, consumer services manager for Consumer Action, says that while Pro Line is headquartered in Florida, its cards are selling briskly in the Bay Area and Los Angeles, where the company has targeted Latinos with ads on affiliates of networks such as Telemundo and Galavision.

While the ad is ambiguous about what the Pro Line card actually does, Ridout says, the vast majority of the cardholders who contacted Consumer Action said that they were promised a Visa card that could be used anywhere. When they tried to complain, they were often told that the person who handled their initial registration was no longer available or that they must pay a variety of cancellation and processing fees that add up to about $250 of the original $299 deposit. “It’s really just a transparent scam,” he says. “This card has no value whatsoever.”

Carlos Mendez, a principal in Pro Line Card LLC who identifies himself as marketing manager, claims that customers are indeed ordering from the catalogue and Web site. The company, in operation since last November, has about ten thousand customers, Mendez says, of whom two or three thousand are placing orders.

Assuming that’s true, it might still seem strange that just 20 to 30 percent of the cardholders bother to use the card. That is, until you see what Pro Line charges for some of the ten thousand products it boasts are available: A 5.8 GHz VTech cordless phone the company offers for $229.99 sells for $59.99 at BestBuy.com. The Canon PowerShot 3.2 megapixel digital camera, which Pro Line lists for $599.99, is $149.99 from Best Buy. And Pro Line members pay double for that Evenflo car seat or family-size George Foreman grill, compared with Sears or Target’s online shops. “They’re products no one would ever want to buy because you can get it for half the price in the store,” Ridout notes. “There are only three or four people we’ve heard of who have ordered from this thing. They mostly take a look at it and go, ‘Oh my God!'”

It gets even more outrageous: Amelia Perez, one of those few who actually tried to order something, inquired about a $500 home gym and was told she’d need to pony up $300 for shipping. The operator explained that the hefty fee was because of the weight of the product. Perez declined on the gym, but when she later tried to purchase a coffeemaker that Pro Line listed for less than twenty dollars, she was shocked to learn she’d have to pay sixty bucks for shipping. “I said ‘Forget it,'” she recalls. “I can buy it at Walgreens.”

Pro Line’s Mendez defends the price structure as the trade-off a small company must make to do business with clients other retailers might regard as credit risks. Unlike Wal-Mart and other megastores, he says, his company doesn’t deal in bulk. More to the point, he says, Wal-Mart and its ilk won’t finance your purchases without knowing your credit history. Pro Line will. “We don’t ask nothing about the person — where they work, how much they are making in the payroll,” he says.

In fact, you don’t even need a Social Security number — which makes the deal more enticing to illegal immigrants. Mendez portrays the company as one that offers a valuable social service. “It’s mostly for Spanish-speaking customers and people that don’t have credit history,” he says. “We help them to begin that because we don’t check credit history. We only ask them for a down payment.”

Pro Line cardholders are indeed asked to pay a portion of the purchase price upfront — 40 percent, according to the enrollment contract on the Web site, although this number appears to be flexible. The balance is then billed monthly for a year, the contract states. If customers demonstrate that they can pay on time, they are charged less upfront for future purchases, the company claims. Meanwhile, Mendez says, Pro Line helps customers build positive credit histories by reporting their payment records to the credit bureaus.

And what of those customers who thought that their $299 would get them a real credit card? Even the Pro Line slogan suggests as much: su linea de credita personal — your personal credit line. Mendez notes that the ads never claim it’s a credit card. The company does offer a Visa account that people can apply for after they’ve become members, he says, but that offer is not mentioned until after a potential customer has signed up for the catalogue service. “We don’t offer the Visa on the television because that is not our primary business,” Mendez claims. “It is offered after they make the phone call.”

Any confusion for consumers such as Perez, who recalls the explicit promise of a credit card, he says, is the fault of the telemarketers. “Different telemarketers sell the card, and it depends on the people they have answering the phone,” Mendez says. “We try to explain the best way to do that, but sometimes they don’t say exactly the same way that we can say.”

So what exactly do these telemarketers promise? That was hard for the Express to confirm — as of press time, callers were unable to reach an operator at the toll-free number listed on Pro Line’s Web site.

Asked to explain the massive misconceptions about the card, Mendez insists that he manages only the customer service and catalogue sides of the operation, and knows nothing about its telemarketers. The catalogue division, he says, is partnered with a bigger company called the Pro Line Group, headed by a man named Julio Sandoval who is responsible for that aspect of the business.

