A federal district judge has ordered a business opportunity company and its president to pay more than $25 million in refunds to consumers who were conned with bogus claims that they could earn substantial income working at home. In granting the FTC’s motion for summary judgment, the court found that more than 99.8 percent of the 110,000 consumers affected by the scheme earned no money.

The Department of Justice brought the case on the FTC’s behalf in 2012 as part of “Operation Lost Opportunity,” an effort by the Consumer Protection Working Group of the Financial Fraud Enforcement Task Force to stop scams falsely promising jobs and opportunities to be your own boss to unemployed or underemployed consumers.

“The court’s order shows there are serious consequences for business opportunity marketers who invent earnings claims and fabricate stories about eager customers,” said Jessica Rich, Director of the FTC’s Bureau of Consumer Protection. “As long as scammers keep making false claims, we’ll be working with our law enforcement partners to stop them.”

The court found that the Zaken Corp. and Tiran Zaken violated the FTC Act and the FTC’s Business Opportunity Rule, which requires business opportunity sellers to provide specific information to help consumers evaluate a business opportunity. The defendants had claimed that, for a fee of $148 or more, their “QuickSell” program would help consumers find businesses with excess inventory to sell, and that they would find a buyer for the inventory and pay consumers half the sales price. They also had falsely claimed consumers would earn at least $4,000 or more in the first 30 days and, on average, $4,280 per deal.

Once consumers bought the program, they were inundated with ads to buy more business “tools” that cost hundreds or thousands of dollars. Consumers were encouraged to spend an extra $2,300 if they were serious about making money. Those who made the additional investment received only a directory of defunct companies’ telephone numbers.

On September 18, 2014, the U.S. District Court for the Central District of California permanently banned the defendants from advertising or selling work-at-home or other business opportunities and entered a $25.4 million judgment for consumer redress against them. The court issued a final order for permanent injunction on October 21, 2014.

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 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.