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FTC, DOJ crack down on money-making schemes

Grant Gross | March 2, 2011
A yearlong sweep targeting bogus employment and money-making schemes has resulted in more than 90 law enforcement and civil actions, including a restraining order against a company that made $40 million by promising customers it would help them build Web-based businesses, U.S. agencies announced Wed

Tom Bernard, who was laid off from his job in 2009, said he responded to an e-mail from Ivy Capital in June 2009. After paying more than $6,800 for the company's services, Ivy persuaded him to pay an additional $5,600 for business credit services, he said at the press conference. "I felt this was a way to tide me over," said Bernard, now living in California.

Ivy told him he could get a business loan for the startup funding, but Ivy put all the fees on his credit card, Bernard said. When he tried to cancel the services, Ivy resisted, eventually offering him $400 for full refund, he said.

The FTC also announced that it has filed a complaint in U.S. District Court for the Northern District of Illinois, Eastern Division against National Sales Group, I Life Marketing and two other defendants, who allegedly advertised nonexistent sales jobs with good pay and benefits on CareerBuilder.com and other online job boards.

The companies' telemarketers falsely told consumers the company recruited for Fortune 1000 employers, the FTC said.

The defendants charged fees they said covered background checks and other services, but often overcharged by billing $97 to customers who had agreed to pay $29 or $38, the agency said. The defendants also charged some customers recurring fees of $13.71 or more per month without their consent.

The operation has generated more than 17,000 complaints to law enforcement agencies, online forums and job boards, and took $8 million from consumers, the FTC said. CareerBuilder.com dropped the company from its website due to complaints.

 

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