Help Me Make The Case Against Online Trading Academy

ef11 · Post by **ef11** » Sat Apr 07, 2018 3:58 pm

Hello all,

Devout Boglehead here and have been for the past 6 years (age 23-29). Recently had a disturbing conversation with a co-worker in his mid-50s that he had begun taking classes at "Online Trading Academy" so he could trade all of his life savings as well as his mother's life savings.

The comment that scared me the most "Over the past 30 years I have averaged 11% in my 401K (not sure how he has that data...) but knowing what I learned last month I could easily have averaged over 20% per year"

As you will see from most reviews, this is basically a high-pressure sales pitch to get up to $50,000 from you to learn how to "trade". If you aren't performing well, they tell you that you are close, but need one more class to get the full knowledge to "trade". I can find no reviews or information on actual results achieved with this trading strategy. What a scam....Obviously this is a delicate conversation to have with anyone and I don't want to tread too hard, but after our conversation was finished we agreed to talk more over lunch or dinner and I had such a terrible feeling seeing a co-worker and friend being taken advantage of this way. Not only the tens of thousands of dollars spent on classes but the potential for losing so much money trading.

Any recommendations? He might just have to lose a lot before learning this isn't the answer...

Link - https://www.tradingacademy.com/
Reviews - http://www.forexpeacearmy.com/forex-rev ... created_at

livesoft · Post by **livesoft** » Sat Apr 07, 2018 4:00 pm

What does youtube.com have to say about all this?

Shallowpockets · Post by **Shallowpockets** » Sat Apr 07, 2018 4:14 pm

And visions of sugarplums danced in his head.

Tell him you certainly don't need to pay thousands to learn about this. He could start with books. Go at his own pace. This presentation he will go to will cost him upfront and it will pump him all up. Not a good thing. It is like an annuity presentation, except you lose forever all your tuition or whatever they call the cost of the programs.
Emphatic no for him. Tell him you don't want to have to say I told you so. This is not a time to tiptoe around feelings as we often do when discussing money. He is NOT into it yet, so it would be like discussing going back to school, or taking a new job. You would have an opinion on that and so you should on this, and tell him.

Pajamas · Post by **Pajamas** » Sat Apr 07, 2018 4:14 pm

ef11 wrote: ↑Sat Apr 07, 2018 3:58 pm
He might just have to lose a lot before learning this isn't the answer...

It is probably best to accept that and to stay out of his business as no matter what happens it will affect your relationship with him negatively. You're not going to talk him out of it and when he loses a lot of money, he will be too embarrassed to discuss it with you. Best to just make short, neutral comments if he brings it up again or say no more than, "Gee, that seems kinda risky!"

MNGopher · Post by **MNGopher** » Sat Apr 07, 2018 4:17 pm

In this article one of their rep's tells the reporter that you can expect 80% annualized returns day trading after finishing the course.

https://www.kiplinger.com/article/inves ... s-all.html

A claim like that should send anyone running.

4nursebee · Post by **4nursebee** » Sat Apr 07, 2018 4:21 pm

He is likely lost already.

I would love to see audited results of the teachers...then I would be willing to pay to learn.

Nobody shares ongoing results!

DanMahowny · Post by **DanMahowny** » Sat Apr 07, 2018 4:22 pm

You can't stop stupid people doing stupid things. Just let hm be.

Post by **oldcomputerguy** » Sat Apr 07, 2018 4:35 pm

I couldn't help but notice that in the first instructor bio I read, one of the credentials listed is "Accounting specialist and management consultant - Arthur Andersen & Co."

Why does this throw a red flag in my mind?

pkcrafter · Post by **pkcrafter** » Sat Apr 07, 2018 5:03 pm

Recently had a disturbing conversation with a co-worker in his mid-50s that he had begun taking classes at "Online Trading Academy" so he could trade all of his life savings as well as his mother's life savings.

If he wants to risk his own money that's one thing, but to gamble with mother's money is completely irresponsible.

Paul

ef11 · Post by **ef11** » Sat Apr 07, 2018 7:10 pm

livesoft wrote: ↑Sat Apr 07, 2018 4:00 pm What does youtube.com have to say about all this?

Hey Livesoft, I'm not finding any blaring examples of it being a scam or anything like that when searching...if you have some links please share.

