RALEIGH, N.C. (Legal Newsline) - North Carolina Attorney General Roy Cooper announced on Monday that four candy sales companies and a California company that allegedly mailed questionable letters to businesses have been barred from doing business in the state.
The Beacon Project, Creative Marketing Solutions, Universal Placement Services and Marilyn Broerman of Charlotte allegedly sold plastic countertop candy dispensers and instructed people on how to start their own candy vending businesses. The companies allegedly convinced consumers to invest as much as $50,000 by stating that investors could make $3,000 a week in cash indefinitely. None of the vendors made the types of profits that were promised.
The four candy sales companies allegedly told vendors that the money collected would go toward finding missing children. All candy sales profits allegedly went to the individual vendors while dispenser sales went to the defendants.
"It's bad enough to promise unrealistic profits, but even worse to claim the money is going to help a charity," Cooper said.
Under the terms of a consent judgment signed by Superior Court Judge Robert H. Hobgood, Marilyn Broerman, Universal Placement Services, Creative Marketing Solutions, the Beacon Project and their employees are permanently barred from engaging in unfair business practices, soliciting charitable donations and offering business opportunities in the state. The defendants must pay $5,000 to the state for the purposes of consumer protection.
Cooper filed a lawsuit against the defendants on Feb. 28, 2011, for alleged deceptive and unfair trade practices and sought a permanent ban on their work.
"Don't be fooled by profits that sound too good to be true, no matter how much you want to believe them," Cooper said. "Before you agree to buy into any business opportunity, check it out thoroughly."
Corporate Services Inc., a California company, allegedly sent questionable letters to hundreds of businesses in the state in violation of an earlier agreement. Despite a March 2011 settlement that barred the company from sending misleading mailings, the company allegedly sent out another mailing to hundreds of North Carolina businesses in violation of the settlement.
Cooper and Secretary of State Elaine F. Marshall filed a lawsuit against Corporate Services Inc. and Selwyn J. Monarch, the company's owner, in 2009 for allegedly misleading state businesses into thinking that they failed to comply with state laws on filing and taking corporate minutes.
The letters appeared to come from a government agency and directed the companies to pay $125 and give information on their corporate minutes by a particular date, Cooper alleged. The state won a preliminary injunction and a temporary restraining order against the defendants which led to the March 2011 settlement.
"Trying to trick small business owners and violating legal agreements aren't the way to do business in North Carolina," Cooper said. "We're pleased that we've kept hundreds of businesses from losing money to this scheme, and put a stop to this activity in North Carolina for good."
Corporate Services Inc. initially claimed that the latest mailing was sent by mistake but agreed to return checks worth approximately $90,000 to the 700 state businesses that responded to the mailing. Under the terms of an agreement, the company will stop doing business in the state and will pay $30,000 to the state. In the March 2011 agreement, Corporate Services was ordered to pay $25,000 to the state.