Attorney General Bill McCollum News Release
|January 10, 2008
Media Contact: Jenn Meale
Phone: (850) 245-0150
|en Español||Print Version||Tweet|
Infomercial Company to Modify Business Practices, Reimburse Dissatisfied Customers
~ Consumers will have collectively received more than $1 million in refunds for non-productive seminars ~
TALLAHASSEE, FL – Attorney General Bill McCollum today announced that his office reached a settlement with Whitney Information Network, Inc., parent company of several companies that advertise through infomercials throughout the State of Florida. Dissatisfied consumers will have received more than $1 million in refunds as a result of the state's investigation and settlement. Under the agreement, the companies – which include Millionaire University and Whitney Intelligence Academy – are also prohibited from making misleading statements or other baseless claims in their infomercials which promote various educational and training seminars and programs on how to make money through investing in the stock market and real estate.
"Advertising should never intentionally deceive or mislead our consumers. When companies make direct or indirect implications that by using their products or services, a consumer can attain wealth and financial independence when that is not the experience of the typical consumer using the product, these actions could indicate potential violations of our consumer protection laws," said Attorney General McCollum.
More than 250 consumers complained that Whitney and its related companies engaged in deceptive advertising and misleading business practices, whether through the use of "testimonials" from individuals claiming to have achieved success using Whitney's educational products or through other inaccurate statements in the infomercials about what would be taught at the seminars. Consumers complained that the introductory programs and seminars, touted as training that would change careers and lifestyles and give persons financial freedom and independence, covered only very rudimentary information and were used mainly to entice consumers to purchase "more advanced" and significantly more expensive training programs costing thousands of dollars.
Many of the individuals who signed up for Whitney's classes were elderly or retired couples on fixed incomes who were persuaded that using Whitney's "proven" methods, they could gain financial independence and live the lifestyle they desired without the investment of a lot of money or time. Whitney Information Network, Inc. has already refunded consumers more than $580,000 and, under the terms of this agreement, will reimburse the remaining consumers more than $450,000 and create a reserve account of $150,000 to be set aside for any pending and unresolved consumer complaints. As part of the agreement, the companies must also pay $150,000 to the Attorney General's Seniors vs. Crime program and will reimburse the state $150,000 for the cost of its investigation.
Whitney must also strictly refrain from making false statements or implications in its advertising or at its seminars that financial opportunities, results or claims will occur as a result of the use of its products and services unless the company can substantiate the claims as feasible for a significant number of consumers or unless a disclaimer is provided specifically stating that the purported results are not typically obtained by the majority of consumers.
Among the companies affected by the agreement are Whitney Education Group, Inc., Whitney Intelligence Academy, and Millionaire University. Some of the educational and training seminars and programs include "Teach Me to Trade" and "Star Trader" allegedly designed to teach and train consumers on how to make money through investing in the stock market, and "Focus on Foreclosure," "Wealth Builder Workshop," and "Cash Flow Generator," supposedly created to teach consumers how to make money through real estate investments. Whitney has also recently begun sponsoring similar educational programs under the name "Rich Dad Education, LLC."
A copy of the agreement signed with Whitney is here.