Shallowpockets wrote: ↑Sat Apr 07, 2018 4:14 pm And visions of sugarplums danced in his head.

Tell him you certainly don't need to pay thousands to learn about this. He could start with books. Go at his own pace. This presentation he will go to will cost him upfront and it will pump him all up. Not a good thing. It is like an annuity presentation, except you lose forever all your tuition or whatever they call the cost of the programs.
Emphatic no for him. Tell him you don't want to have to say I told you so. This is not a time to tiptoe around feelings as we often do when discussing money. He is NOT into it yet, so it would be like discussing going back to school, or taking a new job. You would have an opinion on that and so you should on this, and tell him.

Shallowpockets, he has already completed one of the courses I believe and paid ~$12,000. He said he intends to take the entire four course series which is around $50,000 if they give you large discounts....so it might be too late.

Pajamas wrote: ↑Sat Apr 07, 2018 4:14 pm
ef11 wrote: ↑Sat Apr 07, 2018 3:58 pm
He might just have to lose a lot before learning this isn't the answer...

It is probably best to accept that and to stay out of his business as no matter what happens it will affect your relationship with him negatively. You're not going to talk him out of it and when he loses a lot of money, he will be too embarrassed to discuss it with you. Best to just make short, neutral comments if he brings it up again or say no more than, "Gee, that seems kinda risky!"

Yes...you're probably right. Just that he said he wanted to have lunch or dinner so I know he wants to talk about it. Not sure if he wants to sell me on it or if he realizes he might be getting into something not legit and wants another option...

4nursebee wrote: ↑Sat Apr 07, 2018 4:21 pm He is likely lost already.

I would love to see audited results of the teachers...then I would be willing to pay to learn.

Nobody shares ongoing results!

Yes, no results to speak of anywhere. If these people could trade like this, why wouldn't they be managing hundreds of billions for the banks instead of making $60,000 a year teaching these classes...

pkcrafter wrote: ↑Sat Apr 07, 2018 5:03 pm
Recently had a disturbing conversation with a co-worker in his mid-50s that he had begun taking classes at "Online Trading Academy" so he could trade all of his life savings as well as his mother's life savings.
If he wants to risk his own money that's one thing, but to gamble with mother's money is completely irresponsible.

Paul

Agreed. It however appears that he thinks this is completely risk free. He made comments that you always have a risk reward on every trade so you never lose too much but when you pick it right you make a great return...I wish this school would be shut down, I can't imagine the amount of hardship they have caused people teaching this crap.

Thanks for all of the replies. Was curious if anyone had any documented horror stories or anything, most of us obviously won't have first-hand experience with this scam though.

JBTX · Post by **JBTX** » Sun Apr 08, 2018 12:15 am

ef11 wrote: ↑Sat Apr 07, 2018 3:58 pm Hello all,

Devout Boglehead here and have been for the past 6 years (age 23-29). Recently had a disturbing conversation with a co-worker in his mid-50s that he had begun taking classes at "Online Trading Academy" so he could trade all of his life savings as well as his mother's life savings.

The comment that scared me the most "Over the past 30 years I have averaged 11% in my 401K (not sure how he has that data...) but knowing what I learned last month I could easily have averaged over 20% per year"

As you will see from most reviews, this is basically a high-pressure sales pitch to get up to $50,000 from you to learn how to "trade". If you aren't performing well, they tell you that you are close, but need one more class to get the full knowledge to "trade". I can find no reviews or information on actual results achieved with this trading strategy. What a scam....Obviously this is a delicate conversation to have with anyone and I don't want to tread too hard, but after our conversation was finished we agreed to talk more over lunch or dinner and I had such a terrible feeling seeing a co-worker and friend being taken advantage of this way. Not only the tens of thousands of dollars spent on classes but the potential for losing so much money trading.

Any recommendations? He might just have to lose a lot before learning this isn't the answer...

Link - https://www.tradingacademy.com/
Reviews - http://www.forexpeacearmy.com/forex-rev ... created_at

20% over 30 years would multiply your investment by a factor of approx 240. $10,000 would be $2.4 million over 30 years. Approx 15 million over 40 years. If you contributed $10,000 every year and got these returns, you’d have hundreds of millions. Why are they wasting time pimping a course to chumps in a hotel room when they could be earning that type of money on their own?

gsmith · Post by **gsmith** » Sun Apr 08, 2018 12:42 am

I've had friends who are convinced they are superheros on Forex/SP500 hedging/real estate due to some expensive class, and once they announce they are no longer interested in BH, I wish them luck and quickly turn the conversation.

