Misrepresentations Archives - Page 22 of 60

December 19, 2019

Lee Elbaz, the former CEO of Yukom Communications, Ltd., was sentenced to 22 years in prison following his conviction for fraud in offering and marketing a binary options scheme to U.S. investors. DOJ

Tagged in: Criminal Proceedings, Fraud in CFTC-Regulated Markets, Misrepresentations,

December 10, 2019

The University of Phoenix and its parent company, Apollo Education Group, have agreed to resolve FTC charges through a record $191 million settlement, with $50 million to be paid in cash and $141 million in debts owed by affected students to be canceled. The charges involved ads that gave prospective students the false impression that the university worked with major technology companies to design its curriculum and provide job opportunities. FTC

Tagged in: Education Fraud, Misrepresentations,

November 14, 2019

Veritaseum, Inc. and Veritaseum, LLC, together with their owner Reginald Middleton, agreed to pay $9.5 million to resolve claims of fraudulent conduct in their VERI Initial Coin Offering. Defendants were alleged to have misrepresented the potential profitability and viability of Veritaseum's purported operations, the use of funds raised in the VERI ICO, and the amount of funds raised in the VERI ICO. Middleton was further alleged to have engaged in conduct to manipulate the price of VERI. Defendants will disgorge $7.9 million in gains, plus interest, and Middleton will pay a $1 million civil penalty. SEC

Tagged in: Cryptocurrency, Financial and Investment Fraud, Misrepresentations,

November 5, 2019

AT&T has agreed to pay $60 million to settle FTC charges of misleading customers. From 2011 until 2014, AT&T advertised and sold “unlimited” data plans to millions of smartphone customers, but despite promises of unlimited data, it allegedly “throttled,” or reduced the data speeds, for customers on these plans after as little as 2 GBs of use. At least 3.5 million customers were affected, all of whom will receive a credit or check for the refund amount owed as part of the settlement. FTC

Tagged in: Misrepresentations,

November 4, 2019

Golden California Regional Center and its principal Bethany Liou will pay over $50 million in disgorgement and interest to resolve charges of fraud in connection with their sale of interests in the GCRC Cupertino Fund, LP as securities qualifying under the EB-5 visa program. Defendants represented that investor funds would be used to finance real estate development but, in fact, Liou diverted the funds to personal use. SEC

Tagged in: Financial and Investment Fraud, Misrepresentations, Securities Fraud, Visa Fraud,

October 30, 2019

Outcome Health, the trade name for ContextMedia LLC, will pay $70 million and enter into a Non-Prosecution Agreement with the U.S. to resolve allegations that the company, which sells digital advertising to be displayed in medical offices -- its primary customers are pharmaceutical companies -- fraudulently sold advertising inventory that it did not have. To conceal this, Outcome and its executives falsified reports to customers, claiming to have delivered advertising to the contracted number of screens, and inflated patient engagement metrics. This fraudulent activity resulted in an overstatement of Outcome's reported revenue, and Outcome used those fraudulent financial statements to obtain almost $1 billion in debt and equity financing in 2015 and 2016. DOJ

Tagged in: Accounting Fraud, Criminal Proceedings, Financial and Investment Fraud, Misrepresentations,

October 29, 2019

The co-defendant of a man recently sentenced for orchestrating the largest Ponzi scheme ever charged in Maryland has been sentenced to 14 years in prison and ordered to pay at least $189 million in restitution. To facilitate the scheme to sell fake consumer debt portfolios, Jay Ledford create fake sales agreements, tax returns, and other documents to co-defendant Kevin Merrill, knowing they would be used to defraud investors. When the two were arrested in 2018 with fellow co-conspirator Cameron Jezierski, the five-year scheme had already raked in over $396 million, with only 14% actually used to purchase consumer debt portfolios. USAO MD

Tagged in: Financial and Investment Fraud, Misrepresentations, Ponzi Schemes,

October 23, 2019

Gary Frank was sentenced to 17.5 years in prison following a guilty plea on charges related to his fraudulent business scheme. Frank claimed to run a multi-million dollar company, Legal Coverage, Ltd., through which employers could offer legal services as part of their employee benefits package. Based on these misrepresentations -- in fact, the company had very little revenue -- Frank obtained over $30 million in loans from financial institutions, which he used to fund his own extravagant lifestyle. Frank was also ordered to pay restitution of $33.7 million. USAO EDPA

Tagged in: Criminal Proceedings, Financial and Investment Fraud, Misrepresentations,

October 21, 2019

Devumi, LLC and owner German Calas, Jr., have agreed to a $2.5 million judgment to settle the FTC’s first ever charges against the sale of fake indicators of social media influence, such as followers, subscribers, views, and likes. The defendants allegedly enabled customers to deceive potential clients about their social media clout by filling tens of thousands of orders for fake LinkedIn followers, Twitter followers, YouTube subscribers, and YouTube views. Due to the defendants’ inability to pay, upon payment of $250,000, the remaining monetary judgment will be suspended. FTC

Tagged in: Financial and Investment Fraud, Misrepresentations,

October 16, 2019

The FTC has settled with the marketers and sellers of two aloe vera-based supplements and imposed an $18.7 million judgment against them. Defendants NatureCity, LLC and Carl and Beth Pradelli had been charged with making unsubstantiated claims to consumers about their products, TrueAloe and AloeCran, including that the products could improve cholesterol and triglyceride levels, reduce chronic pain, and treat various diseases. FTC

Tagged in: Misrepresentations,

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