United States of America: Federal Trade Commission announced lawsuit against FBAMachine and affiliates for alleged deceptive e-commerce business opportunity practices

On 3 June 2024, the Federal Trade Commission (FTC) filed a lawsuit before the United States District Court for the District of New Jersey against e-commerce automation company FBAMachine, and its affiliates, alleging defrauding consumers of at least USD 11.1 million through false earnings claims about Amazon and Walmart store automation services. The defendants allegedly violated the FTC Act, Business Opportunity Rule, and Consumer Review Fairness Act. It was highlighted that the defendants made unsubstantiated promises of substantial passive income, including six-figure returns and USD 100,000+ monthly profits, charging consumers USD 30'000 to USD 500'000 in initial fees plus ongoing costs, failing to provide required disclosure documents, and using illegal non-disparagement clauses to silence customer complaints and condition refunds on removing negative reviews. The FTC sought permanent injunctions, asset freezes, appointment of a receiver, and monetary relief to compensate harmed consumers.