DONALD TRUMP AND TRUMP UNIVERSITY SUED NATIONWIDE, ROBERT PAISOLA REPORTS 2016

UPDATE: 3-2016  TO THE NATIONAL MEDIA: YOU KEEP CALLING OUR USA OFFICES ABOUT OUR INVOLVEMENT WITH TRUMP UNIVERSITY. WE WERE THE NATIONAL BACKBONE FOR THE ORGANIZATION. WE WERE BASED IN PROVO, UTAH .  WE DID THE COACHING AND MENTORING AND WORKED WITH BILL ZANKER AT THE LEARNING ANNEX. WE PAID TRUMP 1 MILLION DOLLARS "Per Appearance" . And, YES, THERE WERE LAWSUITS FILED... HERE IS OUR ORIGINAL STATEMENT from 2014  Robert Paisola, CEO

2016 UPDATE- WE HAVE ALL THE TRUMP UNIVERSITY LAWSUIT DOCUMENTS HERE!!!

DONALD TRUMP AND TRUMP UNIVERSITY SUED NATIONWIDE, ROBERT PAISOLA REPORTS

MORE LAWSUITS OUT OF UTAH! DONALD TRUMP SUED. ALL FULFILLMENT WAS DONE OUT OF THE SALT LAKE CITY AND PROVO UTAH AREAS. I WAS THERE.  IF YOU HAVE A COPY OF THE LAWSUIT PLEASE EMAIL TO ROBERT@ROBERTPAISOLA.COM  WHO IS BILL ZANKER WITH THE LEARNING ANNEX  LETS LOOK AT JOHN SWALLOW?   (Do your research America)

CLASS ACTION 1

http://mycollector.com/Cohen-v.-Donald-Trump-complaint-.pdf

CLASS ACTION 2

http://mycollector.com/Trump-University-2nd-Amended-Complaint-12-16-10.pdf

Michael Cohen told the Associated Press on Saturday that Schneiderman's lawsuit was filled with falsehoods. Cohen said Trump and his university never defrauded anyone.  LOL

The New York State attorney general’s office filed a civil lawsuit on Saturday accusing Trump University, Donald J. Trump’s for-profit investment school, of engaging in illegal business practices.

The lawsuit, which seeks restitution of at least $40 million, accused Mr. Trump, the Trump Organization and others involved with the school of running it as an unlicensed educational institution from 2005 to 2011 and making false claims about its classes in what was described as “an elaborate bait-and-switch.”

In a statement, Eric T. Schneiderman, the attorney general, said Mr. Trump appeared in advertisements for the school making “false promises” to persuade more than 5,000 people around the country — including 600 New Yorkers — “to spend tens of thousands of dollars they couldn’t afford for lessons they never got.”

The advertisements claimed, for instance, that Mr. Trump had handpicked instructors to teach students “a systematic method for investing in real estate.” But according to the lawsuit, Mr. Trump had not chosen even a single instructor at the school and had not created the curriculums for any of its courses.

“No one, no matter how rich or famous they are, has a right to scam hardworking New Yorkers,” Mr. Schneiderman said in the statement. “Anyone who does should expect to be held accountable.”

The inquiry into Trump University came to light in May 2011 after dozens of people had complained to the authorities in New York, Texas, Florida and Illinois about the institution, which attracted prospective students with the promise of a free 90-minute seminar about real estate investing that, according to the lawsuit, “served as a sales pitch for a three-day seminar costing $1,495.” This three-day seminar was itself “an upsell,” the lawsuit said, for increasingly costly “Trump Elite” packages that included so-called personal mentorship programs at $35,000 a course.

On Saturday evening, Michael Cohen, a lawyer for Mr. Trump, denied the accusations in the lawsuit and said the school had received 11,000 evaluations, 98 percent of which rated students as “extremely satisfied.”

George Sorial, another lawyer for Mr. Trump, called the lawsuit politically motivated. He said that Mr. Schneiderman had asked Mr. Trump and his family for campaign contributions and grew angry when denied.

“This is tantamount to extortion,” Mr. Sorial said.

Andrew Friedman, a spokesman for the attorney general’s office, said that although Mr. Schneiderman had accepted a contribution from Mr. Trump in the past, “the fact that he’s still brave enough to follow the investigation wherever it may lead speaks to Mr. Schneiderman’s character.”

NY AG Sues Trump, 'Trump University,' Claims Fraud

New York's attorney general sued Donald Trump for $40 million Saturday, saying the real estate mogul helped run a phony "Trump University" that promised to make students rich but instead steered them into expensive and mostly useless seminars, and even failed to deliver promised apprenticeships.

Trump shot back that the Democrat's lawsuit is false and politically motivated.

Attorney General Eric Schneiderman says many of the 5,000 students who paid up to $35,000 thought they would at least meet Trump but instead all they got was their picture taken in front of a life-size picture of "The Apprentice" TV star.

"Trump University engaged in deception at every stage of consumers' advancement through costly programs and caused real financial harm," Schneiderman said. "Trump University, with Donald Trump's knowledge and participation, relied on Trump's name recognition and celebrity status to take advantage of consumers who believed in the Trump brand."

But Trump's attorney accused Schneiderman of trying to extort campaign contributions from the real estate mogul through his investigation of Trump. Attorney Michael D. Cohen told The Associated Press on Saturday that Schneiderman's lawsuit was filled with falsehoods. Cohen said Trump and his university never defrauded anyone.

He said Trump University provided nearly 11,000 testimonials to Schneiderman from students praising the program and said 98 percent of students in a survey termed the program "excellent."

"The attorney general has been angry because he felt that Mr. Trump and his various companies should have done much more for him in terms of fundraising," Cohen said. "This entire investigation is politically motivated and it is a tremendous waste of taxpayers' money."

