Tag: Franchises, Business Opportunities, and Investments

Multi-level marketer AdvoCare International, L P and its former chief executive officer agreed to pay $150 million and be banned from the multi-level marketing business to resolve Federal Trade Commission charges that the company operated an illegal pyramid scheme that deceived consumers into believing that they could earn significant income as "distributors" of its health and wellness products. Two top promoters also settled charges that they promoted the illegal pyramid scheme and misled consumers about their income potential, agreeing to a multi-level marketing ban and a judgment of $4 million that will be suspended when they surrender substantial assets.

The Federal Trade Commission charged three individuals and nine businesses with bilking more than $125 million from thousands of consumers with a fraudulent business education program called MOBE (“My Online Business Education”). A federal court halted the scheme and froze the defendants’ assets at the FTC’s request. The FTC alleged that the defendants falsely claim that their business education program will enable people to start their own online businesses and earn substantial income. They claim to have a “proven” 21-step system for making substantial sums of money quickly and easily from internet marketing, which they promise to provide to those who join their program. Most people who buy into the program and pay for the expensive memberships are unable to recoup their costs, and many experience crippling losses or mounting debts, including some who have lost more than $20,000, the FTC alleged. The defendants agreed to pay more than $17 million as part of settlements with the Federal Trade Commission.

The FTC’s October 2018 complaint against Redwood Scientific charged the defendants with a scheme that used illegal robocalls to deceptively market dissolvable oral film strips as effective smoking cessation, weight-loss, and sexual-performance aids. Announced in June 2019 as part of a crackdown on illegal robocalls against operations around the country responsible for more than one billion calls, an initial  settlement resolved the FTC’s charges against one defendant in the Redwood Scientific case, Danielle Cadiz. The order permanently banned Cadiz from all robocall activities, including ringless voicemails, and imposes a judgment of $18.2 million against Cadiz. In March 2022, the FTC announced the final court orders against all remaining defendants.

The Federal Trade Commission is returning an additional $25 million to consumers who lost money to a business coaching scheme that used the names Coaching Department and Apply Knowledge, among others. These refunds are the result of the FTC’s settlements with the scheme’s ringleaders, the companies through which the scheme operated, and a payment processor who helped facilitate the scheme.

The funder and servicer of the payment plans used by consumers to pay for expensive and often ineffective investment “trainings” from Online Trading Academy (OTA) will be required to offer debt forgiveness to consumers under a proposed settlement with the Federal Trade Commission.

Universal Guardian Acceptance, LLC (UGA) and Universal Account Servicing, LLC (UAS), have agreed to settle Federal Trade Commission charges that they facilitated consumers’ payments to OTA, when they knew or should have known that OTA was deceiving consumers.

Two Nevada companies and two individuals have agreed to stop charging consumers thousands of dollars to apply for multiple credit cards in their names in order to pay for expensive and often ineffective training programs under a proposed settlement of a Federal Trade Commission lawsuit.

The FTC filed a federal court complaint along with a proposed settlement which requires the defendants to stop obtaining credit cards for consumers for a fee. In addition, the defendants will be required to pay $2.1 million under the proposed settlement, which will be distributed by the FTC to consumers.

In September 2021, The Federal Trade Commission sent checks totaling more than $2 million to consumers who were harmed by the company.

The operators of a business coaching scheme will pay at least $1.2 million to settle Federal Trade Commission charges that they targeted people who were trying to start new businesses online and used deception to sell them bogus marketing products and services.

According to the FTC’s complaint, Position Gurus and Top Shelf Ecommerce, and their owners Aaron Poysky, Stacy Griego and Samuel Cohen Brown, targeted consumers who were looking for ways to make money by starting retail businesses on the Internet. The defendants found many of their targets by purchasing consumers’ contact information from other online business coaching operations that had already deceived the targets. In August 2021, the FTC sent refunds totaling more than $1.5 million to defrauded consumers.