Maryland cracked down on 22 bogus business opportunities and work-at-home scams in 2006, Maryland Attorney General J. Joseph Curran Jr. announced Tuesday.
Maryland “will continue to aggressively enforce Maryland?s investor protection laws, including the laws designed to protect our citizens who purchase franchises and business opportunities,” Curran said in a statement.
The law enforcement actions were part of a federal and 11-state effort called Project FAL$E HOPE$ that attempted to punish people pushing bogus business opportunities.
Nationally, the crackdown includes more than 100 law enforcement actions by the Federal Trade Commission, Department of Justice, U.S. Postal Inspection Service and state law enforcement agencies.
The Maryland actions alleged that sellers violated registration requirements, misrepresented a material aspect of their franchise or business opportunity, or made unlawful earnings claims to buyers to entice them to buy a franchise or business opportunity.
In one Maryland action, the Securities division of the Maryland Attorney General?s Office issued a final order to cease and desist against Florida-based Coffee Heaven LLC and James Cummings in connection with their sale of a coffee vending machine business opportunity.
Coffee Heaven misrepresented to buyers the cost for each cup of coffee, did not register the business opportunity as required by Maryland?s Business Opportunity Act and did not give a Maryland buyer the required disclosure statement before selling him the business opportunity, according to Curran.
“Bogus business opportunities trample on Americans? dreams of financial independence,” FTC Chairman Deborah Platt Majoras said. “These scams offer only a money pit, where no matter how much time and money is invested, consumers never achieve the riches and financial freedom promised.”
Peter Keisler, assistant attorney general for the Justice Department?s Civil Division, said his department has obtained 23 fraud convictions in 2006, sentencing 25 defendants to a total of more than 160 years? imprisonment for causing more than $86 million in consumer loss.
“When the states and the federal government, civil and criminal enforcers, all work together ? sharing information, partnering resources, and coordinating our efforts ? we can make very significant progress against these unlawful businesses,” he said.
