By Jon Hood
ConsumerAffairs.com
October 13, 2009
Minnesota Attorney General Lori Swanson has filed suit against the Arthur Group, a supposed employment agency that promised struggling consumers it could help them find work. Instead, Swanson says, the headhunter swindled workers out of thousands of dollars apiece by touting non-existent connections and playing up its ability to help customers land quality interviews in a tough job market.
According to Swanson's complaint, the Arthur Group charged customers up to $4,500 each for its impressive-sounding fast and efficient service to over 900 corporate partners. The agency promised access to a hidden job market, and ostensibly used the payments to update customers' resumes and help them bolster their interviewing skills.
Customers received none of the benefits they were promised; instead, Swanson says the group engaged in a classic bait-and-switch scheme.
The company posted ads for open positions on sites like CareerBuilder.com, which featured in-depth job descriptions and salary ranges but, curiously, never mentioned the employer's name. Those interested were told to submit their resumes directly to the Arthur Group. Crestfallen consumers were later informed that the job was no longer available.
In some cases, listings offered by the company attached links that turned out to be inactive. Swanson's office is currently investigating whether the agency completely fabricated those positions, or whether they were advertising a real job that wasn't actually available.
Adding insult to injury, consumers were told not to worry about the program's high cost, as they would be reimbursed as soon as they were hired by one of the group's corporate partners.
A press release issued by Swanson slammed the company for targeting vulnerable consumers during an economic downturn. With our unemployment rates at record-high levels, many people are out of work and looking for jobs, the release reads. It is unconscionable for a company to take advantage of peoples understandable trepidation about being out of work by charging them hefty fees but giving them little help.
The suit names as codefendant the company's CEO, Barry Trimble, who apparently realized he was in trouble before the action was filed. The Arthur Group shut down its website and closed its office in August, a day after a New York Times piece first uncovered the company's alleged fraud.
That article detailed the plight of several out-of-work consumers defrauded by the company, and confirmed through former Arthur Group employees that the agency rarely found jobs for anyone. Those employees also said that, despite its grandiose claims, the agency has no special relationships with employers. Trimble responded that clients who failed to reap the benefits offered by his agency are nutburgers.
Swanson's suit seeks an injunction, reimbursement, and civil penalties for violation of Minnesota consumer protection laws.
Swanson has been burnishing her credentials as a consumer watchdog since her 2006 election. She recently filed suit against Consumer Health Benefits Association and Home Health America, which offer medical discount cards disguised as bona fide insurance plans. In August, she sued a Minnesota chiropractic clinic that signed patients up for health care credit cards without first obtaining their permission.