The people behind online business coaching agency Lurn promise that consumers can become “stay-at-home millionaires.” But according to the FTC, Lurn, Inc. CEOs Anik Singal, Tyrone Cohen and David Kettner are now home defendants in an FTC enforcement action challenging their deceptive money-making representations.What’s more, the complaint alleges that even after receiving a penalty notice from the FTC about Money Making Opportunities and Endorsements, Lurn and Singal continue to defraud consumers out of millions of dollars using deceptive advertising claims.
The FTC said Lurn, based in Rockville, Maryland, lured consumers through a variety of purported money-making opportunities. For example, a promotion for its email startup incubator program claimed that consumers could make millions online using what CEO Zinger calls “just email and other people’s products.” Exact Steps” to “Make Over $13,700 Every Day.” ” The ad features testimonials from a supposedly satisfied customer who made good money, quit his 9-to-5 job, traveled the world helping people in need, and “lives with his Jaguar and Aston Martin.” In a very, very nice house…” . . Work about three hours a day. ” According to the complaint, the ads invited consumers to attend a “free training seminar,” but soon after, the defendants wanted to pay $1,995 for their “time-tested and proven step-by-step system.”
Another Lurn promotion—a $947 Kindle Cashflow college course—features defendant Tyrone Cohen, who claims to teach consumers a “tried, tested, and proven step-by-step system that… Backed by more than a decade of teaching thousands of successful students from various backgrounds.” People of all ages around the world know how to make money change their lives. ” So how does this “system” work? Defendants instructed consumers to find a successful book on Amazon, imitate its content in a 10-35 page document, and then sell it on Amazon to generate an “evergreen” and “passive” income stream.
Then there was the $1,588 “Printable Profits” course, advertised in a video in which defendant Zinger interviewed defendant David Ketner about an opportunity that would provide consumers with “six Great opportunity for digit income.” According to Kettner, Printable Profits’ “easy-to-use and proven system” involves finding mugs that are selling well on Amazon and using an app to create and sell similar designs. Kettner further claimed that even if 98% of designs were unsuccessful, 2% of success would mean consumers could still earn $11,453 per month based on total online mug sales.
The company didn’t stop there. Once Lurn and Singal got someone into trouble, the defendants would often have telemarketers contact consumers to promote expensive “consulting programs” with names like “Digital Business Accelerator,” “Digital Empire” and “Market Mastery.” , and the cost to the consumer is as high as $10,000. Following the Lurn script, the telemarketer asks the consumer how much money he or she wants to make. Regardless of their answer, the telemarketer will respond with “I’m 100% confident we can help you” get the results people want.
The indictment outlines the charges in detail, but focuses on the fact that the defendants’ money-making claims were false or misleading. The complaint also describes how the FTC alleged that Lurn and Singal violated established legal principles both before and after receiving the FTC’s penalty notices.
The lawsuit alleges that the defendants’ income claims violated the Federal Trade Commission Act and that Lurn and Singal also violated the Federal Trade Commission Act. Telemarketing Sales Rules Distorting the true nature of investment opportunities.In addition, based on Penalty Notice Regarding Money-Making Opportunitiesthe FTC charged Lurn and Singal with knowing that “it is an unfair or deceptive trade practice to make false, misleading, or deceptive statements about the profits or income that participants in the money-making opportunity may expect” but continued to make illegal Income Claims.
The proposed settlement with Lurn, Singal, Cohen and Kettner includes broad injunctive provisions to protect future consumers. The proposed order against Lurn and Singal also requires them to disgorge $2.5 million in consumer refunds and to notify consumers who purchased courses from them since May 1, 2019, of the FTC’s enforcement action.
Even if you’re not selling money-making opportunities, this case sends two important messages to advertisers.
FTC Penalty Violation Notices create potential civil penalty liability, so violations can have serious financial consequences. Under Section 5(m)(1)(B) of the FTC Act, the FTC may seek civil penalties if the FTC determines that: 1) The company knew that the conduct was unfair or deceptive in violation of the Federal Trade Commission Act; 2) The FTC has issued a written determination that the conduct is unfair or deceptive. Of course, the FTC still has to prove its case, but the cost of noncompliance can be high for companies that knowingly engage in conduct that the FTC decides to declare illegal.
Don’t take earnings “disclaimers” — or any other form of disclaimer — lightly. Despite the headline-grabbing headlines and explicit representations of big money, defendants’ websites and presentations covertly included statements like: “Many of our products and promotions provide information about the potential income you may earn. message. These statements are not intended to describe a result, or even a typical result, but are actual results of those who have achieved extraordinary success… Lurn does not guarantee or guarantee that you will achieve the results stated in the promotion or the course itself the amount of revenue or revenue received.” Invalid, the FTC said: “Defendants’ disclaimers directly contradict the message they repeatedly communicated in their marketing that purchasers may earn substantial income by exploiting Defendants’ scheme.” Key The point is that what matters is the net impression conveyed to the consumer. Advertisers cannot negate their primary marketing message by: prepare for exam “Disclaimer.”