Following a lawsuit by the U.S. Federal Trade Commission, a federal court issued a temporary shutdown order for a business opportunity scheme run by Automators, which had attracted $22 million in investments from consumers with false claims of substantial income and profits. A court order has temporarily suspended the operations of Automators AI, which claimed consumers could achieve significant returns on investment via artificial intelligence-boosted stores on Amazon.com and Walmart.com, according to an Aug. 22 news release.
“The defendants preyed on consumers looking to provide for their families with promises of high returns and the use of AI to power such returns,” Director of the FTC Bureau of Consumer Protection Samuel Levine said in the release. “Their lies caused consumers to lose tens of thousands of dollars, with many losing their life savings. The FTC is working to hold defendants accountable and to secure redress for their victims.”
The lawsuit revealed Automators, previously known as Empire and Onyx Distribution, enticed individuals by promising high returns as "passive investors" in profitable online stores. Additionally, Automators claimed to employ AI to guarantee success and profitability for investors, the release reported.
The FTC's complaint names defendants Roman Cresto, John Cresto, and Andrew Chapman, as well as their associated companies Automators AI, Empire Ecommerce and Onyx Distribution. The complaint alleges the majority of clients did not realize the promised earnings or recover their investments, the release said.
Instead, most experienced significant losses, as Amazon and Walmart frequently suspended or terminated the stores operated by the defendants due to policy violations. The complaint asserts the defendants employed deceptive tactics to mislead consumers, making false claims about their backgrounds, success rates, lavish earnings projections, AI utilization and venture capital backing, according to the release.
Numerous clients who suffered losses reportedly complained to the defendants, only to receive new online storefront offers on different platforms instead of refunds. Furthermore, the complaint alleges defendants pressured these clients into signing non-disparagement agreements to prevent them from sharing negative reviews about the defendants and their services, the release said.
The FTC's complaint argues the defendants violated the FTC Act, the Business Opportunity Rule and the Consumer Review Fairness Act. The FTC is seeking a permanent shutdown of the company's operations through the court's intervention, according to the release.
