Jeff Paul, John Beck, & Other Infomercials Charged by FTC July 1

[Ram]

Actually, Jeff doesn't own the company his name is on. Nor does John Beck. Nor does John Alexander.

Gary Hewitt and Doug Gravink own them. They own Family Products LLC which owns Mentoring of America LLC and all the LLCs tied to Jeff, and the two Johns.

Jeff Paul, John Alexander and John Beck have a deal with Family Products to do all the marketing where they license their name and products and appear in the infomercials, etc. They get paid, but they don't actually own any of those companies. They are front companies for Family Products.

Hewitt and Gravink have been in this game for years.

BTW - this type of deal is common. Guess who owns Dean Graziosi's marketing arm? And who used to own Russ Dalbey's before he got too big?

Any guesses?

Don Lapre.

[bobsedge]

The FTC doesn't really care about corporate structure. They will pierce any corporate veil.

I honestly do not believe that there is a tipping point in these type of cases. They target an industry and then decide who will be made an example of. They want someone that can make headlines and has deep enough pockets so they, their lawyers, and forensic accountants can take fees. The irony is that there is rarely much money left to go back to the customers.

I predict that they will hit the IM industry and take down someone large within two years. They went after Jeff Paul as part of the biz-op industry, but the investigation of him could likely open their eyes to the IM industry.

[Steven Carl Kelly]

Originally Posted by adamv

Can they see over the handlebars of the Segways? Maybe they have to stand on a couple of phone books.

Yeah, the could see over the handlebars. BTW, just an FYI: John Rice died a couple of years back.

[Lyn Woodring]

I have learned the hard way to deal with undiscloused forced contunity. I use a debit card that I use just for untried or dubious offers. That way if its some type of fraud I just cancel that card and have a new one issued.
This card has very little money in it and I transfer money to it as needed. Since its not used for regular transactions canceling the card creates nor problems. Since the money in it is minimal any loss is also limited.

[60MinuteAffiliate]

This is all very interesting. I ended up buying a dog food ebook the other day and after i had made my purchase was told that I was now a member of their dog club which meant that instead of being charged so many dollars a month i got it a few dollars cheaper.

colleen

[adamv]

Originally Posted by Steven Carl Kelly

Yeah, the could see over the handlebars. BTW, just an FYI: John Rice died a couple of years back.

Really??? I had not heard about that. That's too bad.

I guess that's why it's been a while since I've seen those infomercials.

[Ram]

John and Greg Rice filmed that infomercial in 1998. It wasn't their product, they were just the personalities. It was for Ron LeGrand's "Cash Flow Generator." It still runs today in selected markets.

[Jon Steel]

Wow - that sucks. Thank for the links. I have to keep up with the world around me...

js

[seasoned]

Originally Posted by ahlexis

An interesting reason to use prepaid Visa and Mastercard gift cards . . . unexpected forced continuity!

And just think, there are congressmen/women who would like to do away with them! (Your tax dollars at work.)

Unexpected forced continuity IS illegal! It was even when I was a little kid! They just don't enforce it. Basically, costs are supposed to be revealed BEFORE the sale! Heck, some BIG software companies tried about a decade ago to have enclosed licenses. Even though most of the license did not encumber use and was customary, it was STILL found to be illegal! They basically had the customer entering into a contract without revealing details, and that made it VOID!

Steve

[seasoned]

Originally Posted by Josh Anderson

...
And yes though the forum changes the word... goober is pretty accurate description ;-)

I was beginning to think I was the only one that viewed it that way. Goober has the connotation of not being very bright. In the Andy Taylor universe, Goober was nice, but not very bright.
Urban Dictionary: goober

Goober Pyle - Wikipedia, the free encyclopedia

Goober was Mayberry's "village idiot". This was perhaps best seen in an episode when Goober believed his dog was talking human, which then filled his head with delusions of becoming rich and famous. In reality the "talking dog" was a practical joke played by Opie and his friend, who had hidden a walkie-talkie under the dog's collar and pretended to be the dog's voice. He was a childlike and somewhat dimwitted character, similar to his cousin Gomer, although not as extreme. Both Goober and Gomer were the show's comic relief.

