Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Recovery service settles FTC charges for sale of allegedly worthless do-it-yourself kits, (Nov 20, 2013)

By Tobias J. Gillett, J.D., LL.M.

An operation that allegedly offered worthless tools for consumers to recover money lost in previous business opportunity and work-at-home scams and its principal will be barred from offering recovery services under the terms of a default judgment and a stipulated final judgment and order entered by the federal district court in Phoenix (U.S. v. Business Recovery Services, LLC, FTC File No. 1123009, Case No. 2-11-cv-00390-JAT).

According to the FTC’s complaint against Business Recovery Services LLC and its principal, Brian Hessler, the operation would make telemarketing calls to consumers and receive calls from consumers that saw the operation’s website. The calls and website advertised “do-it-yourself recovery kits” that consumers could purportedly use to recover a substantial portion of the money they spent on third party business opportunity and work-at-home ventures. The operation allegedly sold hundreds of different variations of the kits targeted at victims of various scams that were offered for prices ranging from $99 to $499.

The complaint alleged that the defendants violated the FTC’s Telemarketing Sales Rule by charging fees in advance of providing a recovery service and by making misrepresentations regarding material characteristics of the goods and services they offered. The complaint also asserted that the defendants violated the FTC Act by making false and unsubstantiated representations regarding the likelihood of obtaining a successful recovery using the kits.

The stipulated final injunction and order against Hessler permanently barred him from selling business recovery goods and services, from making any material misrepresentations regarding any goods or services, and from using any customer information obtained through the operation or failing to properly dispose of the information. The order also imposes a $5,283,658 judgment that will be suspended except for $90,000 due to his inability to pay. The judgment will immediately come due in full if he is found to have misrepresented his financial condition. A default judgment against Business Recovery Services imposes similar terms on the corporate entity.

Companies: Business Recovery Services LLC

News: ConsumerProtection FederalTradeCommissionNews