On November 27, 2023, a delivery worker was spotted in San Francisco transporting Amazon packages. The Federal Trade Commission has initiated legal action against an e-commerce company accused of deceiving consumers with a “passive income” scheme. This scheme involved setting up Amazon storefronts on behalf of customers and promising unrealistic returns surpassing those of the stock market.
The FTC filed a lawsuit on Tuesday against the company named Click Profit, as well as its co-founders Craig Emslie and Patrick McGeoghean, and two other associates. The lawsuit seeks to temporarily prevent the parties from conducting any business activities. This case is part of the FTC’s ongoing efforts to crack down on e-commerce companies offering “automation” services. These companies manage online stores for clients who pay for the service with the expectation of earning substantial passive income. However, many consumers end up losing money despite the companies’ lofty promises.
Click Profit, also known as FBALaunch, Automation Industries, and PortfolioLaunch, assured investors of building highly profitable e-commerce stores on platforms like Amazon, Walmart, and TikTok. The company charged consumers between $45,000 to $75,000 for initial investments, along with additional fees for inventory. Click Profit allegedly took up to 35% of the profits generated by their customers’ stores.
The company touted its services as a secure and proven method to generate wealth, using marketing materials that showcased successful Amazon storefronts and exaggerated claims of earnings. Click Profit falsely boasted about partnerships with reputable brands like Nike, Disney, Dell, Colgate, and Marvel. They claimed to have invested in advanced AI technologies to identify lucrative products, which they stated had generated millions in sales.
In reality, the FTC revealed that Click Profit’s AI technology and brand partnerships were fabricated, and the promised earnings were never realized. Amazon took action against about 95% of Click Profit’s stores due to violations of seller policies. Additionally, more than one-fifth of the company’s stores on Amazon failed to generate any revenue, while another third earned less than $2,500 in total sales after deducting Amazon’s fees.
According to the FTC, many consumers suffered financial losses and hardship due to Click Profit’s actions. Victims were often unable to recover their investments and were left with credit card debt and unsold products. Click Profit reportedly refused to provide refunds and even threatened legal action against those who shared their negative experiences publicly. One consumer, who invested his life savings in Click Profit, was cut off as a client without any return on his payments. When he posted a negative review online, he was allegedly threatened with a lawsuit by Emslie’s attorney. The consumer eventually took down the reviews and asked for a partial refund, only to be met with a dismissive response from Emslie.
The FTC accused Click Profit of violating various laws and seeks to permanently ban the company from operating. Representatives for Emslie and Click Profit have not yet commented on the allegations.