Oh well....You are right in your implication....G-U-R-U is SO overused that goober IS a better term. It is more meaningful! ROTFLMAOFE

[jcaviani]

My only question is - what took so long? There are many in this realm that have been pushing the legal line and crossing it for many years without consequence. Too many people have offered feeble, brazen justifications for their fraudulent money making schemes for far too long. Much of what has been heralded as great marketing in portions of this forum is simply fraud.

I hope this crackdown is only the beginning. I also hope the offenders get more than a slap on the wrist and their bank accounts are drained to fumes. Unfortunately, something tells me these guys will find God, offer fake apologies (maybe even shed a few tears for effect) and be back working some other angle under the guise of helping people in the near future.

[WayneBuckhanan]

Originally Posted by Don Schenk

I know a particular IMer who offers a coaching system after getting would-be newcomers into a continuation. He has "qualifier" sales people call to see if the person paying into the continuity would have money to put into coaching. He then has "closers" call the customer and try to sell a coaching system that ranges from about $3,000 to as much as $9,000.

Sounds like what I got put through by one of the loud, energetic Goobers.

I went through their 12 step hard-sell process and was charged $3500 for the promise of bootstrapping a "done for me" business. Instead I got a web page design and lots of glad handing "yes, looks good, keep going" reassurances from the "coaches." I went through several "coaches" because the first guy disappeared while I waited patiently for replies to my emails...

I was told I was going to learn how they did market research, wrote copy, etc. by "looking over the shoulder of their experts" and that is what I bought. Instead I got a couple draft quality ebooks on writing articles -- but only after months of non-coaching and making my way up the chain to the manager (who was the Goober's brother!) and asking for a refund (which I never got). The irony is that I would have gotten a better design, better information, and better support with $100 and a few hours here on WF.

I guess I should be glad it wasn't forced continuity also!

In spite of all that I don't know that I would prefer the FTC involved. I suppose not everyone can write it off as a learning experience and so some amount of gov't involvement may be more helpful than harmful in this case. *I* knew better and chose to ignore my gut and attempted to pay for the "short cut" and instead lost time, money, and energy.

I still subscribe to the classics:
Caveat emptor.

[Lance K]

Originally Posted by FlightGuy

Last night I stayed up a bit and caught Jeff Paul's "Shortcuts to Internet Millions" infomercial.

I just don't understand how peoples red flags don't go up after seeing nothing but sexy babes...

So you watched it and you still choose to use the description "sexy babes"?

I just threw up in my mouth.

[Vector]

That's really FUNNY!

"So, for the next 25 years Steve will be in prison getting a different kind of "Natural Male Enhancement".

[Nightengale]

I'm all for treating consumers right, but I'm always suspicious of the FTC.

I have two of Joe Sugarman's books and in one of them (don't remember the title), he talked about the time when he was investigated by the FTC. He's an upright businessman and was cleared of all charges, but not before it nearly killed his business and destroyed his reputation.

I dislike and distrust infomercial snakeoil salesmen as much as the next girl, but I don't have a lot of faith in the FTC when it comes to this either. As someone else mentioned, they tend to follow a seize-and-destroy-and-THEN-investigate-charge-and-try modus operandi. And the "destroy" part of it applies to both your business AND reputation.

After working in customer service, I don't have a lot of faith in the intelligence of the general public or their ability to read and understand basic sales letters and term and conditions. Sounds horrible, I know, but try working in a call center for a few years. :\. I never had this perception of the general public until I worked in customer service and I hate how I little I think of them these days. But that's what customer service has done for me. As someone said (was it P.T. Barnum?), "No one ever went broke underestimating the intelligence of the general public." (Or something like that.)

Michelle

[bobsedge]

Unfortunately, you are never cleared of all charged by the FTC. The settlements all read the same. There is no admission or assumption of guilt, but the terms of the settlement usually destroy lives and businesses.

