CDI Pyramid Promoters Settle FTC Charges; Nearly $2 Million for Consumer Redress

Share This Page

For Release

Three principals of a pyramid scheme promoted through the Internet had promised investors would earn up to $18,000 a month and receive an unsecured credit card with a high credit limit. These promoters have agreed to settle Federal Trade Commission charges that their claims were false and their scheme violated federal laws. The settlement, which requires approval of the court, provides nearly $2 million in consumer redress and would enjoin the defendants from operating pyramid or Ponzi schemes, or any program that promises income primarily from the recruitment of others, rather than the sale of a product. The order would prohibit misrepresentations in the sale of marketing opportunities and specifically prohibit misrepresentations about earnings and benefits, such as receiving unsecured credit cards, from participating in any such program. It also requires liquidation of the businesses through which the pyramid scheme operated.

In November 1997, the FTC charged that Nia Cano of Long Beach, California, also known as Nghia F. Cano, Nina DeCano and Nina S. Cano, doing business as Credit Development International (CDI) and Drivers Seat Network (DSN), and Charles Johnson of Lake Elsinore, California, marketed the pyramid scheme through recruitment seminars and sales meetings across the country. The Commission later added additional defendants, including Bryan McCord of Garden Grove, California. The defendants claimed that, for an initial investment of $130 and monthly payments of $30 a month, consumers could obtain unsecured Visa or MasterCard credit cards with high credit limits and make a much as $18,000 per month by recruiting participants for the program. The FTC alleged that these claims were false.

At the request of the FTC, a Federal District Court issued a temporary restraining order, freezing the defendants’ assets and appointing a receiver to preserve them. Following a November 20, 1997, hearing, the court granted the FTC’s request for a preliminary injunction, continuing the asset freeze and receivership. The FTC asked the court to issue a permanent injunction and to order redress for consumers who were victims of the scam. The settlement announced today would resolve the FTC charges against Nia Cano, Charles Johnson and Bryan McCord. The case will continue against the remaining defendants.

The settlements will prohibit the defendants from engaging in any pyramid, Ponzi or other marketing scheme in which a person derives income primarily from recruiting others into the program. They also will prohibit misrepresentations about earnings and the availability of an unsecured credit card. In addition, each defendant is enjoined from assisting other businesses to make such misrepresentations. The settlements prohibit the settling defendants from releasing the names of the consumers who were recruited to join CDI and DSN. Further, the settlement with Nia Cano requires the liquidation of her businesses. Nearly $2 million in assets frozen by the court will be placed under the authority of a receiver who will implement a redress plan.

The Commission vote to approve the settlements was 4-0.

NOTE: A stipulated final order is for settlement purposes only and does not constitute an admission by the defendant of a law violation. Stipulated final orders have the force of law when signed by the judge.

Copies of the initial complaint and Stipulated Final Order are available from the FTC’s web site at and also from the FTC’s Consumer Response Center, Room 130, Th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC- HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

(FTC File No. X98 0004)

Contact Information

Media Contact:
Claudia Bourne Farrell,
Office of Public Affairs
Staff Contact:
Betsy Broder,
Bureau of Consumer Protection