Defendant in Money-Making Scheme Settles FTC Charges

Defendant in Money-Making Scheme Settles FTC Charges
Image: Pixabay
March 8, 2016

One of the defendants in a money-making scheme has agreed to settle Federal Trade Commission (FTC) charges.

Loyd Johnston allegedly took more than $280 million from consumers via deceptive trial memberships for bogus government-grant and money-making schemes.

Johnston, along with Jeremy Johnson and nine others, were named in a complaint the FTC filed against the operation in December 2010. The court subsequently froze the assets of Johnson and 61 corporate defendants and appointed a receiver over their assets to help ensure that money can be returned to consumers if the case is resolved in the FTC's favor. The FTC reached a settlement with two of the defendants in November 2013, and with another defendant in April 2014.

The settlement order against Loyd Johnston bans him from engaging in lines of business like those that were used in the iWorks scheme.

In addition, the order bars Johnston from selling or otherwise benefitting from consumers' personal information, and failing to dispose of it properly. It also prohibits him from making misrepresentations in order to obtain account services from payment processors, banks, and other third parties, and from failing to disclose to them any material information about a merchant account.

The settlement order imposes a $7 million judgment that will be suspended based on Johnston's inability to pay. The full judgment will become due immediately if he is found to have misrepresented his financial condition.

Litigation continues against the remaining defendants.