That being said, I am sure that is some cases the FTC is justified in their actions. The problem is that they are lazy and sloppy and act on industries instead of businesses. They will trump up charges that are full of lies and half-truths and they really go for blood.

They always settle, but the settlements vary depending on the size of the businesses. When they go after very large businesses, the settlement just involves money and they never go after the owners. When they go after the relatively small businesses (the Joe Sugarman's) the business and the person are left in shambles.

What is needed is a true non-political consumer protection agency that has no agenda and looks to get rid of the bad guys instead of an agency that cleans up industries because they are inconvenient or problematic to another established industry.

[Adam Bshero]

Just a quick question.

How does this FTC case with Jeff Paul and the rest differ than say some IM gurus?

What are they doing to not be attacked by the FTC? Earnings Disclaimer?

[bobsedge]

The IM industry has simply just not hit the radar yet. But it will and then a high profile IM'er or two or three will be taken down. And they don't have a chance because they break every rule in the FTC book.

[Floyd Fisher]

Originally Posted by Ram

Actually, Jeff doesn't own the company his name is on. Nor does John Beck. Nor does John Alexander.

Gary Hewitt and Doug Gravink own them. They own Family Products LLC which owns Mentoring of America LLC and all the LLCs tied to Jeff, and the two Johns.

Jeff Paul, John Alexander and John Beck have a deal with Family Products to do all the marketing where they license their name and products and appear in the infomercials, etc. They get paid, but they don't actually own any of those companies. They are front companies for Family Products.

Hewitt and Gravink have been in this game for years.

BTW - this type of deal is common. Guess who owns Dean Graziosi's marketing arm? And who used to own Russ Dalbey's before he got too big?

Any guesses?

Don Lapre.

It doesn't matter where the Government is concerned.

If you're pimping a scam, you're just as bad as the scammers themselves. It does not matter if you knew it was a scam or not, because you should have known better.

Basically, it comes down to 'ignorance of the law is no excuse'.

[jercarbra]

Originally Posted by JerryIL

Never met or heard of anyone who made any money from the infomercials..

Well, let's see... the infomercial producer made money by filming and producing the show... the cable stations made money by selling air time... the actors made money by giving fake testimonials... companies made money by publishing the booklets, and/or copying cd's, dvd's, etc... telemarketers made money by upselling you... and oh, I almost forgot... the promoter himself or herself also made a little money... to the tune of millions! So quite a few people DID make money from these infomericlas... unfortunately... NONE of us did!

Jerry

[Don Schenk]

Originally Posted by bobsedge

They always settle, but the settlements vary depending on the size of the businesses. When they go after very large businesses, the settlement just involves money and they never go after the owners. When they go after the relatively small businesses (the Joe Sugarman's) the business and the person are left in shambles.

The FTC went after Frank Kern a few years ago. It cost him a few hundred thousand dollars and a bunch of sleepless nights, but he came out of it wiser and more successful.

Originally Posted by WayneBuckhanan

Sounds like what I got put through by one of the loud, energetic Goobers.

I went through their 12 step hard-sell process and was charged $3500 for the promise of bootstrapping a "done for me" business. Instead I got a web page design and lots of glad handing "yes, looks good, keep going" reassurances from the "coaches." I went through several "coaches" because the first guy disappeared while I waited patiently for replies to my emails...

Caveat emptor.

Yep Wayne, it sound sooooo familiar, but I was lucky I didn't give them any money.


:-Don

[Sam Smith]

Originally Posted by Jeremy Kelsall

I didn't really think the continuity was really hidden with a lot of these offers so, it would suck if the continuity was the cause...

If that was it, basically a bunch of people are getting picked up because people ordering products online are too illiterate to actually read the terms and conditions.

Woah there Jeremy.

Hiding something in the small print = not having it there at all.

Who honestly reads those things? A 22 page contract to buy a mobile phone, a marketing DVD, every computer programme. (Even sometimes to use a website).

