Agency: Federal Trade Commission (FTC)Washington
Description:
On August 26, 2016, Jeremy Johnson, IWorks, and 26 corporate defendants agreed to a $280.9 million judgment with the Federal Trade Commission (FTC) in connection with a Complaint filed by the FTC in December 2010. The agreement was filed in the US District Court in Nevada The complaint alleges that IWorks enticed consumers to sign up for purportedly “free” or “risk free” trials, but then charged them recurring monthly fees they never agreed to pay.
The stipulated orders against Jeremy Johnson and Ryan Riddle ban them from selling grant products, investment opportunities, continuity programs, and forced upsells (add-on products bundled with the offered product), and from using negative option features (automatically billing a consumer unless the consumer specifically declines the offered product). Johnson and Riddle are also banned from debiting consumers’ bank accounts without first obtaining their express verifiable authorization, and from misrepresenting material facts about any product, including the total cost or any associated risks.
The order against Andy Johnson bans him from selling products as forced upsells. The orders against Jeremy Johnson, Ryan Riddle and Andy Johnson also prohibit them from violating the Electronic Fund Transfer Act, selling or otherwise benefitting from consumers’ personal information, and failing to dispose of consumer information properly.
Under stipulated orders entered against Jeremy Johnson’s wife, Sharla Johnson, and his parents, Kerry and Barbara Johnson, Sharla Johnson agrees to surrender the family home in St. George, Utah, three holding companies, and various properties, including aircraft and investment accounts. Johnson’s parents will surrender four parcels of land in California and Utah, and hundreds of thousands of dollars worth of precious metals.
Four other individual defendants reached settlements with the FTC in October 2013, April 2014, and February 2016. Litigation continues against three remaining individual defendants and four companies they own.
In another matter involving the IWorks scheme, a federal jury in Utah convicted Jeremy Johnson and Ryan Riddle of making false statements to a bank on multiple IWorks merchant account applications. After Johnson and Riddle agreed to settle with the FTC, Johnson was sentenced to 11 years and three months in prison, and Riddle to five years and three months. Both men will be subject to three years of supervised probation upon release.
Click here for complete information on the case.
Date of Action: 8/26/2016