State Board of Elections records show Trump has spent more than $136,000 on New York campaigns since 2010. He contributed $12,500 to Schneiderman in October 2010, when Schneiderman was running for attorney general, records show. An outspoken conservative, Trump himself flirted with a presidential run last year.

"Donald Trump will not sit back and be extorted by anyone, including the attorney general," Cohen said.

The lawsuit says many of the wannabe moguls were unable to land even one real estate deal and were left far worse off than before the lessons, facing thousands of dollars in debt for the seminar program once billed as a top quality university with Trump's "hand-picked" instructors.

Schneiderman is suing the program, Trump as the university chairman, and the former president of the university in a case to be handled in state Supreme Court in Manhattan. He accuses them of engaging in persistent fraud, illegal and deceptive conduct and violating federal consumer protection law. The $40 million he seeks is mostly to pay restitution to consumers.

He dismissed Trump's claim of a political motive.

"The fact that he's still brave enough to follow the investigation wherever it may lead speaks to Mr. Schneiderman's character," Schneiderman spokesman Andrew Friedman told AP.

State Education Department officials had told Trump to change the name of his enterprise years ago, saying it lacked a license and didn't meet the legal definitions of a university. In 2011 it was renamed the Trump Entrepreneur Institute, but it has been dogged since by complaints from consumers and a few isolated civil lawsuits claiming it didn't fulfill its advertised claims.

Schneiderman's lawsuit covers complaints dating to 2005 through 2011. Students paid between $1,495 and $35,000 to learn from the Manhattan mogul who wrote the best seller, "Art of the Deal" a decade ago followed by "How to Get Rich" and "Think Like a Billionaire."

Scheiderman said the three-day seminars didn't, as promised, teach consumers everything they needed to know about real estate. The Trump University manual tells instructors not to let consumers "think three days will be enough to make them successful," Schneiderman said.

At the seminars, consumers were told about "Trump Elite" mentorships that cost $10,000 to $35,000. Students were promised individual instruction until they made their first deal. Schneiderman said participants were urged to extend the limit on their credit cards for real estate deals, but then used the credit to pay for the Trump Elite programs. The attorney general said the program also failed to promptly cancel memberships as promised.

———

Consumers may file complaints at:

www.ag.ny.gov/bureaus/consumer—frauds/filing—a—consumer—complaint.html.

Donald Trump sued by attorney general for $40M over 'Trump University'

New York's attorney general sued Donald Trump for $40 million Saturday, saying the real estate mogul helped run a phony "Trump University" that promised to make students rich but instead steered them into expensive and mostly useless seminars, and even failed to deliver promised apprenticeships.

Trump shot back that the Democrat's lawsuit is false and politically motivated.

Attorney General Eric Schneiderman says many of the 5,000 students who paid up to $35,000 thought they would at least meet Trump but instead all they got was their picture taken in front of a life-size picture of "The Apprentice" TV star.

"Trump University engaged in deception at every stage of consumers' advancement through costly programs and caused real financial harm," Schneiderman said. "Trump University, with Donald Trump's knowledge and participation, relied on Trump's name recognition and celebrity status to take advantage of consumers who believed in the Trump brand."

But Trump's attorney accused Schneiderman of trying to extort campaign contributions from the real estate mogul through his investigation of Trump. Attorney Michael D. Cohen told The Associated Press on Saturday that Schneiderman's lawsuit was filled with falsehoods. Cohen said Trump and his university never defrauded anyone.

He said Trump University provided nearly 11,000 testimonials to Schneiderman from students praising the program and said 98 percent of students in a survey termed the program "excellent."

"The attorney general has been angry because he felt that Mr. Trump and his various companies should have done much more for him in terms of fundraising," Cohen said. "This entire investigation is politically motivated and it is a tremendous waste of taxpayers' money."

State Board of Elections records show Trump has spent more than $136,000 on New York campaigns since 2010. He contributed $12,500 to Schneiderman in October 2010, when Schneiderman was running for attorney general, records show. An outspoken conservative, Trump himself flirted with a presidential run last year.

"Donald Trump will not sit back and be extorted by anyone, including the attorney general," Cohen said.

The lawsuit says many of the wannabe moguls were unable to land even one real estate deal and were left far worse off than before the lessons, facing thousands of dollars in debt for the seminar program once billed as a top quality university with Trump's "hand-picked" instructors.

Schneiderman is suing the program, Trump as the university chairman, and the former president of the university in a case to be handled in state Supreme Court in Manhattan. He accuses them of engaging in persistent fraud, illegal and deceptive conduct and violating federal consumer protection law. The $40 million he seeks is mostly to pay restitution to consumers.

He dismissed Trump's claim of a political motive.

"The fact that he's still brave enough to follow the investigation wherever it may lead speaks to Mr. Schneiderman's character," Schneiderman spokesman Andrew Friedman told AP.

State Education Department officials had told Trump to change the name of his enterprise years ago, saying it lacked a license and didn't meet the legal definitions of a university. In 2011 it was renamed the Trump Entrepreneur Institute, but it has been dogged since by complaints from consumers and a few isolated civil lawsuits claiming it didn't fulfill its advertised claims.

Schneiderman's lawsuit covers complaints dating to 2005 through 2011. Students paid between $1,495 and $35,000 to learn from the Manhattan mogul who wrote the best seller, "Art of the Deal" a decade ago followed by "How to Get Rich" and "Think Like a Billionaire."

Scheiderman said the three-day seminars didn't, as promised, teach consumers everything they needed to know about real estate. The Trump University manual tells instructors not to let consumers "think three days will be enough to make them successful," Schneiderman said.

At the seminars, consumers were told about "Trump Elite" mentorships that cost $10,000 to $35,000. Students were promised individual instruction until they made their first deal. Schneiderman said participants were urged to extend the limit on their credit cards for real estate deals, but then used the credit to pay for the Trump Elite programs. The attorney general said the program also failed to promptly cancel memberships as promised.