This is NOT the consumer's fault, and definitely doesn't make them "illiterate".


Deliberately hiding stuff where they know customers will skim, for that exact reason = scam.

Customers should be fully aware 100% of the time of charges they're paying.

[Bill Jeffels]

Originally Posted by Ram

Actually, Jeff doesn't own the company his name is on. Nor does John Beck. Nor does John Alexander.

Gary Hewitt and Doug Gravink own them. They own Family Products LLC which owns Mentoring of America LLC and all the LLCs tied to Jeff, and the two Johns.

Jeff Paul, John Alexander and John Beck have a deal with Family Products to do all the marketing where they license their name and products and appear in the infomercials, etc. They get paid, but they don't actually own any of those companies. They are front companies for Family Products.

Hewitt and Gravink have been in this game for years.

BTW - this type of deal is common. Guess who owns Dean Graziosi's marketing arm? And who used to own Russ Dalbey's before he got too big?

Any guesses?

Don Lapre.

Ha, that's so funny about the Don Lapre, Dean Graziosi's connection.

I always thought they were similiar. If you just took out Dean's Motoring Millions and inserted Don's "tiny classified ad's" and took out don's nazzley voice.

It's interesting I got a e-mail from Yanik silver advising of... Yanik, Joe Polish, Dean Graziosi's and Richard Branson all hanging out on Branson's Necker Island.

It's surprising that Yanik would be hanging with the types of Dean Graziosi, bacause Yanik alway's wants to have the image of a trustworthy guy.

Regards

Bill Jeffels

P.S., if you want, google... Allman Glenn Braswell, that will keep you reading about fraud for a while.

[Alan Petersen]

It's these guys that give us all a bad name. I'm glad they're getting a thumping but I do agree though that Jeff Paul and these other crooks are just chum in the water for the FTC. It's open season on business now and the good ones will also be caught in the feeding frenzy.

But I'm upset at the Jeff Paul's out there than the FTC.

[Loren Woirhaye]

Originally Posted by Nightengale

I'm all for treating consumers right, but I'm always suspicious of the FTC.

I have two of Joe Sugarman's books and in one of them (don't remember the title), he talked about the time when he was investigated by the FTC. He's an upright businessman and was cleared of all charges, but not before it nearly killed his business and destroyed his reputation.

I dislike and distrust infomercial snakeoil salesmen as much as the next girl, but I don't have a lot of faith in the FTC when it comes to this either. As someone else mentioned, they tend to follow a seize-and-destroy-and-THEN-investigate-charge-and-try modus operandi. And the "destroy" part of it applies to both your business AND reputation.

After working in customer service, I don't have a lot of faith in the intelligence of the general public or their ability to read and understand basic sales letters and term and conditions. Sounds horrible, I know, but try working in a call center for a few years. :. I never had this perception of the general public until I worked in customer service and I hate how I little I think of them these days. But that's what customer service has done for me. As someone said (was it P.T. Barnum?), "No one ever went broke underestimating the intelligence of the general public." (Or something like that.)

Michelle

Ben Suarez was also railroaded by the FTC. When a direct mail company
gets to be a certain size it seems it becomes a target for ambitious mid-level
bureaucrats looking to put some notches on their guns.

The direct marketing and mail industry lobbies heavily to protect freedoms
we enjoy as small-time marketers.

It's interesting how closely Suarez's story mirrors Sugarman's.

That being said, it sure sounds like this latest Jeff Paul operation is
pretty sleazy.

[BrianMcLeod]

Some of these spots were so over the top they were virtually BEGGING for an action like this... Incredibly poor decision making from people who should know better.

But it will inevitably happen again... once a certain critical mass takes hold with a DRTV spot, deeply discounted and per inquiry avails have a way of making danger seem smart. We're seeing the same money-intoxicant at work in the CPA world...

Funny how that parallels, isn't it? Oversold/deceptive offer, per action customer acquisition model, scale happens.