Even if you are correct, you will lose his friendship, as you're doubting his skill.
Focus on your own path, and be grateful you saw this particular wealth-killer coming.

mrpotatoheadsays · Post by **mrpotatoheadsays** » Sun Apr 08, 2018 1:36 am

Recommendation: Mind your own business.

If cornered and directly asked for advice, tell him to investigate how many day trader suicides correlate to a down market.

Shallowpockets · Post by **Shallowpockets** » Sun Apr 08, 2018 9:12 am

It's funny how it is a BH thing to advocate index funds and to be skeptical of annuities and we see people offering opinions on those to others on the forum, but outside of that it is mind your own business. It is like we will offer opinions anonymously on the forum but avoid it face to face.
No trouble here telling people to get away from Edward Jones, UBS, and other such 1.5% AUM types.
I would have no trouble telling a friend that this online trading seminar is fraught with misdirection and is sketchy for anyone to invest a large sum of their money. After all, this person has not yet made a commitment to the seminar. Not as if I am getting him to change investments.

Wagnerjb · Post by **Wagnerjb** » Sun Apr 08, 2018 9:39 am

Shallowpockets wrote: ↑Sun Apr 08, 2018 9:12 am It's funny how it is a BH thing to advocate index funds and to be skeptical of annuities and we see people offering opinions on those to others on the forum, but outside of that it is mind your own business. It is like we will offer opinions anonymously on the forum but avoid it face to face.
No trouble here telling people to get away from Edward Jones, UBS, and other such 1.5% AUM types.
I would have no trouble telling a friend that this online trading seminar is fraught with misdirection and is sketchy for anyone to invest a large sum of their money. After all, this person has not yet made a commitment to the seminar. Not as if I am getting him to change investments.

The difference is that your friends using Edward Jones or UBS are investing conservatively but just being charged way too much for the financial help. People who get suckered by the likes of Online Trading Academy are gullible and greedy. If you are lucky enough to talk them out of one particular "get rich quick" scheme, they will fall for the next one that comes along.

Last month, I helped a friend whose mother is invested with UBS and being charged a very high management fee. She and her mother weren't trying to get rich quick, and they thanked me for helping them reduce the management fee at UBS.

Best wishes.

Harbormaster · Post by **Harbormaster** » Sun Apr 08, 2018 9:53 am

"It is useless to attempt to reason a man out of a thing he never was reasoned into." (Attributed to Jonathan Swift)

Perhaps a strong dope slap ?

dbr · Post by **dbr** » Sun Apr 08, 2018 10:00 am

You could just tell him he is an idiot and that it is morally irresponsible to destroy someone else's life savings no matter what he does with his own. After that it is his problem. Does he have a wife and family? You are not going to win a reasoned argument, but if you have to intervene, then a shock argument might work. Another choice is to just stay out of it. It depends on how much of the conversation you had implies that he wants an opinion from you. Whatever your opinion say it once and go away. At least then your conscience can be clear.

3funder · Post by **3funder** » Sun Apr 08, 2018 10:06 am

Shallowpockets wrote: ↑Sun Apr 08, 2018 9:12 am It's funny how it is a BH thing to advocate index funds and to be skeptical of annuities and we see people offering opinions on those to others on the forum, but outside of that it is mind your own business. It is like we will offer opinions anonymously on the forum but avoid it face to face.
No trouble here telling people to get away from Edward Jones, UBS, and other such 1.5% AUM types.
I would have no trouble telling a friend that this online trading seminar is fraught with misdirection and is sketchy for anyone to invest a large sum of their money. After all, this person has not yet made a commitment to the seminar. Not as if I am getting him to change investments.

I agree. If we have the knowledge to impart, it would be silly not to share it with someone who is about to make a huge mistake. I wouldn't hesitate for one second to offer my two cents.

