August 20, 2008
Brothers Will Give Up Cash and Cars to Settle FTC Charges That Earnings Claims for Their ‘Money-Making Secrets’ Misled Consumers
Two brothers have agreed to settle Federal Trade Commission charges that they misled consumers with false earnings claims for work-at-home schemes involving free government grants, mystery shopping, online surveys, and data entry. Under the proposed settlement, they are banned from marketing work-at-home opportunities in the future.
The defendants are charged with making false and unsubstantiated earnings claims in violation of the FTC Act. According to the FTC’s complaint, they charged consumers from $47 to $129 to access their “members only” Web sites with their “money-making secrets.” Their advertised programs either did not exist as represented or did not offer quick and easy money with little time or effort as promised.
This case was brought as part of Project Fal$e Hope$, an FTC-led effort that targeted bogus business opportunities and work-at-home scams, and resulted in more than 100 law enforcement actions by the FTC, the Department of Justice, the U.S. Postal Inspection Service, and law enforcement agencies in 11 states.
The defendants are Eric G. Louie, doing business as Fastcashathome.com, Fastcashathome.homestead.com, and Hometypers.com; and Calvin G. Louie, doing business as Moneymakingsecret.homestead.com, Realcashprograms.com, and Dataentrypro.com. Under the proposed settlement, they are banned from selling work-at-home opportunities, and, in marketing any other product or service they, are barred from making false, misleading, or unsubstantiated representations, including:
* that consumers are likely to earn a substantial amount of money or other valuable compensation;
* the amount of earnings, income, sales volume, or profits that a consumer is likely to achieve, or that others have achieved;
* how long it may or will take to recoup the purchase price or investment;
* the nature of any business venture offered or sold;
* any material term, condition, or limitation of the transaction; and
* concerning the use of any offered good or service.
The settlement imposes a $4.9 million judgment that will be suspended if the defendants surrender assets frozen by the court in 2006; proceeds from the sale of two cars, a Lamborghini and a Ferrari; and any tax refunds for tax years 2005 and 2006. The full judgment will be imposed if they fail to meet the terms of the settlement, or if they are found to have misrepresented their financial condition. The settlement also contains standard record-keeping provisions to allow the FTC to monitor compliance with its order.
The Commission vote to file the proposed stipulated final order was 4-0. It was filed in the U.S. District Court for the Central District of California.
NOTE: This stipulated final order is for settlement purposes only and does not constitute an admission by the defendant of a law violation. A stipulated final order requires approval by the court and has the force of law when signed by the judge.
The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC's online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,500 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC's Web site provides free information on a variety of consumer topics.
Office of Public Affairs
FTC’s Northwest Region
(Money Making Secret)
(FTC File No. X070024)