Donald Trump investment school sued by New York attorney general: report

(Reuters) - The New York state attorney general filed a $40 million lawsuit on Saturday against Donald Trump's for-profit investment school, Trump University, accusing it of engaging in illegal business practices, according to the New York Times.

The newspaper reported that New York Attorney General Eric Schneiderman alleged that the real estate mogul, his Trump Organization company and others made false claims about classes at the school, including that Trump handpicked instructors.

Representatives for the New York attorney general's office and Trump were not available for comment late on Saturday.

But Trump said in a post on Twitter, "Light weight NYS Attorney General Eric Schneiderman is trying to extort me with a civil law suit."

The tweet linked to a website about Trump University, which says the school has a 98 percent approval rating from students.

The New York attorney general's lawsuit seeks restitution of at least $40 million, the Times said, and it alleges that Trump University was run as an unlicensed educational institution from 2005 to 2011 and that Trump did not create the curriculum for any of the school's courses.

(Reporting by Mary Wisniewski in Chicago; Editing by Alex Dobuzinskis and Peter Cooney)

New York Attorney General Is Investigating Trump’s For-Profit School

The New York State attorney general’s office is investigating whether a for-profit school founded by Donald J. Trump, which charges students up to $35,000 a course, has engaged in illegal business practices, according to people briefed on the inquiry.

Enlarge This Image

Richard Drew/Associated Press

Donald J. Trump says students at his school want him to be more involved. A representative defended the school.

Enlarge This Image

no credit

Dozens of students have complained about the quality of Trump University, which charged up to $35,000 per course.

The investigation was prompted by about a dozen complaints concerning the Trump school that the attorney general, Eric T. Schneiderman, has found to be “credible” and “serious,” these people said, speaking on the condition of anonymity because the investigation was not yet public.

The inquiry is part of a broader examination of the for-profit education industry by Mr. Schneiderman’s office, which is opening investigations into at least five education companies that operate or have students in the state, according to the people speaking on the condition of anonymity.

The investigation is the latest problem for a six-year-old company, known until last year as Trump University, that already faces a string of consumer complaints, reprimands from state regulators and a lawsuit from dissatisfied former students.

George Sorial, a managing director of the Trump Organization, confirmed that the company had received a subpoena from the attorney general’s office, and said, “We look forward to resolving this matter and intend to fully cooperate with their inquiry.”

Mr. Schneiderman is looking into whether the schools and their recruiters misrepresent their ability to find students jobs, the quality of instruction, the cost of attending, and their programs accreditation, among other things. Such activities could constitute deceptive trade practices or fraud.

The four other companies are the Career Education Corporation, which runs the Sanford-Brown Institute, Briarcliffe College and American InterContintental University;Corinthian Colleges, the parent company of Everest Institute, WyoTech and Heald Colleges; Lincoln Educational Services, the owner of Lincoln Technical and Lincoln Colleges Online; and Bridgepoint Education, the operator of Ashford University.

Spokesmen for Lincoln Educational Services, Bridgeport Education and Corinthian Colleges each said the companies had been sent requests for information by the attorney general’s office and would comply with them.

A representative of Career Education Corporation declined to comment.

For-profit schools have become big business in the United States, especially as the unemployed seek a way back into the work force. Some of those schools, however, have been accused of creating as much economic harm as help: students have reported falling deep into debt to pay for classes that they said had failed to deliver what they had promised.

Mr. Trump’s institution is unique among for-profit schools: it is built almost entirely around the prestige and prominence of a single individual. Mr. Trump said he created the university in 2005 to impart decades’ worth of his business acumen to the general public. He aggressively marketed the school, telling students that his handpicked instructors would “teach you better than the best business school,” according to a transcript of a Web video.

The school has charged premium prices because of the Trump name, with the cost of the courses ranging from $1,500 to $35,000 each.

But, as The New York Times reported last week, dozens of students have complained about the quality of the program to the attorneys general of New York, Texas, Florida and Illinois. The Better Business Bureau gave the school a D-minus for 2010, its second-lowest grade, after receiving 23 complaints. Over the last three years, New York and Maryland have told the company to drop the word “university” from its title, saying that using it violated state education laws. (The school was renamed the Trump Entrepreneur Initiative in 2010.)

Four former students filed a suit against Trump University last year in a federal court in California, seeking class-action status. They contended that the school used high-pressure sales tactics to enroll students in the costly classes, promised extensive one-on-one instruction that did not materialize and employed “mentors” who at times recommended investments from which they stood to profit.

Mr. Sorial of the Trump Organization, which oversees Mr. Trump’s businesses, forcefully disputed those claims. He said on Thursday that 95 percent of the school’s students in New York had rated their courses as “excellent” on evaluation forms. The school’s national average is even higher, he said.

“Our customer satisfaction surveys speak for themselves,” he said.

As its troubles have mounted, the school has suspended new classes and begun overhauling its curriculum, executives said. One priority is finding a way to inject more of Mr. Trump into the program.

“The one thing is that they really wanted me involved, instead of the teachers,” Mr. Trump said in an interview last week.

In interviews, several former students said they felt betrayed by the real estate mogul and his school, especially after investing tens of thousands of dollars in what they thought was to be a comprehensive education.

“They lure you in with false promises,” said Patricia Murphy, 57, of the Bronx, who is among the former students suing Mr. Trump, whose suit makes similar claims. She said she had spent about $12,000 on Trump University classes, much of it paid with credit cards, in the hope of escaping her career as a part-time teacher and becoming a real estate investor.

Her instructors said they would introduce her to banks, help her secure loans and walk her, step by step, through deals, she recalled. “They did none of that,” she said. “I was scammed.”

Mr. Sorial said the school was looking into Ms. Murphy’s claims.

