The Federal Trade Commission (FTC) announced that a company located in West Hollywood was involved in fraudulent activities while posing as a provider of AI services. The fraud was orchestrated by three individuals, Andrew Chapman and brothers John and Roman Cresto, who allegedly defrauded clients of millions of dollars by promising to enhance their online retail businesses on platforms such as Amazon and Walmart.
In August, the FTC responded by imposing a temporary restraining order and freezing the assets of the firm. The accused had set up various enterprises including Automators AI, Empire Ecommerce, and Onyx Distribution, guaranteeing clients monthly returns of 8 to 20% through the deployment of artificial intelligence. Contrary to their claims, they swindled approximately $22 million from customers by providing false information regarding potential earnings and profits.
The fraudulent scheme operated under the name Empire LLC and enticed clients with automated ecommerce store packages which required an initial investment between $10,000 and $125,000, plus additional working capital ranging from $15,000 to $80,000. Despite promises of substantial monthly profits through the application of AI machine learning, most investors did not see any return on their investment, accumulating debt and facing the suspension and closure of their online stores due to policy infringements, which also led to a prohibition from selling on those platforms.
Roman Cresto, who had a substantial following on Instagram, utilized social media to foster trust and lure potential clients, showing off a wealthy lifestyle funded through the fraudulent operation. The FTC has now denounced the AI services offered as a scam, issuing a cautionary note on the potential for AI technology to be used in fraudulent activities.
As his students can attest, Roman has built his brand on true grit and determination; words that are often lacking in the sales pitch of your average “ecom guru.” Yahoo finance in 2020 😂
A fool and his money are quickly parted.