Scam Went on and on, Retiree Says

     MADISON, Wis. (CN) – A work-at-home scam called The Tax Club and the Money Club duped a retired woman out of $26,000, she claims in Federal Court.
     Joyce A. Alt sued The Tax Club and its dbas Prestige Financing Services, The Success Online, My Essential Plans, and Manhattan Professional Group; and the Money Club, dba Webcor and Titaneer Corp. The first set is based in New York City, the second set in Tempe, Ariz., according to the federal complaint.
     Alt, 65, says she retired in 2011 for health reasons. Her retirement and illness forced her to look for ways to earn extra money at home to help pay for rising insurance premiums.
     “In just over six months, 26 individuals, allegedly representing 11 entities, perpetrated a costly scheme designed to prey upon an unsuspecting consumer,” Alt says in the complaint.
     “After convincing Mrs. Alt to open four lines of credit, the defendants incessantly induced her to purchase bogus products and feigned services that consumed all her available credit. Only Mrs. Alt’s credit limits stopped the defendants from taking more. … As a result of these fraudulent practices, Mrs. Alt incurred $26,048.00 in debt over a 68-day period. The Tax Club and Money Club represented to Mrs. Alt that the charges were necessary to start and grow her household investment. However, the defendants did not deliver the products and services they pressured Mrs. Alt to buy. Mrs. Alt never made a sale; her investments generated $0 income. …
     “The defendants instilled a sense of hope in Mrs. Alt that investing in their scheme would provide her a better life, but nothing they sold to Mrs. Alt ever yielded a single cent of revenue.”
     It all started on Dec. 3, 2011, when Alt got a call from a man who identified himself as Richard Pitts, “falsely portraying himself as a Google, eBay and Amazon ‘affiliate,’ and encouraged her to join a ‘high-powered, cash-driven, work-at-home business venture called Money Club,'” according to the complaint.
     Pitts told her she could make $24,000 to $48,000 a year selling stuff online for four to seven hours a week, Alt says in her lawsuit.
     Pitts sold her Money Club’s “Silver J00” level package for $197 – a real deal, reduced from $247, according to the complaint.
     Next came “Paul Anderson,” who claimed to be an advertising consultant for Money Club. He told her on Dec. 7 – Pearl Harbor Day-that she needed to advertise.
     On Dec. 20 she got a call from a third man, “Mitch Williams,” who claimed to be a “marketing consultant.”
     By now the hook was set.
     The complaint states: “During this phone call, Mr. Williams advised Mrs. Alt to obtain a credit card in order to pay for her business expenses and to leverage her capital.
     “As a result of this call, Mrs. Alt obtained a VISA credit card with a $13,500.00 credit limit from UW Credit Union. Mrs. Alt incurred a $25.00 charge to expedite the card upon Mr. Williams’ request.
     “On or about December 21, 2011, Mr. Williams called Mrs. Alt again and told her that if she invested $30,000.00, she would have 200,000 guaranteed website visitors over the next year, that the products on the site would be updated constantly by Money Club, and that she would be listed on 100 search engines. Mr. Williams told Mrs. Alt to use other people’s money for this investment by charging it to credit cards.
     “On or about December 23, 2011, Mrs. Alt bought a $13,000.00 advertising package (charged to UW Credit Union VISA) from Money Club with the assurance that she would have a substantial income soon.
     “On or about December 27, 2011, Mr. Williams called Mrs. Alt and advised her to obtain more credit cards to finance her ‘business.’ Following this advice, Mrs. Alt opened the following credit cards: CITI MasterCard ($1,800.00 credit limit), Discover credit card ($3,500.00 limit), and a Chase VISA credit card ($5,000.00 limit). Combined with the UW Credit Union VISA, these additional credit cards increased Mrs. Alt’s total credit limit to $23,800.00.
     ” In the December 27, 2011, phone call, Mr. Williams induced Mrs. Alt to invest by assuring her that Money Club could ‘make up the difference’ to reach the $30,000.00 investment cost.
     “During the December 27, 2011, phone call, Mrs. Alt questioned Mr. Williams about Money Club’s poor rating with the Better Business Bureau. Mr. Williams told Mrs. Alt that Money Club has a poor rating because it refused to pay for a Better Business Bureau rating.” (Citations to Alt affidavit omitted.)
     Then The Tax Club descended on her, Alt says, selling her a “Business Saver Plus” accounting package for $4,785, with a $49.95 recurring monthly fee, all of it charged to her Visa card.
     “The package allegedly included preparation of paperwork to incorporate Mrs. Alt’s investment as a business entity, preparation of a personal tax return and preparation of a business tax return,” according to the complaint.
     They talked her into buying more advertising, a $1,744 “My Essentials” business plan, in which the Tax Club contacted Chase Bank on her behalf to raise her credit limit, Alt says. More purchases eventually maxed out all of her cards.
     In February 2012, she received emails that were supposed to teach her how to “establish, maintain and grow” her website, but Alt says they were “merely a collection of buzzwords designed to confuse Mrs. Alt about the true nature of the products.”
     Alt had enough by March and tried to withdraw from the program, but was told online that “This is a marathon, not a sprint,” and was directed back to the training material she couldn’t understand.
     She claims the various companies offered partial refunds, but only if she signed a waiver of liability. She claims she was never provided a fully functional website and never made a single cent out of all of this.
     The Federal Trade Commission caught up with the scammers and sued them on Jan. 17 this year, according to the complaint: “According to the FTC, The Tax Club used a variety of deceptive tactics to induce consumers to purchase products and services purportedly designed to assist them in building and developing small businesses.”
     Alt wants her money back, and punitive damages for fraud, misrepresentations, and failure to make required disclosures.
     She is represented by Sarah J. Orr at the University of Wisconsin Law School Consumer Law Clinic, in Madison.

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