Feds, states announce major action against scams with 'hundreds of thousands' of victims

scamTargeting scams that prey on people vulnerable because of the down economy, federal and state officials announced today a laundry list of legal actions including a lawsuit against a collection of get rich quick schemes that lured "hundreds of thousands" of victims who paid out about $300 million.

The companies allegedly jointly operating the schemes, including John Beck's Amazing Profits and Mentoring of America, marketed them heavily through television infomercials. They sold guides to their supposed systems of quick paths to wealth for $39.95 and charged an additional $39.95 a month after that.
"These promises deliver nothing," said David Vladeck, who heads the Federal Trade Commission's Bureau of Consumer Protection at a press conference this afternoon. "It was the scammers who made the big bucks."

An email sent to John Beck was not immediately answered.

Vladeck urged consumers to exercise skepticism when being offered any kind of deal that promises to deliver quick cash.

"Why would someone share a secret with a perfect stranger when they could spend the time making the money themselves?" Vladeck said.

The FTC even released a video that features a convicted former business opportunity scammer explaining how he took advantage of people.



In addition the FTC announced seven other new legal actions as well as dozens undertaken by 13 states and the District of Columbia since January -- all part of "Operation Short Change." The FTC said it already won temporary restraining orders and had the subjects' assets frozen in six of the new cases.

Other lawsuits announced are against (Note: many of the targeted entities operated under numerous names):

  • Wagner Ramos Borges, who operated companies including "Job Safety USA," which allegedly tricked job applicants into paying a fee for a made up credential to work maintenance and cleaning jobs.
  • Grants For You Now, which promised access to government grants for a $1.99 fee that led to an undisclosed charge of up to $95 a month.
  • Cash Grant Institute, which used robocalls to solicit people to participate in its grant-finding program.
  • Mutual Consolidated Savings, which hawked the "Rapid Debt Reduction" plan.
  • Google Money Tree, which allegedly duped people into believing they could make $100,000 in six months selling Google ads, but instead charged participants $72 a month.
  • Penbrook Productions, an alleged scheme that got people to pay $197 to become high-paid "certified rebate processors."
  • Classic Closeouts, which allegedly kept charging customers who bought low-cost household items or clothing from the firm's web site.
The FTC is offering a collection of tips and educational materials to help consumers learn more about scams so they can avoid becoming victims.

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