FTC Stops Alleged Business Opportunity Scheme That Purportedly Promised Its AI-Boosted Tools Would Power High Earnings Through Online Stores
“The defendants preyed on consumers looking to provide for their families with promises of high returns and the use of AI to power such returns,” said FTC attorney Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “Their lies caused consumers to lose tens of thousands of dollars, with many losing their life savings. The FTC is working to hold defendants accountable and to secure redress for their victims.”
The FTC’s complaint against defendants Roman Cresto, John Cresto, and Andrew Chapman, through their companies Automators AI, Empire Ecommerce and Onyx Distribution, claims that the vast majority of defendants’ clients did not make the promised earnings or even recoup their investment. Instead, most clients allegedly lost significant amounts and Amazon and Walmart have routinely suspended or terminated the stores that defendants operated for repeated policy violations, according to the FTC.
The complaint charges that the Crestos and Chapman deceived consumers about the scheme in numerous ways, including by making false claims about:
- Their own background: The Crestos and Chapman allegedly falsely claim to have a proven record of helping numerous consumers make money in online stores. In one video, according to the FTC, Roman Cresto falsely claims he is a “leading 8-figure Amazon entrepreneur and creator of industry leading wealth-generation systems.”
- Lavish promises of success: The purported scheme allegedly relied on numerous false or baseless projections and stories of success, including “$4k-$6k consistently monthly net profit,” and “$200k in one month and 100% ROI (return on investment) in 8 months.”
- Endorsements and affiliate marketing: The complaint cites an example in which an affiliate marketer of Automator allegedly made claims on social media about his success with Automators, pointing to sales and profit numbers that the Crestos and Chapman purportedly knew were false. According the the FTC, the affiliate marketer’s e-store was losing money and got shut down.
- Artificial intelligence: Defendants allegedly claimed to use “AI machine learning” to maximize revenues, such as “We’ve recently discovered how to use AI tools for our 1 on 1 Amazon coaching program, helping students achieve over $10,000/month in sales!”
- Venture capital backing: Defendants allegedly claimed that Empire was backed by “venture capital,” when, according to the FTC, no money was ever invested into Empire by a venture capital firm.
Numerous consumers allegedly complained to defendants about their losses and, the complaint charges, instead of being offered refunds they were offered new online storefronts on different platforms. In addition, defendants allegedly pressured such consumers to sign non-disparagement agreements to prevent them from posting reviews about defendants and their services.
The complaint charges that the defendants violated the FTC Act, the Business Opportunity Rule, and the Consumer Review Fairness Act, and it asks the court to permanently shut down the company’s operations.
The complaint was filed in the U.S. District Court for the Southern District of California. The court entered the temporary restraining order against the defendants on August 11, 2023.
Informational purposes only. Not legal advice. May be considered attorney advertising.
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