Carmen Mendez, 59, a public school teacher in Brooklyn, wrote to the Better Business Bureau in 2009 about her disappointment with the school — and with Mr. Trump. She said she had dipped into her retirement savings to pay nearly $35,000 for the classes, because “Mr. Trump is a very respectable person, and I thought that Trump University was a real institution,” she said in the letter to the Better Business Bureau.

An instructor promised her, she wrote, that the school guaranteed financial assistance to buy e real estate. But once she had enrolled, Ms. Mendez wrote, she was refused such assistance. Because her credit cards were loaded with debt to pay for the classes, mortgage brokers told her she was ineligible for a loan, she said.

“I am writing because I want people to be aware that Trump University is not a real educational institution,” she told the Better Business Bureau. “Please advise other people so they do not lose their savings in these difficult days.”

Mr. Sorial said that the school tried to offer Ms. Mendez a full refund more than six months ago. “She failed to return our numerous calls and e-mails,” he said.

A version of this article appeared in print on May 20, 2011, on page A18 of the New York edition with the headline: New York Attorney General Is Investigating Trump’s For-Profit School.

The Story behind the Utah Call Center Business Model, from City Weekly

A story of fraud, drugs, waterboarding and the call-center companies that gave Attorney General Mark Shurtleff $187,500 in 2008.

No one can really say what 51-year-old Dee Beckstead was thinking one spring evening in May 2008. Arriving early to an LDS Family Services 12-step program for recovering drug addicts, Dee sat alone in his pickup in the church parking lot. Whether he thought of family, friends or felt only the gnawing pain of the heroin addiction he’d wrestled with so desperately, no one will ever know. With less than half an hour before his support class started, though, whatever he felt or thought, he decided he didn’t want any more of it. So he placed a 12-gauge shotgun in his mouth and ended his life.

Beckstead was not a gang member or a troubled youth; he was a beyond-middleage man who happened to work, at the time of his suicide, at a call center in American Fork. Mentoring of America, a nondescript Utah County call-center company, has been described by former employees as a den of iniquity. They tell of sales people with silver tongues consulting on real-estate deals across the nation—dialing in serious dollars and partying like rock stars. Dealmakers might close a sale on a costly realestate program with an elderly couple in Florida, and on their breaks sling cocaine, OxyContin as well as marijuana brownies to their co-workers. Employees might shoot heroin up in the bathrooms or drop ecstasy while on the phone with customers.

As a former employee describes it, on payday, the sales floor would make a liquorstore run before lunchtime and by the end of the day, might be taking down customer’s credit-card information drunk, high or both.

“Dee was a victim of this industry,” says Tim Lawson, a former sales-team leader with Mentoring of America. In July 2007, Lawson brought Beckstead to the company as part of his sales team when he was hired. Lawson says Beckstead was clean when he started at MOA but soon relapsed. And while, ultimately, the actions of an addict are nobody’s fault save his or her own, some wonder how the reckless, anything-goes work environment at MOA and its impact on employees could avoid scrutiny for so long.

It didn’t.

In fact, the company has been under three separate investigations that resulted in administrative citations and one enforcement action by the Utah Attorney General’s Office, between 2004 and 2007. Not for drugs, however, but for allegations the company fraudulently promised unrealistic guarantees to customers, sold them programs they couldn’t use and otherwise conducted deceptive trade practices. These investigations were brought by the Utah Division of Consumer Protection. The last time Mentoring of America was behind the 8-ball for alleged shady business practices, during winter 2007-08—five months before Beckstead took his life—MOA stood to potentially lose its license and have to eat $113,500 in fines and statutory penalties from the Division of Consumer Protection. In March 2008, however, the charges were dismissed, and MOA dodged a bullet and paid no fines.

MOA has managed to rack up quite a legal bill, having to defend itself against consumer complaints nearly every year since it opened its doors in 2002. Owned by Doug Gravink and Gary Hewitt, the company must be making some dough to pay those attorney bills. According to former employees, MOA, through the sale of programs teaching customers how to turn a profit from home tax-lien sales, made up to $1.2 million per week. And that’s only from MOA’s Utah County location and doesn’t include numbers for the company’s operations in Nevada and California.

And while this multimillion-dollar operation might not have been paying a lot in fines, the company was investing in political goodwill. In fact, on Jan. 16, 2008, almost a month after it received its most recent charges from the state, MOA contributed $20,000 to Attorney General Mark Shurtleff’s 2008 re-election campaign. Three months after the charges were dropped by the Utah Division of Consumer Protection, Shurtleff would bank another $10,000 from the company, according to MOA’s PAC report.


While Shurtleff’s political opponents have made quite a stink about the paydayloan industry’s support of Shurtleff’s 2008 campaign, they may have overlooked an even more significant cash flow between Shurtleff and another industry: call-center marketing companies in Utah that hawk online business programs, real-estate mentoring and grant writing software among other endeavors.

In 2008, Shurtleff filled his campaign chest with $187,500 in donations from seven call-center companies—all based in Utah and six which have been investigated by the Utah Division of Consumer Protection or prosecuted by assistant attorneys general in Shurtleff’s office representing Consumer Protection. That’s not counting the actions these companies have faced from 10 other state’s attorneys general or consumer protection agencies and from investigative counterparts in Australia. Donations Shurtleff netted from these companies made up more than a quarter of his 2008 war chest.

MOA was just one of these companies. When City Weekly asked the attorney general about a possible conflict of interest in accepting donations from companies that have been the subject of state investigation, he did not respond. Instead, in an e-mailed statement, A.G. spokesman Paul Murphy denied any wrongdoing.

“Your line of questioning suggests that a candidate or official should not take any contribution if that candidate may have a future conflict of interest,” writes Murphy. “Does the Attorney General or any elected official need to check with every agency in the state before taking a contribution? Does he have to check with the state fair board, the aeronautical board, child protection services, the state board of education? Is that even feasible?”

