The Federal Trade Commission and the Securities Exchange Commission are in the process of trying the cases of several entertainment and media companies who are being charged with “investment opportunity” scams. The investigation has focused on 66 companies who are accused of defrauding investors of $43 million.
The scams range from promotions for production of infomercials to a plan for an Internet gambling casino, according to statements issued by the FTC.
One company which appears several times on the list of targeted firms is Affordable Media, Las Vegas, which is the parent company of Sterling Multi-Media, and two media sales companies called Financial Growth Consultants, San Diego, and Venture Capitalization, Denver. Several of Affordable Media’s subsidiaries are included on the list of 66 targeted companies.
“[The FTC] lawsuit focuses on Affordable Media,” said Gregory Ashe, an attorney for the FTC’s Bureau of Consumer Protection. “They were selling media time to consumers and promising fabulous returns in a short period of time.”
Ashe said some offers Affordable Media was promising guaranteed 50 percent returns in 90 days.
“On an annualized basis, after they took out their commission which they did not disclose, they were promising returns of 1,000 percent. This is just false,” he said.
The investigation has been ongoing since April 28, but has been hampered by the disappearance of Eric Stein, one of the operators of Affordable Media’s Sterling Group. Ashe said Stein is missing and there is a warrant out for his arrest.