2b2 · Post by **2b2** » Sun Apr 08, 2018 10:20 am

Maybe gently nudge him with the tale of Icarus.
https://en.wikipedia.org/wiki/Icarus

2b2

ef11 · Post by **ef11** » Sun Apr 08, 2018 10:37 am

JBTX wrote: ↑Sun Apr 08, 2018 12:15 am 20% over 30 years would multiply your investment by a factor of approx 240. $10,000 would be $2.4 million over 30 years. Approx 15 million over 40 years. If you contributed $10,000 every year and got these returns, you’d have hundreds of millions. Why are they wasting time pimping a course to chumps in a hotel room when they could be earning that type of money on their own?

Yes, exactly...I believe I mentioned this to him in the initial conversation and he said something like "these people have already made all the money they would ever need, and now they just want to help others" ......wow

Shallowpockets wrote: ↑Sun Apr 08, 2018 9:12 am It's funny how it is a BH thing to advocate index funds and to be skeptical of annuities and we see people offering opinions on those to others on the forum, but outside of that it is mind your own business. It is like we will offer opinions anonymously on the forum but avoid it face to face.
No trouble here telling people to get away from Edward Jones, UBS, and other such 1.5% AUM types.
I would have no trouble telling a friend that this online trading seminar is fraught with misdirection and is sketchy for anyone to invest a large sum of their money. After all, this person has not yet made a commitment to the seminar. Not as if I am getting him to change investments.

Yes, good point. If it was strictly a friend it would be one thing, being a co-worker adds some more complexity. I think I will just take the advice to only offer an opinion if asked and maybe try to nudge him in the right direction.

dbr wrote: ↑Sun Apr 08, 2018 10:00 am You could just tell him he is an idiot and that it is morally irresponsible to destroy someone else's life savings no matter what he does with his own. After that it is his problem. Does he have a wife and family? You are not going to win a reasoned argument, but if you have to intervene, then a shock argument might work. Another choice is to just stay out of it. It depends on how much of the conversation you had implies that he wants an opinion from you. Whatever your opinion say it once and go away. At least then your conscience can be clear.

Yes, he has a wife and 8 or 9 kids...Probably best that if he asks my opinion I give it once and have a clear conscience.

Pajamas · Post by **Pajamas** » Sun Apr 08, 2018 11:04 am

ef11 wrote: ↑Sat Apr 07, 2018 3:58 pm
Yes...you're probably right. Just that he said he wanted to have lunch or dinner so I know he wants to talk about it. Not sure if he wants to sell me on it or if he realizes he might be getting into something not legit and wants another option...

You didn't say that he wanted to meet with you specifically to talk about it in your original post.

Boglegrappler · Post by **Boglegrappler** » Sun Apr 08, 2018 11:09 am

It seems to me that Bogle's little book of common sense investing has most of the arguments that you need.

Good luck.

dbr · Post by **dbr** » Sun Apr 08, 2018 11:15 am

Yes, you can always hand a person a book. That might add credibility but is undercut by the fact that the other guys have a book too. I am still impressed that "YOU ARE NUTS AND BEING [criminally] IRRESPONSIBLE" is the best reply.

Post by **Mel Lindauer** » Sun Apr 08, 2018 11:16 am

Yes, exactly...I believe I mentioned this to him in the initial conversation and he said something like "these people have already made all the money they would ever need, and now they just want to help others" ......wow

Someone needs to get their BS meter out.

If they've already made all the money they'll ever need, then why are they charging for the course? If it were true (obviously it isn't), then they'd be offering to help folks for nothing, just as we do here on the Bogleheads forum.

Post by **oldcomputerguy** » Sun Apr 08, 2018 11:24 am

Mel Lindauer wrote: ↑Sun Apr 08, 2018 11:16 am
Yes, exactly...I believe I mentioned this to him in the initial conversation and he said something like "these people have already made all the money they would ever need, and now they just want to help others" ......wow
Someone needs to get their BS meter out.

If they've already made all the money they'll ever need, then why are they charging for the course? If it were true (obviously it isn't), then they'd be offering to help folks for nothing, just as we do here on the Bogleheads forum.

Or, to paraphrase... “if you’re so dang smart, why aren’t you rich?”

KSActuary · Post by **KSActuary** » Sun Apr 08, 2018 12:39 pm

Easy, if I did as well as they promised on the FX side, I would own the world in less than 5 years using their compounding.

Portfolio7 · Post by **Portfolio7** » Sun Apr 08, 2018 9:56 pm

If the people selling this system are now rich, and don't need to make any more money... why are they charging your co-worker $50K for their classes?

