- A get-rick-quick scheme that hit the Net and the earthbound world alike - and in six U.S. states and five other countries - has agreed to pay $20 million in customer redress in a settlement with the Federal Trade Commission.
SkyBiz's "e-Commerce Web Pak," sold on- and offline for $125 a pop, was determined a "classic pyramid scheme" that focused mostly on the big money recruits could make by recruiting other participants, the FTC said March 24.
"Participants were urged to invest in more than one "Web Pak" to maximize their earning potential," the FTC said in a statement. "...(We) charged that the claims that consumers who invested in SkyBiz would make substantial income were deceptive; that the defendants' failure to disclose that most people in pyramid schemes lose money is deceptive; that the defendants provided the means and instrumentalities for others to deceive consumers by providing speakers and promotional materials that made the false and misleading claims; and that SkyBiz was actually an illegal pyramid scheme."
The FTC needed help from law enforcement in Hawaii, Michigan, North Carolina, Oklahoma, and Wyoming as well as from Australia, Canada, New Zealand, South Africa, and the U.K., to bring the Oklahoma-based operation down.
The SkyBiz case would have gone on trial January 6, but the company and the FTC agreed in principle to settle the case two days earlier. Four corporate entities in the case - SkyBiz.com, World Service Corporation, Nanci Corporation International, and WorldWide Service Corporation, were named in the original suit, as were Elias, Nanci, and Kier Masso, James S. Brown, Stephen D. McCullough, and Ronald E. Blanton.
Blanton settled with the FTC a year ago, while McCullough goes on trial April 14 in the case.