Although no active company by that name exists in Florida, the two men are listed as principals in Pro Line Card LLC. Sandoval did not respond to interview requests by phone and e-mail. But corporation searches on the Florida Department of State Web site raise questions about the company. Mendez, for one, established three new businesses on July 20 — Premier Card Plus LLC, Latin Card Plus LLC, and Kapital Card Plus LLC. The “suite” from which these businesses operate is a mailbox at a Mail Boxes Etc. franchise. Latin Card’s Web site — almost identical to ProLineCard.com — is registered to an address at a different Mail Boxes Etc. In an August 25 posting at RipoffReport.com, a Springfield, Massachusetts woman claims she ordered the Latin Card Plus after seeing an ad on local TV, but was sent the Pro Line Card instead.

Pro Line, meanwhile, shares a suite in a Miami-area office building with no less than ten other businesses, all established within the past year, and all of which list as principals Mendez, Sandoval, or individuals with business ties to one man or the other. (The names suggest real estate, investments, marketing, and financial services dealings.) But the business address Pro Line lists on its Web site is in another Mail Boxes Etc. that also is home to a business run by two individuals who operate out of Pro Line’s shared office suite.

If any of this sounds suspicious, here’s the tricky thing: It’s perfectly legal to sell memberships to a shopping club, and to charge insane prices. But it is quite illegal to sell a product that is entirely different from what the buyer was promised. Consumer Action alleges that Pro Line is deliberately defrauding people; Ridout says that a majority of the complainants said they were told unequivocally that they were getting a Visa card; many said they asked point-blank if they were signing up for a catalogue and were told no. “We agree with Mr. Mendez that the TV ad does not identify Pro Line’s card as a Visa,” Ridout says. But, he adds: “Once viewers call the company to apply for the card, it is consistently promoted as a Visa. There is so little variation in the customers’ stories that we find it hard to believe that this is not company policy. It would be quite a coincidence if dozens of different Pro Line employees happened to mislead consumers in exactly the same way unless they were directed to provide intentionally faulty information. “

Consumer Action’s suspicions are echoed by the Better Business Bureau. The agency’s southeast Florida branch — on whose turf Pro Line resides — estimates that it has received about 65 complaints about Pro Line from all over the nation, most within the last ninety days. Bureau president Brodie White says Pro Line’s apparent modus operandi reminds him of something called an “advanced fee loan scheme,” in which consumers are promised that a company will find a loan for them if they will send in a processing fee; the company takes the fees without processing anything and tells the unhappy clients that they didn’t qualify. “This is kind of a spin-off of that by leading people to believe they’re getting an unsecured credit card with a $299 application price,” White says.

It’s notable that Pro Line’s sales have taken off in Florida and California, states with sizable Hispanic populations. The BBB’s White says the bureau has noticed an increasing trend of dubious schemes once run on the general population now being specifically targeted at ethnic communities that may not be as savvy when it comes to American banking practices. “It’s an old-school scam with a new market,” he says. “Many of the Hispanic and Spanish-speaking people are immigrants and they don’t have bank accounts or access to regular lines of credit, and they’re looking to establish credit.” Worse, White says, when the victims are economically marginalized people, such as illegal immigrants, they may be reluctant to go to the authorities at all.

“It’s a really brutal swindle,” Ridout concurs. “A lot of people who apply for it really need credit to get through the end of the month — people who needed to pay the electric or water bill and had to go into debt.” He’s heard plenty of horror stories, like the mother of five who used the last $299 the family had saved for groceries to buy the near-useless card. Then there’s the guy who sold his truck to buy the card, hoping to use the $2,000 line of credit to finance a new one. “Now he doesn’t have a truck or a credit card,” Ridout says.

In the Bay Area, viewers have reported seeing Pro Line’s ad on Channel 48, the local Telemundo affiliate. Station spokeswoman Maribel Madrigal says she’s heard of no complaints regarding Pro Line, but says the station will investigate to make sure its viewers aren’t being cheated. “We can look into it and take charge right away,” she says. Brooke Morganstein, a spokeswoman for Spanish-language network Univision, which airs here on Channel 14, say the network has never aired Pro Line ads, and in fact has run a cautionary story about the company in its news programming.

In the meantime, people who have had unhappy run-ins with the company are warning friends and neighbors not to fall for the ad. “They say that it is a credit card made for Spanish people and they will help you with your credit in America,” Lliro says ruefully. “That’s a lie.”

Amelia Perez particularly objects to Pro Line’s portrayal of its product as a “starter” card that will help struggling families get a foothold. “How can you start with something like this?” she says with a sigh.

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