One other thing. I'm grateful my Dad got out for only $3K back 25 years ago or so, but these trading schemes have been around for decades. Why are none of them famous? If any of them really worked, they'd be around for more than a few years, and they'd be famous. Like Lenny Dykstra. Oops.

pkcrafter · Post by **pkcrafter** » Sun Apr 08, 2018 10:13 pm

Yeah, give him a book -- Trade Like Chuck.

Paul

daveydoo · Post by **daveydoo** » Sun Apr 08, 2018 10:41 pm

I would fight for this. I would jeopardize or lose a friendship for this.

Ask him who is in his class. Are they running a billion-dollar pension fund or hedge fund? Because those folks can't touch his expected returns. Maybe they don't have $12K for a course?

You know, if a friend puts his car seat in wrong or won't vaccinate, you can still say that statistically he is unlikely to cause harm. And if this were a stupid screenwriting class where the attendance cost is a sunk cost and the worst you can do is not succeed as a writer, that's different, too. But this is a "How to shoot an apple off your kid's head at 100 yards" course and you know he will fail. We all know he will fail. He will lose his shirt -- and everyone else's too. You have a duty to inform, imo. The stronger the friendship, the harder you have to fight him on this.

unclescrooge · Post by **unclescrooge** » Mon Apr 09, 2018 12:23 am

I think Warren Buffett only averaged 19% over his lifetime.

So congrats on finding a group of billionaires willing to share their secrets. Wonder why they charge do much if they are just trying to help people.

CurlyDave · Post by **CurlyDave** » Mon Apr 09, 2018 12:56 am

No good is going to come of this.

If he makes some money, he will be insufferable until he loses it all. When he loses it he will blame that on others.

IMHO the prudent course of action is to keep your lip zipped and keep your nose firmly in your own business.

Cigarman · Post by **Cigarman** » Mon Apr 09, 2018 4:24 am

I hear them every weekend on the radio in Raleigh....30 minute infomercial that really tells you nothing. To me, it is the same material re-hashed every weekend.

That's enough to get me to change the station and move on with my life.

EyeYield · Post by **EyeYield** » Mon Apr 09, 2018 9:09 am

Online Trading Academy is a business that relies on dreamers and fools to stay solvent.

Try to dissuade your co-worker, or is he a friend, by over encouraging him to go beyond simply learning how to trade, to teaching others how to do it.
No trading experience necessary.

The franchise requirements are few: Can your friend manage a SALES team? Does he have $250k in cash for a proven BUSINESS model? He’s qualified!
https://www.tradingacademy.com/franchis ... ation.aspx
Not required: Character, integrity, ethics.

Show him how he can blow the maximum amount of cash all at once and avoid the constant drip of pricey “education” segments by becoming a franchisee and learning the art of snake oil sales.
Not only will he get all his lessons for free, minus the franchise fee, but he’ll learn how to sell them bit by bit to the unsuspecting financially illiterate. He will learn that the top priority at OTA is profit and he is living proof that OTA has the ability to find new dreamers and fools - I mean clients - I mean students. So what is he waiting for??

If he still doesn’t see this scam for what it really is, then at least you tried.

ef11 · Post by **ef11** » Mon Apr 09, 2018 10:30 am

EyeYield wrote: ↑Mon Apr 09, 2018 9:09 am Online Trading Academy is a business that relies on dreamers and fools to stay solvent.

Try to dissuade your co-worker, or is he a friend, by over encouraging him to go beyond simply learning how to trade, to teaching others how to do it.
No trading experience necessary.

The franchise requirements are few: Can your friend manage a SALES team? Does he have $250k in cash for a proven BUSINESS model? He’s qualified!
https://www.tradingacademy.com/franchis ... ation.aspx
Not required: Character, integrity, ethics.

Show him how he can blow the maximum amount of cash all at once and avoid the constant drip of pricey “education” segments by becoming a franchisee and learning the art of snake oil sales.
Not only will he get all his lessons for free, minus the franchise fee, but he’ll learn how to sell them bit by bit to the unsuspecting financially illiterate. He will learn that the top priority at OTA is profit and he is living proof that OTA has the ability to find new dreamers and fools - I mean clients - I mean students. So what is he waiting for??

If he still doesn’t see this scam for what it really is, then at least you tried.

This is a brilliant post...got a good laugh this morning ha.