The Fixer
Like a Mormon version of Michael Clayton—the troubled attorney turned corporate fix-it man from the 2007 film of the same name—Utah County businessman Tim Lawson says his credentials in the business world go beyond salesmanship. He says he’s also got some tight political connections he can call on to help sort out situations. One close friend, for example, is Utah Attorney General Mark Shurtleff. With the ability to offer MOA access to friends in high places, Lawson says MOA actively recruited him to join the company in 2007. He spent roughly a year at the company.

Separated from MOA since the fall of 2008, Lawson now paces about his sparse Provo office, the site of a new business he’s started which builds and markets hovercrafts. His head shaved, dressed in a brown leather jacket, Lawson’s intense gaze and quick, commanding tone would make him a dead ringer for a 1970s police detective if not for the handless headset over his ear.

“I already knew of [MOA’s] reputation, but I figured, as one of the managers, I could come in and clean it up,” Lawson says in a Jan. 20, 2009, interview. Now he believes he may have bitten off more than he could chew. “That [sales] floor doesn’t need a babysitter, it needs a roto-rooter to clean out the crap.

“People would come to work so drunk or stoned, they couldn’t hardly walk—and they’re collecting credit-card information from people all over the country,” Lawson says, “You’re talking heroin, coke, meth, every type of uppers and downers. They were even pumping out Adderall to people, OxyContin— anything you needed.”

Corine Cyphers was featured in a Jan. 21, 2009, City Weekly article about a discrimination claim filed with the Utah Antidiscrimination and Labor Division against MOA. In a Jan. 8 interview, she told City Weekly that management was more interested in results than office behavior. “[Management] made it a free-for-all as long as the job was done,” Cyphers says. “Go to work, party and then leave. The supervisors knew about it.”

This dope-fueled sales environment made for an unusual workplace, Cyphers said. Cyphers described employees toting Nalgene bottles full of vodka, and people passed out at their desk. Both Lawson and Cyphers said employees overdosed while at work.

These claims are consistent with documents City Weekly obtained through an open-records request. On July 7, 2005, the American Fork Police Department responded with multiple officers and medical personnel to a call of multiple overdoses at MOA’s location. Investigating officers discovered five employees in need of medical attention after having passed around a bottleful of gamma-hydroxybutrate or GHB. A drug with many street names such “Liquid X” and “Grievous Bodily Harm,” it is known both as a drug of the rave scene as well as a potent date-rape narcotic. Three victims had to be rushed to the emergency room of the American Fork Hospital.

The police report indicates several employees saying the incident was illustrative of a larger problem. One overdose victim told an officer “there is a serious problem with drugs being taken by employees at Mentoring of America.” The employee identified as the alleged dealer from this incident was subsequently fired by the company and arrested and booked into jail for narcotic possession, distribution and four counts of reckless endangerment.

But as recently as June 24, 2008, the American Fork Police Department again accompanied an ambulance to MOA’s worksite. The responding officer noted that the medical team identified a 32-year-old male employee who appeared to be suffering from an overdose “of Soma, Ultram and possibly Cocaine.”

“They follow the philosophy that the more money they make, the bigger the toys and the more drugs they can get,” Cyphers said in her January 2009 interview. Lawson says employees were making a killing off selling a computer program teaching customers how to make money off real-estate tax-lien sales. Team leaders like Lawson easily pulled in over six figures a year. “These kids are bringing down serious money and have no accountability,” he says. MOA was an amped-up sales powerhouse, according to Lawson and Cyphers, pulling in roughly $1.2 million in sales—a week. Other former employees, confirm the company’s drug culture, at least for the period between 2002 and 2005.

“Some guys there made $35,000 a week,” says salesman X, a former employee who asked to remain anonymous. “A lot of that just went down the drain with drugs.” X says numerous drugs were sold and available and people had connections to street drugs like ecstasy and heroin, but he says, for the most part, prescription drugs were the narcotics of choice: OxyContin, Lortab, Percoset—even a combination of all three they called “legal speedballs.” X says these prescription-drug cocktails were like performanceenhancing drugs for the sales team. He says the mindset of using while at work was, “I’m going to [work] for 12 hours; I won’t feel rejection, I won’t feel pain. I’ll be patient with the people on the phone. [The drugs] give people the ability to mold and mirror people on the phone and basically take their money.”

Salesman Y, also a former employee who asked to remain anonymous, remembers getting a Lortab from a supervisor once for a headache, “Pretty soon he was selling them to me wholesale,” Y says.

Since June 2008, there have been no new reported incidents regarding drug usage with the American Fork Police Department.

Besides hoping to crack down on drug use on the floor, Lawson says he was also working doubleduty making sure telemarketers weren’t breaking telecommunication law. “There are people that lie openly on the phone. There are people who overpromise. I’ve personally sat there and heard people say ‘Oh, I guarantee you will make $150,000 in your first two months,’” Lawson says. “That’s illegal! You can’t say that.”

If you have any comments regarding this article, please send them to investigations@seminarwatch.com



Y remembers behavior like that from his time at MOA as well, even remembering a sales person who promised a woman over the phone that since she didn’t have a computer, that if she would just send him a check for $2,000, he would buy her a top-ofthe-line computer and mail it back to her. Y claims the salesman got the check, cashed it, kept the money and never sent the woman the computer. “And this was some old lady on disability,” Y says.

According to Consumer Protection records, since 2002, MOA has given a total of $2,459,383 in refunds to victims who complained to the division. MOA also has been in the Utah Division of Consumer Protection’s crosshairs on four separate occasions during the period 2004-07. The first time was in 2004, for violations of the Telephone Fraud Prevention Act including denying refunds, operating without a permit and failing to notify customers of their three-day cancellation rights. MOA settled and had a potential $19,500 fine knocked down to $2,000 so long as they refunded all the complaining consumers and promised to clean up their act.