My takeaway from reading the complaint: It's not a very good time to be a phone room in the back-end coaching business. Not when you behave like some of those reckless idiots in some of those operations behave.

THAT is what sunk these guys, not their woeful boobs and biz opp spots. A spot like that doesn't generate the complaints and the heat. It's the assclown hammering the FTC investigator with a hard close for $10k on tape... yep, that'll do it.

There's no plausible excuse for what some of these guys do, I've heard the tapes (no, not THESE tapes).

Brian

[Floyd Fisher]

Originally Posted by NathanFalkner

Floyd (or anyone), just wondering... does this extend to the
television stations that accepted the "Jeff Paul" type of ads? Do
they get to keep all that money they were paid to air these
apparently fraudulent advertisements?

I don't really follow this type of thing too closely, but maybe
you'd know. Have any TV station owners been jailed or fined in
the past?

Unfortunately, the TV stations get to keep the ad revenue.

Would be a good idea to lump them in too with fines for advertising stuff like this. Maybe they wouldn't be so quick to fill their dead time with scams.

But then again, it would just drive their costs through the roof because they would have to screen each and every ad prior to broadcasting, which could be a nightmare for them.

[dhiggins]

I am really suprised that the well known Goober, who used to be or maybe still is an attorney, would have even put himself in the position of being accociated with Jeff Paul on national T.V., especially when such blatent lies (excuse me), exagerations of the truth, are being told.

One of the products that he markets is supposed to keep you from getting in trouble with the FTC. He came out with that product right after Frank Kern got whipped by them.

I guess Jeff Paul didn't bother to purchased it from him....

[dhiggins]

It would be my opinion that if you are going to have a business model of a continuity program, paid monthly membership, that it would be wise to send out an invoice two weeks ahead of time to the member to remind them that they will be remitting a payment in two weeks.

Then send another one a week before, then one on the day the payment is due. That way there is no way that there is any mis-understanding between the parties involved.

I think however, that the best way is, if the customer wants to remain a member and continue to receive the benifits or products, you should send out the reminder invoices and then he or she should have to remit payment manually and not have an auto payment setup.

Just my opinion
Dan

[Carl Pruitt]

More government - of any sort - is always a bad answer to any problem.

More people get taken advantage of because they naively assume that the government can protect them from con artists than could possibly be ripped off if most of these alphabetically titled government bureaucracies never existed and people knew from the get go that big brother would never be there to protect them.

One possible good use of these alphabet agencies might now be to take the customer lists from the businesses listed in this FTC action and hand it over to the FEC and local voter registration boards so we can have those people removed from the voter rolls.

[goalpower]

I used to sell coaching programs out of an office in Kansas City for many of these info gurus.

Got sick of it after about 2 months - didn't like how they were ripping people off. They sell ****ty coaching programs that really don't teach people much, and some get hit for 2k - others for 15k - and there's not much difference in the coaching for the price variation.

It's a bad deal. Our parent office in Utah was selling over 100k in coaching every week.

What comes around - goes around.

[Shaka]

From the sounds of what these people were doing I am glad the FTC stepped in. And in the case of Jeff Paul, I wonder what took them so long.

[jgand]

Yeah, these on tv infomercials are subject to investigation on a regular basis it just takes a few complaints to get the ball rolling for an investigation, they will probably be in litigation for years and have to pay a fine.

[actionplanbiz]

DId Carlton sheets have the Same Problem? What was the Out come of that?

...Still Rich Right?

[bobwalk]

These Infomercials are great examples of what not to do. Sooner or later the FTC start
looking deep into your business practices.

[Avidpoet]

Seen an infomercial where two big breasted(one blonde one dark haired)women were sitting on a couch lol the blond was like. "Like oh my gawad I just made a sale" I dam near pissed my pants laughing lmaoooooooo.

I forget which infomercial it was for but they dont play it anymore but it was hilarious.

[mywebwork]

Originally Posted by Avidpoet

Seen an infomercial where two big breasted(one blonde one dark haired)women were sitting on a couch lol the blond was like. "Like oh my gawad I just made a sale" I dam near pissed my pants laughing lmaoooooooo.

