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Bogus Car Chips Netted $15 Million, Says AG

SANTA ANA, Calif. (CN) - An Orange County man ran a $15 million fraud by selling circuit boards as bogus "performance chips" for cars, California prosecutors say.

California sued Gold Star Auto Sound, Ivar Manufacturing and Ravi Ghataode on Oct. 28 over gizmos he sold as "GForce Chips," "GForce Performance Chips," and under other names.

The state claims that Ghataode "sold this 'chip' to hundreds of thousands of consumers by making false and misleading claims, including, but not limited to, that it contains software which is specifically programmed for the purchaser's car down to the make, model and year, and that once the product is installed in the car's engine, this chip would substantially increase gas mileage (4-7 mpg), reduce emissions (by 25-40 percent), and increase the horsepower of the car (by 30-60 HP)."

Actually, prosecutors say, Ghataode sold repackaged circuit boards that were essentially useless.

The state claims he made millions by selling his "sham product," the GForce Performance Chip, to more than 300,000 customers from a small office in Irvine.

He sold the after-market chips through his website, including an image of a "phony" office building with the GForce name added using photo-editing software, according to the complaint. The site included bogus testimonials from satisfied customers, and a fake location for the business.

Ghataode claimed that the untested and unlicensed chips were engineered, and told the Better Business Bureau the company was run by "Terry McCauley" - a fake name used to shield Ghataode, prosecutors say.

In a company background page of the website, prosecutors say, the company asserted that it had been around for 16 years, was founded by "Simon J. Bruce," and had 27 people working for it.

All those claims were false, the state says.

GForce charged customers before they received the circuit boards or before the order was shipped, and some customers did not get the sham product for a year, according to the complaint.

After complaints to Irvine police and the District Attorney's Office, Ghataode's office was raided in the summer of 2012. Officers found 300 returned GForce chips, and computer records containing hundreds of complaints, the lawsuit says.

Though the California Air Resources Board ordered GForce to stop selling the product in September 2011, the GForce website is still online, prosecutors say. (On Friday morning, the website was still functioning at the address, .)

Ghataode faced civil charges in 2011 related to another one of his businesses, and a state court ordered him not to violate unfair competition laws, prosecutors say.

But Ghataode and his companies "operated, and continue to operate, their GForce performance chip business in a blatant, willful and intentional violation of this prior injunction," according to the complaint.

Goldstar does business as GForce, GForce Chips, GForce Performance Chips, Gfchips, Gold Star Audio, GS Car Audio and Dealer Cost Car Audio.

Courthouse News called GForce on Friday and left a message for Ghataode with a man who would only identify himself as "John." Ghataode did not immediately respond to a request for comment.

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