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Wednesday, February 26, 2014

FTC Files Complaint Against Apply Knowledge, YES International

The FTC announced on Monday that it has filed a complaint against Apply Knowledge, a work-from-home business opportunity that "conned millions of dollars from consumers by falsely telling them they could easily earn thousands of dollars a month by purchasing bogus business coaching services and establishing their own Internet businesses." The FTC noted that consumers who purchased the company's "product(s)" lost thousands if not tens of thousands of dollars.

From the FTC Press Release: "U.S. District Court for the District of Utah froze the assets of the defendants, who did business under a variety of names, including Essent Media, LLC, Net Training, LLC, YES International, Coaching Department, and Apply Knowledge, and appointed a temporary receiver to take control of the operations, pending the outcome of a preliminary injunction hearing set for March 20, 2014. The FTC seeks to put a permanent stop to the operations and return money to consumers."

According to the FTC’s complaint, the defendants’ websites told numerous false “rags to riches” stories, using photos – obtained from stock photo agencies – of supposed users of the defendants’ services, and made false and unsubstantiated claims about how much money consumers could earn.

ERSP had previously examined the advertising claims made by defendant YES International, pursuant to an anonymous consumer challenge (ERSP Case #311). In particular, ERSP reviewed earnings and testimonial claims that appeared on a variety of different lead-generation websites.

In examining the sites, ERSP noted that each site displayed at least four testimonials. However, the exact text of each testimonial appeared on multiple sites, attributed to different consumers. ERSP recommended that the marketer discontinue the use of such testimonials.

The company agreed to modify the claims at issue, and said it would provide an appropriate disclaimer on its website regarding the testimonials. Further, the company said, it “will strive to eliminate duplicate or replicated testimonials from any website it operates for the purpose of advertising its services and products, and to ensure that the testimonials are substantiated and do not overstate results from YES’ products and services.”

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