Fake Testimonials Nail Company. FTC Watching.

And here is why debt relief websites should not use fake consumer testimonials. This just out today from the FTC.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

Damon Day - Pro Debt Coach

The Federal Trade Commission has charged Russell Dalbey, the CEO and founder of the company behind the “wealth-building” program “Winning in the Cash Flow Business,” with defrauding consumers, in some cases out of thousands of dollars, with phony claims that they could make large amounts of money quickly and easily by finding, brokering, and earning commissions on seller-financed promissory notes.

The FTC’s complaint against Dalbey and others involved in marketing the program, filed jointly with Colorado Attorney General John W. Suthers, alleges that the defendants misled consumers about how much money they could make using the program and how quickly and easily they could make it.

“‘Winning in the Cash Flow Business’ was a real loser for hundreds of thousands of consumers nationwide,” said David Vladeck, Director of the FTC’s Bureau of Consumer Protection. “When someone is selling a program designed to help people make money, they have to accurately describe how much consumers can expect to make and be truthful about how quickly they will be able to do so. None of that happened in this case, and people who bought the program paid the price.”

Millions of consumers nationwide saw infomercials for the “Winning in the Cash Flow Business” program, which were hosted by TV personality Gary Collins. The program supposedly teaches consumers how to find, broker, and earn commissions on seller-financed promissory notes – privately held mortgages or notes that are often secured by the home or land that is the subject of the loan.

The FTC complaint alleges that consumers spent approximately $40 to $160 on the initial program, and were later encouraged to spend hundreds or thousands of dollars more on additional products or services, such as multi-day seminars, coaching sessions, and promissory note holder lead lists. Few of these consumers made the money that Dalbey promised them. The FTC and the State of Colorado seek a court order to stop Dalbey, his wife, and the corporate entities they control from making the allegedly misleading claims, and to obtain money for consumer refunds.

According to the complaint, since at least 1996, Dalbey has used various corporate entities to market his program. Beginning as early as 2002, he has done so mainly through a 30-minute infomercial. Along with pitches on the Internet and through direct mail, the infomercial claimed that consumers could successfully earn substantial income brokering promissory notes in three easy steps – “Find ‘Em,” “List ‘Em,” and “Make Money.”

“[Y]ou’ll be amazed at just how easy it is to generate a stream of extra income every month. Build financial freedom and a better quality of life in just minutes a day. Or even retire earlier than you ever dreamed possible. Order now and you’ll be ready to profit in minutes,” an infomercial allegedly claimed.

See also  Russell Dalbey Dashed Doing Deceptive Dialing

These claims allegedly were supported by “testimonials” from consumers who claimed to have made “$1.2 million in 30 days,” “$79,000 in a few hours,” and “$262,216 part time,” for example. “In less than 30 days, I closed two transactions and I netted 1 point – a little bit over $1.2 million,” a testimonial by “Don B.” from New York stated.

Unfortunately, according to the FTC and Colorado Attorney General, this was far from the typical consumer experience. The complaint charges that Dalbey and the other defendants violated the FTC Act and Colorado law by making false and unsubstantiated claims that consumers are likely to quickly and easily find, list, and broker promissory notes and earn substantial amounts of money; and that defendants’ additional products and services, such as coaching programs, workshops, seminars, note holder leads, and other resources, will meaningfully increase the likelihood that consumers will succeed in the note business.

The complaint also alleges that while Dalbey claimed he has earned substantial money finding, listing, and brokering promissory notes himself, most of his note-related income for the past two decades has come from marketing and selling products and services supposedly to teach consumers how to find and broker such notes. In addition, the complaint alleges that consumer testimonials in the defendants’ advertising are inaccurate and do not reflect the results that customers are likely to achieve if they buy the program. For example, some testimonialists, the complaint charges, stated earnings claims that were total earnings figures accumulated over several years, rather than in one year.