In 2005, MOA was cited again by Utah Division of Consumer Protection for 23 counts of fraud for the exact same violations as in 2004, including deceptive trade practices and violations of the Telephone Fraud Prevention Act for failing to notify customers of their cancellation rights. In settlement of a potential fine of $36,500, MOA avoided having its license revoked and agreed to pay a $10,000 administrative assessment under the condition it amend its practices. If the company violated the terms of the agreement in the future, the company would owe the division an additional $53,500. It also had to “resolve and refund” the newest batch of 23 complaining consumers who, in total, were owed $180,490 for programs they couldn’t use or weren’t what they were promised.

Yet in 2006, the Attorney General’s Office, which enforces compliance for administrative actions issued by the Utah Division of Consumer Protection, had to bring civil action against MOA for failing to meet its obligations to refund the 23 complainants from the 2005 case. Nineteen of the 23 were given no refunds, others were given partial refunds and told it was a “take it or leave it” situation, according to the legal complaint. The state then demanded MOA pay full refunds at around $199,950 as well as administrative fines of $163,000.

In settlement, MOA paid a $25,000 fine, agreed to reform its practices and stop making false and misleading statements, and agreed that if it screwed up again, a judgment would be entered against MOA in the sum of $53,500 without further hearing, and MOA would be subject to additional fines.

Like a case of bad déj-vu, less than a year later, in December 2007, MOA was served with another administrative citation for 24 counts of allegedly violating the Telephone Fraud Prevention Act and for other deceptive practices. This time, MOA had switched it up a bit. According to division allegations, MOA sales representatives were still making deceptive and misleading promises about the program to customers. But now, after making the sale, sales representatives would pass the customer over to an inhouse compliance department. Before transferring the customer over, the salesperson would say that as a formality, the customer needed to tell the compliance agent that the salesperson hadn’t promised the customer outlandish earnings.

Overlapping this timeline enters a new star to the MOA team: Tim Lawson.

“People always call me to use me for my connections,” Lawson says. “I don’t know that people generally like me, but I know they like the people that I know. So I’ve had multiple people call me on multiple occasions, including the owners of MOA, calling me to try and use my connections to cover their ass,” Lawson says. “But at no time have I ever used my relationships to be compromised.”

“Two days out of [knee] surgery, on a Sunday evening and during a huge snowstorm, [MOA] called and said they were in big trouble. That the Division of Consumer Protection, Francine Giani was gonna file a cease-and-desist order and close their doors. And they wanted me to help out,” Lawson says. In the following months, he says, he lobbied Consumer Protection on behalf of MOA, and a settlement was reached.

The 2006 agreement had provided for a $53,500 judgment to be entered against MOA, which—combined with the new charges that added another $60,000— made a total possible judgment of $113,500. Yet, under MOA’s latest settlement, it paid no fine, and no judgment was entered. The company actually fared better than the first time it crossed with the division in 2004 when it was fined $2,000. To make a baseball comparison of MOA’s track record since 2004, the company had four strikes against it, and it walked a base.

Lawson says he tired of being the company’s fix-it man, especially as company problems persisted. A pivotal moment came with the suicide of his friend and colleague, Dee Beckstead. Lawson says he had been unaware of an employee at MOA who moonlighted as a drug dealer and had been fired several times previously but was continually rehired. This individual, Lawson claims, facilitated Beckstead’s relapse into heroin.

“If there would have been a drug policy, a one strike, you’re out, zero tolerance policy, [the dealer] wouldn’t have been there,” Lawson says. While he doesn’t hold MOA responsible for Beckstead’s suicide, he also doesn’t see it as blameless. “Now is [Beckstead’s suicide] MOA’s fault? No. But do they have some culpability? Absolutely. Because they allowed that type of environment to be fostered there.”

In a meeting, Lawson says he challenged the MOA management on the issue. Lawson said one of the managers admitted he didn’t care if employees used recreational drugs, “that he himself likes to do an occasional drug, light up a joint now and then, this that and the other,” Lawson says. “I was like, ‘You know, this is not a company I want to work for.’” Despite numerous attempts to contact company executives, MOA representatives would not comment for this story.

Lawson left the company in the summer of 2008 and took with him all his connections. Lawson says he regrets having introduced MOA management to Shurtleff. Now, having moved on, Lawson went to Shurtleff in the fall of 2008 and told him the extent of the drug problem.

“I’ll go on the record on this: Shurtleff is a man of honor, with impeccable integrity and the honesty of Abe Lincoln,” Lawson says. “He did not know all the stuff about MOA.”

So, Lawson says, as the truth came out, Shurtleff in January 2009 returned MOA's two campaign-donation checks, one for $20,000 and another for $10,000.

“Which I think is impressive, personally,” Lawson says with the utmost sincerity. “No politician gives money back, because he’s not a politician, right guys? He’s a statesman!”

The Reports
Shurtleff did return $30,000 he received from MOA’s Political Action Committee, according to Shurtleff’s 2008 campaign finance disclosure reports, but he still kept $2,500 he received from MOA’s corporation.

The only public record of the $30,000 donation comes from MOA’s 2008 Year-End PAC contributor report. Shurtleff’s report does not mention the receipt of either donation. There’s no indication of the $30,000 at all. According to the State of Utah Lieutenant Governor’s Office which warehouses candidates’ campaign finance filings, without speaking to the specifics of this incident (since no complaint has been filed the office has not investigated) the missing expenditure on the report means either Shurtleff never reported receiving the money or he went back to the electronic report filing and deleted any note of ever receiving the money.

