Court Halts Phony Work-at-Home Marketer: $16 Million Restitution for Defrauded Consumers

A federal district court in Chicago, Illinois, has ordered a firm that used deceptive ads to lure thousands of consumers to invest in home employment opportunity programs and other scams to pay back $16 million and has barred its president from deceptive practices in the future. The Federal Trade Commission had charged that Pase Corporation, and its president, Robert J. Febre, falsely represented that consumers investing in the Pase "work-at-home" programs could reasonably expect to earn specified sums of money by performing certain tasks. The Commission alleged that the defendants used deceptive advertisements and mailings in connection with five of their work-at-home business opportunities and with three programs that purported to offer grants, loans and credit cards to consumers.

Pase, which has shut down, was located in Aurora, Illinois.

According to the complaint detailing the charges in the case, Pase ads made claims such as:

• "WE’LL PAY YOU TO TYPE NAMES AND ADDRESSES FROM HOME. $500 per 1000."
• "GETTING PAID UP TO $1800 PER DAY OR MORE IS EASY WITH OUR AMAZING PHOTO SYSTEM. . . that can mean to you a whopping $9000 per week or more!"
• "WE WILL PAY YOU for calls received by our 900 number. We will supply you with a system which tells you how to receive $3.50 per 900 call."

The work-at-home programs Pase was touting induced consumers to do work that generated inquiries regarding financial products or services offered in other Pase programs. The

earnings were not what Pase and Febre touted, and consumers’ costs to participate in the programs were not disclosed until after the consumers had made their initial payments to Pase, according to the FTC.

Other Pase programs were misrepresented as offers of grants or grant agents, as loan services or as credit card offers. The ads that touted them claimed:

• "We have determined that you have met preliminary free grant guidelines and as a result could receive a free grant of up to $37,890 immediately."
• "INTRODUCING SELF-LIQUIDATING LOANS. NOW BORROW THOUSANDS OF DOLLARS WITHOUT EVER REPAYING A PENNY!"
• "Account Approval Notice $30,000.00 Credit Limit . . . This account is reserved for you without obligation."

In fact, the FTC alleged, after paying between $7.00 and $189.90, consumers learned that the defendants were selling books that contained general information about jobs, money-making opportunities, entities that offered grants, or tax havens, and soliciting consumers’ assistance in selling products for Pase.

Under the order issued by the court, Pase and Febre would be prohibited from making material misrepresentations about any work opportunity program or opportunities to obtain grants, loans, credit cards or other products or services, including misrepresentations about earnings or profits. The order would also require disclosure of any facts material to consumers’ decisions to participate in or purchase their publications, products or services. In addition, Febre and Pase have been ordered to pay $16,096,345.00.

The FTC’s Chicago Regional Office handled the investigation and court case with the assistance of the Illinois Attorney General’s Office and the Chicago Better Business Bureau.

Copies of the court documents associated with this case and news releases are available from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 202- 326-2502. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC’s World Wide Web site at: http://www.ftc.gov

(FTC File NO. 932-3318)
(Civil Action No. 94C 3625)