May 13, 2005, 12:00 AM

FTC reaches settlement with Internet mall operators

The FTC has settled charges with the operators of several online malls, barring them from making false or misleading statements about earnings or income and engaging in illegal pyramid schemes.

Paul Demery

Managing Editor, B2B E-commerce

The Federal Trade Commission has settled charges with the operators of several online malls, barring them from making false or misleading statements about earnings or income and engaging in illegal pyramid schemes. The defendants are subject to suspended judgments totaling $12 million.

The businesses named in the FTC complaint were NexGen3000.com, Globion Inc., Mall Ventures Inc., and 2by2.net. The businesses operated independently but promised investors substantial incomes from selling products, the FTC said.

However, investors didn’t sell products and instead, earned money by bringing in other investors. Most of the investors lost money, according to the FTC.

The retail mall organizations could not be reached.

 

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