According to Joe Demma, chief of staff for Lt. Gov. Gary Herbert, there is only one office that can really investigate and enforce compliance for negligent campaign finance filings—the Attorney General’s Office.

The effect of money on a candidate is difficult, if not impossible, to measure. In relative terms, most campaigns are very expensive, especially statewide campaigns. In his written response to City Weekly, attorney general spokesman Paul Murphy made these points in response to concerns of conflicts of interest. “What you are proposing would only allow people with deep financial pockets to run for office. Your approach also takes away the rights of companies and individuals to give to the candidate of their choice,” Murphy writes.

Yet, when asked why—if there were no conflict of interest with MOA—did Shurtleff return $30,000 in campaign donations from MOA, spokesman Murphy said that the $10,000 check was a typo on MOA’s report. As for returning the $20,000, Murphy writes via e-mail: “For reasons unrelated to Consumer Protection or unsubstantiated allegations of drug abuse, the Attorney General sent a $20,000 check back to MOA and removed $20,000 from his report.”

The Web
So, for a candidate like Shurtleff, who raised $680,546 in 2008, MOA’s donation makes up a small chunk of that change. But from the call-center telemarketing industry in Utah, Shurtleff pulls in $156,000 in donations for 2008. Counting the allegedly returned MOA checks: $187,500.

These companies weave together a large web of money and legal actions. Several have multiple company names and most are interconnected, sharing client information so different companies can offer the same client additional services (see diagram, p. 20). There is even one infamous complaint of one company using waterboarding as a motivational exercise.

Prosper Inc., located in Provo, gained some notoriety on Feb. 28, 2008, when The Salt Lake Tribune reported that former employee Chad Hudgens had sued his former supervisor for using a method of torture on him that dates back to the Spanish Inquisition as part of a company exercise. The tactic induces psychological trauma by convincing the body it is drowning. Hudgens alleged his boss waterboarded him, explaining to watching employees that they should put the same amount of struggle into making sales as Hudgen’s body did as it struggled for air. Prosper, which markets business coaching to customers in areas such as real estate, investing and Web commerce also donated $15,000 to Shurtleff in 2008. Despite repeated attempts to contact representatives of Prosper, City Weekly was unable to obtain comments about an administrative citation issued against them by the Utah Division of Consumer Protection in 2007 for deceptive trade practices.

Another company that donated to Shurtleff, Storesonline, which markets a service selling and hosting online-business Websites, has been named in two individual lawsuits and settled eight actions with various state attorneys general from California to North Carolina. It is also facing two pending actions in the United States and one in Australia. The 2007 pending case with the Australian Competition and Consumer Commission comes only a year after Storesonline settled with the country in 2006. In that agreement, the company promised to stop making false and misleading statements and agreed to refund 175 Australian consumers a total $673,478.

That amount barely edges out a California settlement where Storesonline agreed to pay fines and restitution to the tune of $550,000 in 2006. In all of the company’s settlement arrangements, Storesonline agreed to amend its business practices. Yet documents show between 2003 and 2008, the company has been fined and/or ordered to offer restitution for a combined sum of $2,194,289, an average of roughly $440,000 in fines and restitution owed per year.

General counsel for Storesonline Jeffrey Korn says that the company had a recent change in management in November 2008, and that previous management considered its $15,000 in political donations to Shurtleff in 2008 as part of being good corporate citizens. “Current management does not believe that and won’t be making any charitable or political donations,” Korn says. He says the company does not consider that an appropriate use of shareholder funds. “And personally, I wouldn’t have done it,” Korn says, because of the possibility of a perceived conflict. He adds that in his dealings with the state there has never been any significant contact with the Attorney General’s Office. “The negotiations and the complete settlement were done between me and [Consumer Protection] with no input from the Attorney General’s Office.”

Korn confirmed Storesonline’s relationship with other Shurtleff donor companies Professional Marketing International (PMI) and the Tax Club as companies that sell products to Storesonline customers. The Tax Club, a call center that sells business tax plans, donated $40,000 to Shurtleff in 2008. They were also subject to Consumer Protection citations for deceptive trade practices in 2007. Despite repeated attempts, to contact representatives of the Tax Club, City Weekly’s calls for comment went unanswered. PMI, aka National Marketing Resources, which gave $10,000 to Shurtleff in 2008, is a company offering real estate coaching and helps market Storesonline software. PMI has faced no citations or actions from Utah Consumer Protection. PMI President Phil Smith says its donations were only a show of support and that the company had likewise donated to several other races and causes in the state. “There was never any conflict of interest,” Smith says.

Jeremy Johnson, president of iWorks, a company that gave $50,000 to Shurtleff in March 2008, didn’t believe he was buying any favors, either. “[Shurtleff] is a guy that we like and believe in and there’s nothing else to it,” he says. In 2007, Johnson’s company, which markets products to assist customers in obtaining government small-business loans, was prosecuted by the Attorney General’s Office on behalf of the Division of Consumer protection for deceptive trade practices. The charges were dismissed in early 2008.

“We handle clients for a dozen companies with a 150,000 new customers every week. A certain percent complained to Utah’s Consumer Protection, and they decided to take action,” Johnson says. Besides, “Their own lawyers told them if they took it to court they’d lose, so they dropped it.”

Of course, Consumer Protection’s own lawyers are by statute, from the Attorney General’s Office.

The Alliance
In relation to the iWorks campaign donations, the AG’s office’s Murphy pointed out inaccuracies in a June 19, 2008, City Weekly story titled "The $50,000 Question." The story incorrectly stated that members of the Attorney General’s Office participated in the investigation of iWorks. “Three assistant attorneys general have been involved in representing [Utah Consumer Protection] in matters relating to that investigation, but their role has always been as legal counsel, not as participants in any investigation,” Murphy writes.

