Texas Attorney General Greg Abbott has won a temporary restraining order and asset freeze against Texas-based BioPerformance Inc. The company, allegedly organized as an illegal pyramid scheme, markets a fuel pill it claims will boost gas mileage and save consumers money.
BioPerformance Inc., president and owner Lowell Mims and co-owner Gustavo Romero of Irving advertise nationally via the Internet and through seminars around Texas and other states, exploiting the climate of today's high fuel prices.
The company's ads claim the gasoline pills and powders they offer have a non-toxic "top secret gas pill" that can increase fuel efficiency by 30 percent or more and cut harmful emissions by up to 50 percent. In fact, the additive is basically the chemical equivalent of mothballs, which are toxic.
"BioPerformance claims its top-secret gas pills can save consumers big bucks at the gas pump," said Abbott. "These claims are bogus; the pill does absolutely nothing to improve gas mileage. The company is merely a smokescreen to trigger the recruitment of more and more paying members into what appears to be an illegal pyramid scheme."
Scientists who tested the product at the University of Texas at Austin and at a Florida university concluded that the pills are mainly naphthalene, the chemical found in mothballs. The Attorney General's laboratory expert actually concluded BioPerformance's product could decrease engine performance.
Abbott's scientific expert also found that the chemical compound used in these pills can be harmful to humans. Short-term exposure to naphthalene by humans via inhalation, ingestion or skin contact can result in anemia and neurological or liver damage.
Legitimate multi-level marketing businesses pay commissions based on the sale of goods and services, while illegal pyramids, which the Attorney General alleges BioPerformance is, pay commissions based mainly on the recruitment of people to the organization.
Consumers are encouraged to become "dealers" at the various dazzling seminars BioPerformance sponsors around the country, at start-up costs of between $300 to over $500.
Members can participate at various levels of "business volume" sales, but ultimately the plan functions on the basis of how many others a member can recruit to become dealers, which is by definition a pyramid scheme. On its Web site the company boasts almost 4,500 Texas members with $25 million in sales since December.
The Attorney General's lawsuit alleges violations of the Texas Deceptive Trade Practices Act and the promotion of an illegal pyramid scheme, which can result in penalties of $20,000 per violation.
The suit requests restitution to consumers who have been financially harmed by the false promises of this operation. These false income promotions include slick Web site come-ons for new sports cars, mansions and exclusive vacations "just for helping Americans save money on gas."