International Law

Montana Securities Claims ACN is a Pyramid

Montana Securities Commissioner Lindeen takes action against ACN, Inc for alleged pyramid scheme

      Montana Commissioner of Securities and Insurance Monica J. Lindeen announced the issuance of a Cease and Desist Order and Notice of Proposed Agency Action against ACN, Inc. for allegedly operating a "pyramid scheme."

The actions allege ACN lured hundreds of Montanans to join with deceptive claims that members could earn large sums of money through the recruitment of new participants and through the sale of phone services. Also named in the actions are Gregory Provenzano, Robert Stevanovski, Anthony Cupisz and Michael Cupisz, all officers and founders of ACN. ACN is located in North Carolina. 
       
      "Pyramid schemes are immensely profitable to a few individuals at the top and a complete loss for almost everyone else," Commissioner Lindeen said. "The actions against ACN and its officers seek to shut down the company's alleged unlawful operation before more people lose their hard-earned money." 
       
      The actions allege ACN operates an illegal pyramid scheme that only benefits members if and when they find enough new members to join the scheme. Once enrolled, members who join the program earn compensation for each new person they enlist.

The Company attracts new members by claiming "the bottom line in building your ACN business is that you are acquiring customers and sponsoring 'customer getters' in order to build a residual income for yourself." 
      

The actions also allege that the only way an ACN participant can earn compensation is the recruitment of new participants to sell a phone service that is largely not available for use in Montana.

Participants are told that if they recruit two qualified team trainers who also then recruit two additional qualified team trainers and each participant acquires 20 customers to purchase a phone service, their income can be as much as $11,000 per month. 
       
The Commissioner's Office found an overwhelming portion of revenues earned by ACN representatives was derived from participants who must personally buy a telephone service that does not work in many parts of Montana to become managers or recruit new participants into the program.

In 2008, ACN recruited 91 Montana participants who paid approximately $61,741.69 to be a part of the program. Only two of the participants made any money, with one participant making $696 and the other making $700.

In 2009, ACN recruited over 300 Montana participants who paid approximately $234,813.02 to be a part of the program. ACN's records indicate a mere $896.86 was paid out in compensation to these participants. ACN's records indicate participants are located throughout Montana. 
      

Individuals and companies promoting a pyramid promotional scheme in Montana can be fined as much as $10,000 per violation." 

ACN selling products that don't work?

Shocked, I am shocked.

What will Mr. Trump say at their next convention?

Full post as published by Misleading Advertising Law on August 04, 2010 (boomark / email).