AG Paxton’s Office, FTC Team Up to Stop Scams Against Small Businesses

AUSTIN June 18, 2018 ⎯ Attorney General Ken Paxton today announced that the Consumer Protection Division of his office took legal action against three companies, including a Houston-based labor poster operation, as a part of the Federal Trade Commission’s law enforcement sweep targeting scam artists who attempt to defraud small businesses.

Operation Main Street resulted in a total of 24 actions nationwide against individuals or companies accused of ripping off small businesses. The collaborative effort included participation by the offices of seven other state attorneys general, the Better Business Bureau and two U.S. attorneys’ offices, among others.

Last Friday, Attorney General Paxton obtained a temporary restraining order and asset freeze against Corporate Compliance Solutions, which solicited small businesses with warnings of their need to comply with federal labor laws. It tricked business owners into thinking they needed to buy an $84 labor law compliance poster or would face fines and possible imprisonment. 

In addition, Attorney General Paxton’s office:

  • Obtained a permanent injunction and restitution order against American Advertising Concepts. The company sold advertising space on dry erase boards to small business owners nationwide by falsely claiming affiliations with schools and apartment complexes.
  • Filed a lawsuit against Solvera, which duped individuals into paying thousands of dollars by falsely leading them to believe it could improve a business’ reputation in internet search results.

“My office is proud to partner with the FTC in Operation Main Street,” Attorney General Paxton said. “Small businesses in Texas and across the nation are the cornerstone of the economy and deserve to be treated honestly and fairly. Our Consumer Protection Division will continue to crack down on scam artists who take advantage of small businesses through fraud and deception.”

Last October, the FTC awarded Attorney General Paxton’s Consumer Protection Division its Partner Award in recognition of outstanding work to combat fraud and deception in the marketplace.

At a news conference in Washington, D.C., the FTC unveiled a new report on small business scams that provides new insights into how fraud affects small businesses. In addition, the FTC and the Better Business Bureau announced the availability of new education materials to help small business owners and their employees avoid, identify and report scams. 

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