Court Orders Work-at-Home Marketer to Pay $16.5M

A federal judge in Los Angeles ordered Medicor, a company that marketed work-at-home opportunities through direct response print ads, to pay $16.5 million to provide restitution to consumers, the Federal Trade Commission said yesterday.

The FTC sued Medicor in March 2001, claiming the Van Nuys, CA, company scammed about 40,000 consumers from 1999 to 2001 with promises that they could work from their home computers and earn up to $1,500 a week by processing medical bills for doctors. Consumers paid $325 to $495 for Medicor's software packages, according to the FTC.

Medicor advertised in local newspapers and targeted stay-at-home parents, disabled people, non-English speakers and others who could not obtain secure employment outside the home, the FTC said. The FTC charged Medicor with misleading consumers who called in response to the ads by exaggerating how much money they stood to make and telling them refunds would be available, when they were not.

A permanent receiver has been assigned to distribute the company's assets among consumers who have filed claims for restitution. The amount of money that will be available has not yet been determined, the FTC said.

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