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© St. Petersburg Times, published October 18, 2001
LARGO -- Federal investigators have shut down the Largo branch of a telemarketing company called the Tungsten Group and have filed a federal lawsuit accusing the company of using illegal, misleading and deceptive sales practices.
About 120 workers learned of the closure Tuesday when they arrived at work in a nondescript building at 13533 66th St. N, just off Ulmerton Road. A sign was posted on the door, which stated: "CLOSED BY COURT ORDER."
A federal lawsuit was filed Monday against the Tungsten Group, an affiliated company, and two officers of the businesses, Robert Demellweek and David V. Jensen, who reside in Virginia.
Demellweek declined to comment on the allegations, and Jensen could not be reached.
Representatives of the Federal Trade Commission, who have been investigating the company for violations of federal telemarketing laws, also declined to comment.
The federal complaint accuses the Tungsten Group of paying telemarketers to call people with bad credit histories and offer them a loan of up to $1,500, telling them that repaying the loan could improve their credit rating.
To qualify, the consumer would have to pay an advance fee of $100, including an enrollment of $40 and first and last months' payments of $30 each. People were asked to give out checking account information so that the fees could be debited automatically from their account to pay the Tungsten Group, records state.
In reality, court records allege, the customers never got loans. Instead they were enrolled in a buying club that offered items at discounts, called the American Savings Discount Club, which charged a $30 monthly payment for membership.
When consumers tried to cancel their memberships, they had trouble reaching anyone at the Tungsten Group, court records allege, and refunds were extremely difficult to get.
Based on evidence that investigators have already compiled, the agencies on Monday obtained a temporary restraining order against the Tungsten Group that freezes all of the company's assets, allows investigators access to records and prohibits the company from making any misrepresentations in the future about its services.
The company's other offices in Portsmouth, Va., were also shut down this week.