Jeremy Johnson
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(Las Vegas, NV) – The Federal Trade Commission has sued scores of interrelated Internet companies operating from St. George, Utah, and Las Vegas claiming they victimized hundreds of thousands of consumers by charging their credit cards and debit cards without authorization. (Redacted Complaint)
The suit, filed in US District Court in Las Vegas, claims the network of companies, including dozens of shell companies around the country, were organized by defendant Jeremy Johnson of St. George, Utah. A message for comment from Johnson was not returned.
The FTC complaint claims, “The defendants operate a far-reaching Internet enterprise that deceptively enrolls unwitting consumers into memberships for products or services and then repeatedly charges their credit cards or debits funds from their checking accounts without the consumers’ knowledge or authorization for memberships the consumers never agreed to accept.” The government agency charges in the suit that “The scam has caused hundreds of thousands of consumers to seek chargebacks, reversals of charges to their credit cards or debits to their banks accounts.”
“The high number of chargebacks has landed the defendants in Visa’s and MasterCard’s chargeback monitoring programs, resulted in millions of dollars in fines for excessive chargebacks, and termination of numerous of defendants’ merchant accounts through which they had been billing their victims,” according to the Complaint.
The lawsuit states, “Rather than curing their deceptions, defendants have employed a variety of stratagems to continue and expand their scam, thereby causing unreimbursed consumer injury since 2006 that amounts to millions of dollars.” Actual amounts are redacted in the court filing.
The court record says that in 2009 the defendants incorporated more than 50 shell companies using mail drop addresses and straw-figures as owners and officers because they knew that it was unlikely they could obtain additional merchant accounts using existing companies, due to the negative chargeback histories to these companies.
The FTC alleges the defendants then applied through intermediary payment processors for new merchant accounts in the names of the front companies in order to continue processing the credit and debit card charges for the online memberships the defendants sell.
The FTC complaint says, “They (the Defendants) have also attempted to drive down their chargeback rates by threatening to report consumers who seek chargebacks to an Internet consumer blacklist they operate called ‘BadCustomer.com’ that will “result in member merchants blocking [the consumer] from making future purchases online. And they have attempted to counter the large number of complaints about their conduct by flooding the Internet with supposedly independent positive articles and other web pages.”
The websites operated by the defendants claim to offer free or risk-free information about what the FTC alleges are dubious products and services such as government grants to pay personal expenses and Internet-based money-making opportunities.
The defendants, who have not yet answered the allegations, include several Johnson companies:
•Cloud Nine Marketing Inc., Internet Economy, Inc. and Network Agenda, LLC of Las Vegas, Nevada.
• Market Funding Solutions Inc. of Reno, Nevada.
• I Works, Inc., Elite Debit, Inc. and Success Marketing, Inc. of St. George, Utah.
• CPA Upsell, Inc. of Santa Monica, California.
Also sued were:
• Anthon Holdings Corporation of St. George, Utah.
• Duane Fielding, owner of Anthon and co-owner of Network Agenda.
Other defendants, some of which are alleged to be shell companies, are based in California, Delaware, Nevada, New York, Oklahoma and Utah. They include: Employee Plus, Inc., Big Bucks Pro, Inc., Blue Net Progress, Inc., Blue Streak Processing, Inc., Bolt Marketing, Inc. and Bottom Dollar, Inc., Bumble Marketing, Inc., Business First, Inc., Business Loan Success, Inc., Cold Bay Media, Inc., Costnet Discounts, Inc., CS Processing, Inc., Cutting Edge Processing, Inc., Diamond J Media, Inc., eBusiness First, Inc., eBusiness Success, Inc., eCom Success, Inc. and Excess Net Success, Inc., Fiscal Fidelity, Inc., Fitness Processing, Inc., Funding Search Success, Inc., Funding Success, Inc., GG Processing, Inc., GGL Rewards, Inc., Highlight Marketing, Inc., Hooper Processing, Inc., Internet Business Source, Inc., Internet Fitness, Inc., Jet Processing, Inc., JRB Media, Inc., Lifestyles For Fitness, Inc., Mist Marketing, Inc., Money Harvest, Inc., Monroe Processing, Inc. and Net Business Success, Inc., Net Commerce, Inc., Net Discounts, Inc., Net Fit Trends, Inc., Optimum Assistance, Inc., Power Processing ,Inc., Premier Performance, Inc., Pro Internet Services, Inc., Razor Processing, Inc., Rebate Deals, Inc., Revive Marketing, Inc., Simcor Marketing, Inc., The Net Success, Inc., TranFirst, Inc., Tran Voyage, Inc., Unlimited Processing, Inc., Xcel Processing, Inc. and Summit Processing, Inc.
Besides Johnson and Fielding, individuals sued include: Andy Johnson, Jeremy Johnson’s brother and alleged owner of some of the defendant companies; Lloyd Johnston, an I Works manager; Scott Leavitt, an I Works manager; Scott Muir, uncle to Jeremy and Andy Johnson and owner of some of the defendant companies; Bryce Payne, an I Works manager; Kevin Pilon, an I Works employee and alleged owner of companies I Works with which the company is associated; Ryan Riddle, former general manager of I Works; and Terrason Spinks, described as a business associate of Jeremy Johnson.
The FTC in its lawsuit has asked the court for an injunction barring future violations of the Federal Trade Commission act as well as unspecified redress for consumers harmed by the alleged scams.
Read more: KCSG Television – FTC Sues Internet Companies for Credit Card Debit Card Fraud
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