The complaint also charges the defendants with violating the FTC’s Telemarketing Sales Rule by making similar misrepresentations to consumers during sales calls.

Finally, the FTC and Colorado Attorney General charged Marsha Kellogg – one of the consumers who provided a testimonial in an infomercial – with falsely claiming that she earned $79,975.01 from one promissory note transaction using Dalbey’s program, and that her total earnings were more than $134,000. The complaint alleges that Kellogg made this statement even though she earned $50,000 less than what she claimed.

Kellogg has agreed to an order settling the FTC charges against her. The order is the FTC’s first against a consumer charged with making misrepresentations in a product or service testimonial. It prohibits Kellogg from making several types of misrepresentations in the future. In addition, Kellogg has agreed to cooperate with law enforcers in their case against the remaining defendants.

Winning in the Cash Flow Business – Some Misleading Statement Examples

RUSS DALBEY: It’s so incredibly easy, you wouldn’t believe it. You simply find a cash flow note and there’s millions of them out there, and then you list what you just found on my exclusive nationwide buyers network where buyers are ready to buy what you just found.

See also  FTC Gives Companies Terse Warning About Fake Customer Reviews

GARY COLLINS: So, you just find a note, list it on your exclusive network, and when the deal is done, you make money, just like that. RUSS DALBEY: It doesn’t get any easier than my simple three steps. ON SCREEN: Find ‘Em

RUSS DALBEY: You just find cash flow notes –


RUSS DALBEY: — you list them —

ON SCREEN: Make Money!

RUSS DALBEY: — and make money.

GARY COLLINS: Russ, what makes Winning in the Cash Flow Business —


GARY COLLINS: — different from other money making opportunities that are out there? ON SCREEN: Russ Dalbey

FOUNDER Winning In the Cash Flow Business

RUSS DALBEY: Gary, it’s because it’s so easy and it’s because it really works. You don’t need a college degree. You don’t need any investment capital. You don’t need any inventory. You don’t need employees. In fact, you don’t even need to leave home unless you want to. I’ve simplified it down to three easy steps that anyone, and I mean anyone, can do to achieve financial success.

GARY COLLINS: When I first hosted this program a few years ago, I had the opportunity to speak with Russ Dalbey, a man who started poor and discovered the secret to incredible wealth and financial freedom. Since then, thousands of people have used his easy-to-learn system to make money in the real estate business without ever buying it. Folks, this is way beyond the no money down real estate programs you’ve heard about.

In the next few minutes you’ll get your chance to . . . RETIRE this year. . . . and still make more money than most doctors! Now it’s possible — Because my team of 10 highly paid, battle-proven cash flow geniuses are going to work on YOUR financial future. You just sit back and smile as cash flow deals stream in by the DOZEN – even while you’re sleeping. – Source

I can always use your help. If you have a tip or information you want to share, you can get it to me confidentially if you click here.

Steve Rhode

9 thoughts on “Fake Testimonials Nail Company. FTC Watching.”

  1. Great article!  Thanks for pointing this out.  A couple years ago a few of my competitors were clearly using fake testimonials so we hired a company (TestimonialShield.com) to third party verify our testimonials and it helped A LOT.  I had no idea how much people didn’t believe even our real testimonials – but b/c of companies like the one highlighted in this article I can see why…  Anyways, once we were able to prove that our testimonials were real we CRUSHED our competition (the 2 companies I refer to above are no longer in business) and increased our sales. 

    Unfortunately, I’m sure false testimonials – even with the FTC beginning to crack down – will persist, but those that have real testimonials should have them third party authenticated so that their users know they’re the real deal.

  2. It’s important that the FTC crack down on these types of practices more actively since most businesses take federal regulations lightly when it comes to forging testimonials. For most websites, a customer testimonial is part of the content writing process and part of the blame lies with the FTC itself. The current laws are too lax since they allow for too much privacy when it comes to divulging testifier information. At the very least, businesses should be required to submit to annual audits of random testimonials.


Leave a Comment