Md. AG Joins State, Federal Law Enforcers in Money-For-Nothing Scams Crackdown - Southern Maryland Headline News

Md. AG Joins State, Federal Law Enforcers in Money-For-Nothing Scams Crackdown


Maryland concludes 22 enforcement actions in 2006 as part of Project FAL$E HOPE$

ANNAPOLIS - Maryland Attorney General J. Joseph Curran, Jr. announced on Tuesday that his Office has joined the Federal Trade Commission, the Department of Justice, the United States Postal Inspection Service, and law enforcement agencies from 11 states in a sweep targeting sellers of business opportunities, franchises, and work at home scams. Of the 100 law enforcement actions announced today, 22 were brought by the Maryland Attorney General’s Securities Division.

Attorney General Curran stated that “Maryland’s participation in Project FAL$E HOPE$ demonstrates that this office will continue to aggressively enforce Maryland’s investor protection laws, including the laws designed to protect our citizens who purchase franchises and business opportunities.” Curran warned Maryland citizens to be cautious before investing their money in any business opportunity.

The Attorney General's actions include consent orders, settlement agreements, orders to show cause, and a final order to cease and desist. The Maryland actions alleged among other things, that sellers violated registration requirements, misrepresented a material aspect of their franchise or business opportunity, or made unlawful earnings claims to buyers to entice them to buy a franchise or business opportunity.

In one Maryland action, the Securities Division of the Maryland Attorney General’s Office issued a Final Order to Cease and Desist against Florida-based Coffee Heaven, LLC and James "Jay" Cummings in connection with their sale of a coffee vending machine business opportunity. According to the Securities Division’s order, Coffee Heaven and Cummings represented that buyers could expect a 300% to 700% return on their investment. At least one Maryland resident paid more than $30,000 for the Coffee Heaven business opportunity after the company gave him materials stating that he could realize a net income of more than $89,000 a year. Coffee Heaven misrepresented to buyers the cost for each cup of coffee, did not register the business opportunity as required by Maryland’s Business Opportunity Act, and did not give the Maryland buyer the required disclosure statement before selling him the business opportunity.

According to Curran, “In many cases the best protection against business opportunity fraud we can offer is to suggest you call us before investing in any business venture.” The Securities Division can be reached at (410) 576-6360, or visit our website at http://www.oag.state.md.us/.

Other enforcement actions in Maryland include:

Coffee Beanery, Ltd. and Kevin Shaw, Consent Order, Michigan parties, Maryland Attorney General’s Office, Securities Division (9/12/06)

Aussie Pet Mobile, Consent Order, California party, Maryland Attorney General’s Office, Securities Division (1/25/06)

Carpet Network, Inc., Consent Order, New Jersey party, Maryland Attorney General’s Office, Securities Division (2/9/06)

Emerald Coast Mfg., Inc., dba Java Jo’z Coffee, Agreement, Florida party, Maryland Attorney General’s Office, Securities Division (2/10/06)

Humitech Franchise Corp., Consent Order, Texas party, Maryland Attorney General’s Office, Securities Division (2/28/06)

Online Outpost Licensing Corp., Agreement, Florida party, Maryland Attorney General’s Office, Securities Division (2/28/06)

KaBloom Franchising Corp., Consent Order, Massachusetts party, Maryland Attorney General’s Office, Securities Division (3/16/06)

Daily Grind of Winchester, Inc., Agreement, Virginia party, Maryland Attorney General’s Office, Securities Division (3/29/06)

Multicorp Franchising, Inc., Consent Order, Maryland party, Maryland Attorney General’s Office, Securities Division (4/7/06)

The Dale Group, d/b/a Blind Brokers Network, Consent Order, California party, Maryland Attorney General’s Office, Securities Division (4/24/06)

Commercial Property LLC and William Stredney, Arizona parties, Consent Order, Maryland Attorney General’s Office, Securities Division (5/1/06)

Mailcoups, Inc., d/b/a Supercoups, Consent Order, Massachusetts party, Maryland Attorney General’s Office, Securities Division (5/16/06)

A Nanny on the Net, Consent Order, North Carolina/Virginia party, Maryland Attorney General’s Office, Securities Division (5/22/06)

Champion Child, Inc., d/b/a Stretch-N-Grow, Consent Order, Florida party, Maryland Attorney General’s Office, Securities Division (5/23/06)

Quiznos Franchising, LLC and Quiznos Franchising II, LLC, Consent Order, Colorado parties, Maryland Attorney General’s Office, Securities Division (7/27/06)

Lady of America Franchise Corp. and Charles Cavuoto, Order to Show Cause, Florida parties, Maryland Attorney General’s Office, Securities Division (8/4/06)

GNC Franchising, LLC, Consent Order, Pennsylvania party, Maryland Attorney General’s Office, Securities Division (8/15/06)

Coffee Heaven, LLC and James “Jay” Cummings, Final Order to Cease & Desist, Florida parties, Maryland Attorney General’s Office, Securities Division (8/16/06)

Midwestern Enterprises, Inc., d/b/a InkRX and InkRX.com, Consent Order, Wisconsin party, Maryland Attorney General’s Office, Securities Division (9/21/06)

Teen Golf Adventures, LLC, d/b/a Total Golf Advertures, Consent Order, California party, Maryland Attorney General’s Office, Securities Division (11/1/06)

United Business Solutions, Inc., d/b/a UBS Group, Order to Show Cause, Iowa party, Maryland Attorney General’s Office, Securities Division (10/5/06)

Slim and Tone, LLC, Consent Order, Pennsylvania party, Maryland Attorney General’s Office, Securities Division (11/29/06) Texas

Bio Performance, Inc. and Lowell Mims and Gustavo Romero, Petition for Temporary Restraining Order, Temporary Injunction and Permanent Injunction and Asset Freeze, Texas parties, Texas Attorney General’s Office, Consumer Protection & Public Health Division (May 17, 2006)

A complete list of the federal and state actions announced today as part of Project FAL$E HOPE$, including the actions announced by the Maryland Attorney General, can be found at http://www.ftc.gov/os/2006/12/StateEnforcementActions.pdf.

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