Scammers who duped consumers into paying more than $30 million for bogus business opportunities have settled Federal Trade Commission (FTC) charges that their deceptive claims violated federal law.
The settlements prohibit future violations by the defendants, who promised consumers that they would receive access to overstocked merchandise, expert training in the surplus goods industry, and substantial income.
Among those who settled with the FTC are Sheldon and Judith Takala Fidler and nine companies they controlled: World Traders Association, Inc., United Traders Association, Inc., International Merchandise Group, Inc., Trans-Global Connections, Inc., Musketeer Partners, Inc., Fulfillment Options, Inc., International Associates Worldwide, Inc., Magna Delta, LLC, and Office Options, LLC.
The FTC filed suit in February 2005 as part of "Project Biz Opp Flop," a crackdown on deceptive business opportunity and work-at-home schemes. The settlements entered last April ban the defendants from the business opportunity and franchise industries and prohibit them from misrepresenting any goods or services.
The settlement orders also bar the defendants from selling or otherwise benefiting from personal information about customers who paid them before the orders were entered. In addition, the orders impose a $30.7 million judgment, which is suspended based on the defendants' inability to pay.
In March 2007, in a related criminal proceeding instituted by the United States Attorneys Office for the Central District of California, Sheldon Fidler pleaded guilty to two counts of mail fraud and received a 60-month prison sentence; he is currently in jail. Judith Fidler pleaded guilty to one count of criminal contempt and received two years of probation.