The people who presented business opportunities under the Winners brand promised to teach consumers a “foolproof system” to make big money. But according to the FTC, The Florida-based defendants defrauded Spanish-speaking consumers of millions of dollars.. The complaint, which alleges violations of the FTC Act, the Business Opportunity Rule, the Cooldown Rule, and the Consumer Review Fairness Act, outlines some particularly troubling sales tactics. For example, while they were advertising and conducting their “seminars” in Spanish, many of the key documents (including the purchase agreement outlining the cancellation policy) were often in English.
According to the complaint, the defendants styled their speech like a classic “sales funnel.” They started with ads on social media platforms like Facebook, Instagram, and YouTube, luring consumers into a two-hour “free seminar,” often at a local hotel. Once the prospects were in the room, the FTC says the defendants began a high-pressure campaign to sell them three-day workshops for between $197 and $600. According to the complaint, people who attended the workshops were subjected to amplified hard-selling tactics, promoting “mentoring” packages costing nearly $29,000.
What did the defendants promise to the consumers? Winners’ representatives said they would teach attendees everything from “A to Z” about making money in real estate or running an online store. In fact, Winner’s sales funnel focused on funneling money away from attendees and into the pockets of Winner’s companies and the people behind the plan.
Generally addressing their predominantly Spanish-speaking audience in Spanish, Ganadores’ representatives said their shows would offer attendees the opportunity for “financial freedom.” Using testimony from “experts” and alleged “students,” the defendants made specific claims for dollars and cents. For example, attendees at his real estate events were told they could expect an annual income of between $100,000 and $112,500. In their e-commerce seminars, the defendants said that consumers could make $30,000 a month in sales with $10,000 a month in profit by running a store on Amazon, and that Amazon would provide Winner attendees access to customers.
If consumers attended the seminar but didn’t buy anything, the FTC says the defendants sped up their pitch. According to the complaint, in an effort to get them to pay for the three-day workshop, Ganadores had salespeople call them and pose as satisfied customers.
Once people shelled out cash for the three-day event, Ganadores kept up the pressure for expensive “tutoring.” Some consumers were told that when purchasing a mentoring package, Winners would match them with experts who would guide them “by the hand” so there was “no way to lose.” The FTC says the representatives also told attendees that if they purchased the VIP package for between $27,000 and $29,000, Winners would help them find 100% financing for their real estate deals.
According to the complaint, the defendants asked attendees for detailed financial information purportedly to determine if they qualified for a “selective” tutoring package. What were the defendants really doing? The FTC says it was a trick to determine which prospects to target.
When people balked at the thousands more they would have to shell out, the defendants told them that the mentoring packages were available only to specially selected attendees and that Winners’ “coaches” saw in them particular potential for success. According to the complaint, some of the defendants’ representatives urged the attendees to liquidate their retirement accounts to get the cash. In addition, attendees were asked to sign up for multiple credit cards, increase their credit limits “to the max” and “float debt” from one card to the others. The FTC alleges that in some cases, if individuals were not fluent in English, “Representatives of Winners contacted consumers’ credit card companies by phone, posing as consumers, in an effort to increase credit limits.
Not surprisingly, after becoming dissatisfied with Winners’ empty promises, customers asked for refunds, requests that the FTC says the defendants rejected, citing terms of the cancellation policy that the defendants often included in English. According to the complaint, people who managed to recover some money often had to sign a standard agreement that prohibited them from communicating with others about their experience with Winners:
Likewise, the undersigned certifies that it will not initiate any defamation against “Ganadores Inversiones Bienes Raices (Vision Online, Inc.)” by any social, electronic or personal means. If so, this action will constitute a legal action by The Company for breach of the present, in which the payment of the damages caused and the payment of the legal costs incurred will be demanded.
The FTC says Winners threatened several consumers with legal action if they talked about their experience with the company.
You will want to read the complaint by the ways the FTC says the defendants broke the law, but it all comes down to this. They allegedly violated FTC Law by making false or unsubstantiated earnings claims, misrepresenting the nature of their workshops and the benefits of their mentoring programs, deceptively obtaining financial information from consumers, and using misleading reviews and endorsements. In addition, the lawsuit alleges that providing consumers with sales-related documents in a language consumers do not speak is an unfair practice, in violation of the FTC Act. The FTC also alleges that the defendants violated numerous provisions of the business opportunity rule and the cooling rule. Moreover, the lawsuit accuses that the gag clauses of Winners violated the Consumer Review Fairness Act.
Do Winners tactics sound familiar? That shouldn’t be a surprise. The FTC says individual defendants Richard Alvarez, Robert Shemin and Bryce Chamberlain previously worked for zurixxa similar scheme that the FTC sued in 2019. In addition, Richard Alvarez and Sara Alvarez also participated in FBA Storesanother operation sued by the FTC in 2018.
A federal court has entered into a temporary restraining order in the case, but even at this early stage, it is a reminder that the protections of the FTC Act apply regardless of the language defendants use to present their products or services. Help members of your community by sharing consumer education resources from the FTC, Available in English, Spanish and 11 other languages..