The Federal Trade Commission settled a lawsuit yesterday against a man the agency accused of using deceptive telemarketing calls to dupe investors into losing money on foreign currency speculation.
Michael Zelener and his companies Amgine Corp. and Markham & Co. — both of which were based in Nevada and did business as British Capital Corp. — agreed to avoid future violations as part of the settlement. Both of Zelener's companies closed in June 2003 because of a lawsuit filed by the Commodities Futures Trading Commission, the FTC said.
Telemarketing agents hired by Zelener made misrepresentations when telling consumers they could make large amounts of money by opening accounts with AlaronFX, a subsidiary of a Chicago currency trading company, the FTC said. The agents told consumers that traders and analysts would professionally manage their accounts, that they would get monthly statements and that funds from their accounts would be available within 48 hours, according to the FTC.
The agents also told consumers that Zelener's operation would make no money unless they did. However, AlaronFX, which was not named in the FTC's suit, paid the operation for every trade it solicited, totaling $1.4 million, the FTC said. Consumers lost $1.46 million.
Most of the consumers targeted by Zelener were retail investors, the FTC said. Foreign exchange investors typically are large investors who trade in foreign currency to balance the risks of their other investments.
Scott Hovanyetz covers telemarketing, production and printing and direct response TV marketing for DM News and DMNews.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters
