Work-At-Home Marketer Lied To FTC About Finances, Got Caught Years Later, And Now Must Pay Nearly $30 Million
Another work-at-home entrepreneur crossed the legal online marketing Rubicon. When first sanctioned, the FTC significantly reduced his fine because he swore he couldn’t pay. But the work-at-home impresario was less than truthful about his financial state, and the FTC finally figured it out. Now, he has to give all his swag to the FTC.
Original FTC Investigation Resulted In Reduced Fine Because of ‘Inability to Pay’
In 2009, the Federal Trade Commission forced Jonathan Eborn, of “Google Money Tree,” “Google Pro” and “Google Treasure Chest,” to fork over $3.5 million in cash and assets for violating Internet marketing laws by way of a credit card scam.
The original verdict was for $26.9 million, but it was cut to less than $5 million based on financial affidavits. Eborn swore he couldn’t pay the entire $26.9 million.
If Eborn had been candid with the FTC, this work-at-home tale, of credit card scam woe, may have ended there. But, the FTC recently discovered that Eborn’s sworn financial statements – on which his fine was reduced – weren’t, as Stephan Colbert might say, “truthy.” Supposedly, the online marketer hid nearly $300,000 from authorities. As a result, the FTC reinstated the full $26.9 million judgment. Ouch.
Director of the FTC’s Bureau of Consumer Protection Jessica Rich explained:
“In determining the amount of assets a defendant must provide in settlement, the FTC often relies on a defendant’s sworn financial statements and requires the defendant to agree that any misrepresentations on those statements will trigger a much larger judgment. The court’s decision to impose the full judgment should serve as a lesson to all defendants that lying to the FTC has serious consequences.”
Cramming Guy Pled Guilty; Has To Hand Over Toys & Cash To FTC
So-called “cramming scams” are an illegal – but undeniably lucrative – swindle. So tempting are the potential riches that many people cross the legal line. But remember: if you get caught, the FTC can and WILL take your stuff.
This past week, the FTC announced a recent bust of a cramming scheme, involving text messages, which deceptively charged customers $9.99 a month. The original judgment was for a whopping $97 million. Like in the majority of these types of online marketing cases, however, the fine was reduced to $1.2 million in cash and assets on account of the busted party’s “inability to pay.” The crammer did have to hand over:
- The $4,500 in his bank accounts;
- A 2012 Ferrari 458 Italia and a 2012 Mercedes G550 SUV;
- Startup Shares;
- Three Audemars watches, one Patek Phillippe watch and four Rolex watches.
FTC Busted Another False Weight Loss Website Marketer
Straight up: the commissioners do not want you promising weight loss miracle cures.
If you are an online marketer peddling weight loss products, do yourself a favor and spend the couple of hundred dollars it will cost to have a website audit done by an online marketing attorney. It could save you a whole lot of money and headaches.
FTC Busted Another Credit Card / Government Grants Operation
The FTC sniffed out another illegal credit card processing scam. Say what you will about the Federal Trade Commission, but the office is getting better at spotting and tackling operations that defy the Dot Com Disclosures and the Federal Trade Commission Act.
Again, if you are running an online business that involves marketing products or services, find an online business attorney to review your advertising materials – and internal operations – to make sure you’re walking on the correct side of the legal line and not unnecessarily exposing yourself or personal finances.
Speak With an FTC Lawyer Today
If you need a legal audit of your website or online business, contact Aaron Kelly of Kelly / Warner Law.
About Kelly / Warner Law
A boutique law firm comprised of tech-heads, gear-heads, programmers and comic book junkies — who also happen to be detail-obsessed FTC defense lawyers – Kelly / Warner is the perfect fit for pioneering people doing business in the 21st century.
Contact us today to start the conversation.