Complaint Review: First National Credit

Attorney General Lockyer Brings Consumer Protection Action Over Deceptive Credit Card Solicitations by First National Credit

Attorney General Bill Lockyer today announced the filing of a consumer protection lawsuit against First National Credit to halt the allegedly deceptive solicitations being used to sign up Californians for restricted credit cards.

The complaint alleges that First National Credit uses misleading solicitations to enroll customers in its credit card program. In the solicitation, consumers are sent an "Acceptance Certificate" that states approval for a "gold card"with a credit limit of $15,000 and no interest for the first year. Consumers are told to send a fee of $37 or $43 for "rush processing and delivery" of the credit card.

The complaint filed Thursday in Los Angeles Superior Court states that consumers discover only after sending their enrollment fee that the promoted "gold card," unlike a VISA or MasterCard, cannot be used in stores. The company's "gold card" can only be used to order from the First National Credit catalog that the company provides. Those customers who try to place orders find out they cannot even charge the full purchase price using their so-called gold card because First National Credit requires the consumer to pay 25 percent of the purchase price by check or money order. Hundreds of consumers have reported being victimized by First National Credit's deceptive scheme.

First National Credit is a trade name for FNC Investments, Inc., a Nevada corporation with offices in Aliso Viejo in Orange County, California. In addition to First National Credit/FNC Investments, the complaint also names as defendants company president Mahmoud Karkehabadi, and founder Steven Golgolab.