Murphy says, however, that the decision to dismiss the 2007 case against iWorks was one decided “independently” by Consumer Protection, writing that while his staff worked with Consumer Protection on the issue, “The Attorney General had no input and no communications with Consumer Protection about this decision.”

Murphy says the Attorney General’s Office collaborated with a number of these businesses as well as the Consumer Protection Division to formulate a best-practices policy for dealing with complaints as part of a new industry association called the Alliance for Lifelong Learning.

“The attorney general does not have a relationship with these companies and has not been involved with any complaints that may have been made in the past. They all have compliance and complaint policies and should respond and refund money if there is a problem,” Murphy writes. “Some of these companies have not always been as prompt at responding, but it is hoped that this new association will provide better support for consumers.”

While the dismissal was Consumer Protection’s ultimate decision, Murphy notes the attorney general’s advisory capacity in how the division proceeded with the case. “In its role as counsel for the Division in proceedings involving Mentoring of America, the Attorney General’s Office represented the interests of the Division and had various internal discussions, prepared legal papers and had attorney-client communications.” Attempts by City Weekly to gain access to records of these internal documents and discussion records have been denied by the Attorney General’s Office, citing the legal standard of government privacy.

“Many companies are very legitimate and doing great work,” says Bill Nixon, executive director of the Alliance for Lifelong Learning, the trade association created with mostly Utah County call-center companies in January 2008. “But this is an industry where you also have fly-by-night, boiler room operations.” Nixon hopes that the association will be able to regulate its industry much like many other national industry associations by requiring members to adhere to strict standards of practice. Nixon says in the association’s first year it has already established a system to resolve customer complaints within roughly 48 hours. “The successful [complaint] closure rate is almost 100 percent,” Nixon says, adding that he still has concerns.

“If a company gets 30 complaints in a quarter,” Nixon says, “there may be 3,000 other unsatisfied customers who just don’t complain.” For him, the Alliance can’t simply be a paper tiger. “It’s not enough in my mind that we just meet the consumer’s expectations and thoughtfully and compassionately address their concerns. What we really want to do is improve the behavior of anybody who might be working in this industry. And if they don’t improve, they’ll be moved out of the association.”

According to Francine Giani, director of the Utah Department of Commerce—the state agency that houses Consumer Protection, the new association, while helping to resolve complaints won’t affect how the division acts on its investigations. “Citations will still go out,” Giani says, if companies display a pattern of negligent or criminal behavior. “We’re not heavyhanded here. I think we have to balance on [whether we can] correct the business’ practice to bring them in line or will they never learn?” But both Giani and Consumer Protection Director Kevin Olsen, agree the association is helping to resolve complaints. “If self regulation by the industry is the first step, that makes government regulation a lot easier,” Olsen says.

Giani did not see Mentoring of America as a driving force behind the association’s founding. “In fact it’s my understanding that they were the last to jump on board,” Giani says.

Regarding Consumer Protection’s waiving of MOA’s fine in 2007, Giani explained that consumers’ refunds might have been jeopardized by a protracted court battle. “We believe our first priority is to refund the consumers and not fund the coffers for the state,” Giani says.

Olsen notes the industry association is still in its infancy. “I think the alliance gave us a new tool,” he says. “We’re waiting to see if it’s the tool we really hope it is".

The Candidate
Marcus Aurelius, ancient Rome’s philosopher king, once wrote: “That which is not good for the beehive, cannot be good for the bees.” Utah Federal District Court Judge Paul Cassel would echo that statement in a legal opinion some two thousand years later.

Storesonline had sought an injunction against the Division of Consumer Protection to halt a 2007 administrative citation against it by arguing that the division lacked jurisdiction since complaining customers did not reside in Utah. Judge Cassel denied this argument and dismissed the company’s motion. Explaining why a company like Storesonline could potentially damage Utah even though the complaining customers were from outside the state, he wrote: “The state has an interest in protecting consumers against the harms of unchecked, exploitative businesses that are centered in Utah. And the state has an interest in preventing Utah from obtaining a reputation as being a haven for such businesses.”

Thus, the state helps bolster its image when it protects consumers from deals too good to be true, even consumers from out of state.

It protects consumers such as John and Claire Patrick, a retired couple from Tucson, Ariz., who complained of software and services they purchased from Utah County call-center company The Summit Group in 2007 for $8,000, meant to help them set up an online business site. Claire documented the return of all the materials the company charged her for, and luckily, her credit card company stood by her and canceled the charges. She also demanded a refund and pointed out to Summit that her husband—who had bought the program— was manic-depressive. According to a 2008 Division administrative citation against The Summit Group, John Patrick had even become suicidal when he learned the com pany would not refund the full amount— even after Claire Patrick told them about her husband’s condition. Claire Patrick says, however, that after she talked to the Utah Attorney General’s Office about her husband’s condition and Summit’s behavior, the full amount was soon refunded.

The Summit Group and another call center, Thrive Learning, both under the management of Colton Moody and Eric Largin, donated $25,000 to Shurtleff’s campaign in 2008.

“We were luckier than most,” Claire says. “Apparently, they kind of go after retired folks like us and maybe people with mental situations like my husband,” she says. “They kind of prey on folks.” Despite repeated attempts, representatives of the Summit Group could not be reached for comment.

For Donna Croninger, who works in foster care in Deshler, Ohio, documenting everything and complaining loudly to as many government entities as possible also helped her recoup roughly $8,000 from Mentoring of America in 2007. Still she was embarrassed for getting involved in the first place.

“It was stupidity on my part, I know that. But they said you’re making your money back. … You get promised things that aren’t there,” Croninger says. She’s grateful she got her money back and besides the abovementioned advice, she could recommend two other tactics that worked for her: “I cried and prayed,” she says.

If you have additional comments regarding this article or are a victim of one of these companies, please contact Western Capital at investigations@seminarwatch.com . Special thanks to City Weekly for this story.