The US Federal Trade Commission suspects an investment training and education firm called ‘Online Trading Academy (OTA) of fraudulent activities. The California-based entity, headed by former Israeli intelligence officer Eyal Shachar, organizes training and interactive workshops on investing in the stock and currency markets.
In the opinion of the FTC, the odds organized by OTA offer useless knowledge for inadequately high rates, accusing it of fraudulently collecting more than $370 million from consumers over a six-year period.
Online Trading Academy is a provider of financial education, offering web-based courses under the guidance of over 120 instructors. The Irvine-based day-trading academy has come under fire after the FTC accused its operatives of misrepresenting many facts about their business.
More specifically, the retirement-age students were told that OTA instructors would teach them how to “invest like the pros on Wall Street,” regardless of their background and prior experience. Other claims include that they will be taught how to find “low-risk, high-potential investing opportunities” by applying a “patented strategy’ to any asset class, including stocks, options, futures, and currencies.
Quality is very doubtful, while prices are extremely high
To lure consumers into paying up to $50,000 per class, salespeople told their prospective students that signing up for OTA’s training and related services is likely to generate substantial income.
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The watchdog has stated many examples that allegedly show how the academy used misleading advertising schemes. While OTA does not track the trading results of its customers, one of its promotional videos on YouTube featured a retiree who purportedly earned “a retirement income that was bigger than his income while he was working,” including $40,000 in a single trade. Another testimonial from a purported OTA customer stated that “It took me 18 years to develop a decent salary. After three months here at OTA, I’m making almost as much money as my business.”
The watchdog further alleges that OTA employees’ earnings claims themselves were false or unsubstantiated.
The FTX added that in numerous instances, when dissatisfied customers requested refunds from OTA, they were forced to sign agreements barring them from posting negative reviews about its services. The form also prohibits purchasers who asked for their money back from notifying law enforcement agencies and forbids “negative” comments on any blog, internet chat room, or website, including all forms of social media.
“It is illegal to make earnings claims in marketing investment opportunities or training, unless the seller has a reasonable basis to make such claims,” said Andrew Smith, the Director of the FTC’s Bureau of Consumer Protection.