I forget which infomercial it was for but they dont play it anymore but it was hilarious.

Actually that was Jeff's first commercial for the same product - his "Shortcut to Internet Millions". Obviously Jeff has a cleavage fixation!

Confession - I'm a workaholic who takes a break around midnight to watch Star Trek Voyager, so the only TV I'm familiar with is primarily infomercials as that's all that's on after 1 AM!

Question - If the FTC clamped down on Jeff's commercials then why do they still run? They are still on 5 times every evening in our market.

Bill

[Mike Hill]

I read somewhere today (sorry can't remember where I read it) that the FTC is no longer chasing people, they are simply handing over the claims marketers make in their advertising to the IRS and letting them deal with it...

Tax evasion is a serious thing and far worse that the FTC jumpin' on ya. At least that's what I've seen from the history of the IRS.

Mike Hill

[enterpryzman]

Infomercials ALL make money, what they sell most often does not. This form of selling is now moving to local main-stream brick and morter companies.

Enterpryzman

[dmail333]

I made money with John Alexander's system [before TV I paid $997] and I could have made money with John Becks. I was just impatient. It takes 6 mouths to a year to get total control of the houses. Just like people buy Guru's products an WSOs and don't do anything the same goes for "the good TV products" But on TV you have 1000 times more people failing. And the Feds hate Biz Opps.

I made as much as 56k in one month following what Brad Richdale course. You don't have to buy all the upsells though... that's what you have to watch out for.

I've bought lots of TV products [non Biz Opp] that have been great... and very few are weak.

[anthony2]

Jeff Paul always seem too be a honest marketer to me.
I been following him for a long time now.
When i still don't think he is a bad guy just one who made
the wrong choice.
When i seen his informical the big mistake he makes is by
guaranteeing someone will make money. Which is a big NO NO.

But overall i don't think he is some bad guy.

[anthony2]

Originally Posted by Avidpoet

Seen an infomercial where two big breasted(one blonde one dark haired)women were sitting on a couch lol the blond was like. "Like oh my gawad I just made a sale" I dam near pissed my pants laughing lmaoooooooo.

I forget which infomercial it was for but they dont play it anymore but it was hilarious.

Yea i remember that commercial....With the two fake breasted bimbos.

I have to agree that commercial was hilarious.

[Adam G. Katz]

Originally Posted by Sam Smith

Woah there Jeremy.

Hiding something in the small print = not having it there at all.

Who honestly reads those things? A 22 page contract to buy a mobile phone, a marketing DVD, every computer programme. (Even sometimes to use a website).

This is NOT the consumer's fault, and definitely doesn't make them "illiterate".


Deliberately hiding stuff where they know customers will skim, for that exact reason = scam.

Customers should be fully aware 100% of the time of charges they're paying.

Hi, Sam.

I respectfully disagree. And so do the courts.

Have you ever parked in an underground parking garage and received the time-stamp ticket as you drive in? Ever look at the back of the ticket?

Have you ever purchased a house in the U.S. and read (and understood?) every word of every page on the contract and accompanying disclaimers -- including the HOA? What about the civic laws pertaining to property ownership in your town?

Small print is endemic to living in a country the operates under the rule of law.

I think that the real issue here is that the "small print" wasn't (allegedly) offered to the customer, pre-sale.

[JohnB23]

On the topic of scams, have you seen this video (spoof). Pretty funny, of Don Lapre, hahahaha.

(warning, a little bit of offensive language at :30-:42)

YouTube - Dom Wupwabe's Magical Money Geyser...

Don Wupwabe's Magical Money Geyser System.

This guy nails it.

[igrowyourbiz]

Originally Posted by Adam Bshero

Just a quick question.

1) How does this FTC case with Jeff Paul and the rest differ than say some IM gurus?

2) What are they doing to not be attacked by the FTC? Earnings Disclaimer?

1) It doesn't

2) Not enough complaints

...yet



i could think of some names though