Thank you all for the feedback, I really appreciate everyone's thoughts and ideas for how to help him. If there are any developments I will report back.

Post by **oldcomputerguy** » Wed Feb 12, 2020 5:35 pm

Sorry to resurrect an old thread, but there is new information today from the Federal Trade Commission.

https://www.ftc.gov/news-events/press-r ... t-training

The Federal Trade Commission has sued the California-based investment training scheme Online Trading Academy (OTA), led by Eyal Shachar. The FTC alleges that OTA uses false or unfounded earnings claims to sell “training programs” costing as much as $50,000. OTA has collected more than $370 million from consumers nationwide within the last six years.

According to the FTC, OTA misrepresents that it has a patented “strategy” that anyone can use to generate substantial income from trading in the financial markets. OTA claims that its strategy is designed to generate income in any market, “whether it’s going up, down or sideways.” The company’s claims are often targeted at older consumers. Additionally, OTA “instructors”—salespeople on commission who market OTA’s training and strategy to consumers in live events across the county—often hold themselves out as successful traders who have amassed substantial wealth using OTA’s strategy.

However, OTA does not track the trading results of its customers, and the FTC alleges that OTA’s own surveys indicate that its customers are not making the type of income OTA advertises. Trading data from a platform used by OTA customers also suggest that the vast majority of OTA’s customers do not make any money, and many lose money on top of the money they pay OTA. Evidence obtained by the FTC also indicates that instructors’ claims of amassing wealth by using OTA’s strategy are false or unsubstantiated.

WhyNotUs · Post by **WhyNotUs** » Wed Feb 12, 2020 5:41 pm

Capt. Louis Renault: I'm shocked, shocked to find that gambling is going on in here!

I should elaborate, I know one of their instructors. He was not an experienced nor successful trader but is doing great teaching their courses. It is one of those things that he will have to learn and is fortunate to be young and hopefully can redirect his interests.

Dottie57 · Post by **Dottie57** » Wed Feb 12, 2020 10:29 pm

dbr wrote: ↑Sun Apr 08, 2018 11:15 am Yes, you can always hand a person a book. That might add credibility but is undercut by the fact that the other guys have a book too. I am still impressed that "YOU ARE NUTS AND BEING [criminally] IRRESPONSIBLE" is the best reply.

I agree - shock may actually work. Hard to do, at least for me.

Brianmcg321 · Post by **Brianmcg321** » Wed Feb 12, 2020 10:34 pm

You should ask him if the people teaching the class are billionaires like Warren Buffett.

Brianmcg321 · Post by **Brianmcg321** » Wed Feb 12, 2020 10:34 pm

You should ask him if the people teaching the class are billionaires like Warren Buffett.

tvubpwcisla · Post by **tvubpwcisla** » Wed Feb 12, 2020 10:38 pm

If he does the exact opposite of what they say, he just might have a fighters chance at success.

arcticpineapplecorp. · Tue Jan 12, 2021 4:35 pm

oldcomputerguy wrote: ↑Wed Feb 12, 2020 5:35 pm Sorry to resurrect an old thread, but there is new information today from the Federal Trade Commission.

https://www.ftc.gov/news-events/press-r ... t-training

The Federal Trade Commission has sued the California-based investment training scheme Online Trading Academy (OTA), led by Eyal Shachar. The FTC alleges that OTA uses false or unfounded earnings claims to sell “training programs” costing as much as $50,000. OTA has collected more than $370 million from consumers nationwide within the last six years.

According to the FTC, OTA misrepresents that it has a patented “strategy” that anyone can use to generate substantial income from trading in the financial markets. OTA claims that its strategy is designed to generate income in any market, “whether it’s going up, down or sideways.” The company’s claims are often targeted at older consumers. Additionally, OTA “instructors”—salespeople on commission who market OTA’s training and strategy to consumers in live events across the county—often hold themselves out as successful traders who have amassed substantial wealth using OTA’s strategy.

However, OTA does not track the trading results of its customers, and the FTC alleges that OTA’s own surveys indicate that its customers are not making the type of income OTA advertises. Trading data from a platform used by OTA customers also suggest that the vast majority of OTA’s customers do not make any money, and many lose money on top of the money they pay OTA. Evidence obtained by the FTC also indicates that instructors’ claims of amassing wealth by using OTA’s strategy are false or unsubstantiated.

that was the suit. this was the settlement:

Online Trading Academy will be required to offer debt forgiveness to thousands of consumers who purchased its “training programs,” while the company’s founder and other individuals will together pay between $5 and $9.1 million and turn over assets under the terms of a settlement with the Federal Trade Commission that is expected to result in more than $10 million to benefit injured consumers.

