A work-from-home scheme was successfully halted by The Federal Trade Commission on Monday. People under this scheme were convinced that they could easily make $379 per day. A temporary restraining order against businesses operating under multiple names was agreed upon by a federal court in Utah upon FTC’s request.
Consumers pay millions of Dollars
The Federal Trade Commission highlighted some of the frauds being undertaken by the businesses which also included offering phony resources to users, misleading them. They were made to believe that they could start an online business with these resources which cost anywhere between $37 and $99.
The sale of kits and services, which apparently help users to launch a business, seemed to be the only agenda of these fraud businesses. No useful information for setting up business was actually provided to users. Though it is not clear how much money the schemers were able to extract from the consumers, the consumers were convinced enough to purchase their program which cost between $3000 and $12,000. This cost was charged on their credit cards.
Consumers deceived to start online business
The companies involved in the scam include Essent Media LLC, Net Training LLC, YES International, Coaching Department, and Apply Knowledge. According to Jessica Rich, director of the FTC’s Bureau of Consumer Protection, they have been able to halt a major scam that fooled consumers to purchase useless work-at-home kits and business coaching services for millions of dollars.
The Lead Attorney for the defendants, Jonathan Hafen, had nothing to comment on Monday when the news broke out. There was a gap of a number of days before any legal action came from FTC and the Securities and Exchange Commission to respond to a request for an investigation on Herbalife (NYSE:HLF). This is a nutrition and weight loss company which has been at the forefront of accusations from several Edward Markey’s constituents. The accusation is regarding some Herbalife distributors promising business coaching to get rich quickly.
Going back to Jessica Rich’s viewpoint on the scam, she was very clear about the fact that protecting consumers from such vicious schemes of fraud companies is a top priority. A preliminary injunction is being scheduled for the hearing of the case on March 20. It will be a warning for businesses to check their actions and not commit any kind of fraud with their consumers.