December 16, 2003
Targeting the sellers of work-at-home schemes who were taking money out of consumers pockets with their deceptive pitches, the Federal Trade Commission today announced a joint federal and state law enforcement sweep cracking down on purveyors of fraudulent envelope-stuffing business opportunities.
Stuffing is fine for turkeys and stockings, but envelope-stuffing scams deserve a lump of coal, said Howard Beales, Director of the FTCs Bureau of Consumer Protection. Consumers who have been plucked by a work-at-home program and now believe it may not be legitimate can file a complaint with the Commission.
Defendants include Financial Resources Unlimited, Supreme Mailing Services, Inc., L. Lewis & Associates and A. Joseph & Associates.
The complaint alleges that the defendants violated the FTC Act through their alleged false statements or other deceptive practices. The complaints also allege that by providing the misleading information, the defendants provided the means and instrumentalities for their customers to deceive others.
According to the complaint, since at least 2001, the defendants sold envelope-stuffing business opportunities throughout the United States, claiming that consumers could make $500 WEEKLY mailing sales brochures from home. Calling their plan a Genuine opportunity, the defendants allegedly claimed that no experience was necessary and that they would provide consumers who called the toll-free number in their classified ads all the supplies they need to earn guaranteed paychecks.
Consumers who responded to the defendants ads were connected to a recorded message that instructed them to leave their name and address. According to the FTC, consumers subsequently received a form letter stating that they could earn $550.00 to $3,000 AND MORE WEEKLY!, based on $10 for each circular they mailed.
The defendants program was organized into five different groups, each promising a higher level of income, ranging from $550 per week in Group #1 to $5,000 weekly in Group #5, with sign-up fees ranging from $55 for Group #1, to $150 (originally $300) for Group #4. Group #5 was only for home workers who started under income Group #4 and received their 5th $3,000 paycheck.
The defendants allegedly identified Group #4 as the BEST DEAL! and provided consumers with examples of how much money they could earn at each level. The FTC alleges that consumers did not make the money promised by the defendants and that defendants did not pay $10 per envelope for all or many of the envelopes stuffed and mailed by consumers, as promised. The FTC also alleges that defendants did not pay the cost of postage as they promised consumers.
Castle Publishing The FTC filed its complaint against Castle Publishing, a Texas sole proprietorship, and Treigh Dustin Hubbard, individually and as the sole owner and manager of Castle.
According to the FTC, since early 2001, the defendants marketed and sold envelope-stuffing business opportunities to consumers throughout the United States using unsolicited home mailers containing numerous false claims. Many of their customers were unemployed, disabled, or elderly consumers who hoped to earn an income working from home.
Joining the Commission in announcing its two federal district court complaints were the U.S. Postal Inspection Service, which announced five criminal and 22 civil cases; the Illinois Attorney Generals Office, which announced two state complaints; and 23 states and four other government agencies that participated in a nationwide consumer education and outreach initiative about the potential costs of such work-at-home opportunities.
Internet-savvy consumers still rely on the traditional backbone of commerce, the U.S. mail, to communicate and conduct business. Our job as Postal Inspectors is to prevent those customers from becoming victims of mail fraud, including work-at-home schemes, said Postal Inspector Molly McMinn.
Consumer Education
If youre tempted by an envelope-stuffing opportunity, there are some questions to ask the promoters before you send any money or sign up to receive more information:
- Who will pay me?
- When will I get my first paycheck?
- Will I be paid a salary or will my pay be based on commission?
- What tasks will I have to perform?
- What is the total cost of the envelope stuffing program, including supplies, equipment and membership fees? What will I get for my money?
The answers to these questions may help you determine whether an envelope-stuffing promotion is appropriate for your circumstances and legitimate. It may also help to check out the company with your local consumer protection agency, state attorney general, and the BBB in the community where the company is located, as well as the community where you live. The alert also provides information on what consumers can do if they have spent time and money on a work-at-home program and they now believe it may not be legitimate.