In February, the FTC brought a lawsuit alleging that OTA, led by Eyal Shachar, had deceived consumers for years with claims that purchasers of OTA’s investment training were likely to generate significant income. OTA claimed that anyone could learn to use its strategy, and filled its sales pitch with testimonials and hypothetical trades showing significant profits.

The FTC alleged that OTA had no evidence that purchasers were likely to realize the advertised profits, and that the company’s own surveys and third party trading data showed that most purchasers made little to no money. OTA also claimed that its instructors and salespeople were active, successful traders, pointing consumers to their supposed success as evidence the strategy worked. But the FTC alleged those claims were false or unsubstantiated, and that several high-profile OTA pitchmen admitted they did not make significant money trading. Finally, the FTC charged that when consumers realized the truth and asked for their money back, OTA illegally used form contracts to prevent them from telling the government or other consumers about OTA’s deception.

“OTA pitched a get-rich-quick investment strategy using fake or unrepresentative testimonials, depictions of wealth, and implied promises of profits,” said Andrew Smith, the Director of the FTC’s Bureau of Consumer Protection. “OTA had no support for its lavish earnings claims, and that’s illegal.”

Under the terms of the settlement, the defendants will be prohibited from making claims about potential earnings unless the claims are truthful and the defendants have written documentation to support them. They will also be prohibited from making claims without adequate support about how quickly consumers can become proficient in the defendants’ trading “strategy” or the amount of time or money needed to generate significant income.

In addition, the defendants will be prohibited from calling their salespeople “education counselors,” and from misrepresenting that instructors are active or successful traders.

The settlement also prohibits the defendants from using contracts that prevent their customers from interacting with law enforcement or posting reviews about the defendants online. It also requires the defendants to notify consumers of their right to post honest reviews and file complaints.

The settlement includes a monetary judgment of $362 million, which is partially suspended due to the defendants’ inability to pay. If the defendants are found to have misrepresented their financial status, the full amount of the judgment would become due immediately. The settlement requires Eyal Shachar to pay $8.3 million and surrender a number of vehicles to the Commission, including a Cessna 400 airplane, a 2006 Bentley Mulsanne, a luxury motor home, a Cadillac Escalade, and six minivans. Darren Kimoto must pay $736,300 and surrender a 2017 Land Rover, and Samuel R. Seiden must pay $158,000. The cash and the proceeds of the vehicle sales will be used to provide refunds to affected consumers.

In addition, the settlement will require OTA to offer debt forgiveness to consumers who have debt owed to OTA for its training. The company will be required to give these consumers notice of the offer of debt forgiveness and consumers will have 45 days to request forgiveness. Consumers who elect forgiveness will lose access to any OTA courses they have purchased.

The settlement terms allow that for every dollar of debt forgiveness that OTA customers accept, Shachar’s required payment will be decreased by 70 cents, up to $4 million.

The Commission vote approving the stipulated final order was 4-0-1, with Commissioner Rebecca Kelly Slaughter recorded as not participating. The FTC filed the proposed order in the U.S. District Court for the Central District of California.

NOTE: Stipulated final orders or injunctions, etc. have the force of law when approved and signed by the District Court judge.

source: https://www.ftc.gov/news-events/press-r ... e-consumer

MrBobcat · Post by **MrBobcat** » Tue Jan 12, 2021 5:23 pm

Edit nevermind

prd1982 · Post by **prd1982** » Tue Jan 12, 2021 5:40 pm

What a useless settlement. The folks knew they would get caught eventually, and have to give back any assets they haven't spent (or hidden). I'm guessing they will have another sure-fire technique in the market in a couple of years.

At least treat them the same as a person who robs a bank of $1,000 without showing a gun. When are we going to see if prison time for white collar crimes cuts the white collar crime rate?

dru808 · Post by **dru808** » Tue Jan 12, 2021 8:29 pm

It’s great, I’m averaging a little lower than the instructors, 72% yearly, have him sign up through my referral and I’ll get him 15% off the gold master swing trading membership.