FTC sues Digital Altitude & Michael Force for over $14 million in fraud
If you’ve searched for an MLM company as part of your due-diligence, chances are you’ve come across a Digital Altitude spam blog.
The owners of these blogs shamelessly plagiarise MLM content from around the internet and present it as their own – combined with bait and switch advertising for Digital Altitude and related companies.
The worst offenders I’ve personally come across are Jesse Singh, Nicholas Pratt, Aaron & Shara Andrews, Rory Singh and likely a few other hacks I’m forgetting.
Plagiarizing content and bait and switch are scummy marketing practices that only a scummy MLM company would tolerate.
And Digital Altitude certainly fits the definition of a scummy company. BehindMLM reviewed Digital Altitude in 2016 and concluded it was nothing more than a chain-recruitment driven pyramid scheme.
Turns out the FTC agrees, following a complaint filed against Digital Altitude and creator Michael Force last month.
The January 29th FTC complaint accuses Digital Altitude, Aspire Processing, Aspire Ventures, Disc Enterprises, Rise Systems & Enterprises, Soar International Limited, The Upside and Thermography for Life (dba Living Exceptionally) as “fraudulent scheme(s) that prey on consumers”.
- Digital Altitude LLC is a Delaware company owned and operated by CEO Michael Force
- Digital Altitude Limited is a UK company also owned and operated by Michael Force, primarily used to open merchant accounts for credit card processing
- Aspire Processing LLC is a Nevada company managed by Mary Dee and Sean Brown (as an officer), primarily used to open merchant accounts for credit card processing
- Aspire Processing Limited is a UK company owned by Mary Dee with Alan Moore as an officer, it is used to advertising Digital Altitude memberships
- Aspire Ventures that shares the same details as Aspire Processing Limited
- Disc Enterprises is a Nevada company that appears to be run by Sean Brown, it is primarily used to open merchant accounts for credit card processing
- Rise Systems & Enterprise is a Utah company managed by Sean Brown, primarily used to open merchant accounts for credit card processing
- Rise Systems & Enterprise LLC is a Nevada company managed by Mary Dee and Morgan Johnson, primarily used to open merchant accounts for credit card processing
- Soar International Limited is a Utah company managed by Michael Force
- The Upside LLC is a California company managed by Mary Dee and primarily used to open merchant accounts for credit card processing
- Thermography for Life LLC (dba Living Exceptionally Inc.) is a Texas company, primarily used to pay Digital Altitude employees and affiliates
The FTC identifies most of the companies above as “alter egos” of Digital Altitude itself.
For the sake of simplicity I’ve grouped all of the above companies as just “Digital Altitude”.
Individuals named in the complaint include:
- Michael Force (right) as an officer/manager of Digital Altitude and Soar International
- Mary Dee as an officer/manager of Digital Altitude, Aspire Processing, RISE Systems & Enterprise, The Upside and Thermography for Life
- Morgan Johnson as an officer/manager of Digital Altitude, RISE Systems & Enterprise
- Alan Moore as an officer/manager of Digital Altitude and Aspire Processing
- Sean Brown as an officer/manager of Aspire Processing, Disc Enterprises and RISE Systems & Enterprise
All defendants in the complaint are accused of violating the FTC Act.
According to the FTC, Digital Altitude and its related companies solicit “steep fees for membership” on the promise of a significant income.
Since at least 2015, Digital Altitude have marketed and sold purported money-making opportunities to consumers throughout the United States and abroad.
Digital Altitude advertise their purported money-making program extensively through online webpages and social media platforms, including Facebook and Instagram.
Once consumers join, Defendants encourage them to add to the marketing effort by placing their own advertisements online, on social media platforms, and otherwise.
Digital Altitude make their own advertising copy, branded images, and other marketing materials available to consumers for this purpose, and direct consumers to use these materials in the consumers’ marketing efforts.
A substantial number of consumers have created marketing websites of their own, posted YouTube videos, and/or placed advertisements and marketing posts of their own on social media, all touting Digital Altitude’s program.
The main focus of Defendants’ advertisements—whether placed on a website, social media platform, or elsewhere, and whether placed by Digital Altitude directly or by consumers using Digital Altitude’s marketing materials—is a representation that consumers will quickly make substantial earnings with Digital Altitude’s program.
“Start and grow a profitable online business” and “make six figures online in the next ninety days or less” are two Digital Altitude marketing examples cited.
The FTC alleges Digital Altitude’s marketing claims are misleading, because in reality
the vast majority of consumers who pay Digital Altitude never earn substantial income, much less the claimed “six figures.”
Consumer losses as a result of Digital Altitude and its related companies scamming people are pegged at over $14 million dollars.
Digital Altitude’s “system” consists of little more than high-pressure sales tactics to get consumers to pay hundreds or thousands of dollars to Digital Altitude.
Most consumers make little or nothing, and do not even recoup their investment.
The fraud within Digital Altitude is voluminous and extends beyond the majority of participants being affiliates paid to recruit affiliates.
Specific examples cited by the FTC include:
- deceptive marketing claims
- Digital Altitude’s coaches and salespeople being one and the same
- the fraudulent representation that each of Digital Altitude’s coaches are six figure earners
- a “draconian and confusing refund policy that precludes most consumers from obtaining a refund once they realize they are not going to make money with Digital Altitude’s program”
If you thought the number of shell companies connected to Digital Altitude presented at the start of this article was dodgy, it’s because merchant processing providers have been giving Digital Altitude the boot.
Payment processors and banks terminated Digital Altitude’s merchant accounts at least ten times between July 2016 and January 2017 because of Digital Altitudes’ suspect business practices, including numerous disputes of payments they had made to Digital Altitude.
Some consumers sought chargebacks after Digital Altitude refused to give them a refund.
When the high chargeback rates led payment processors and banks to terminate Digital Altitude’s merchant accounts in the name of Digital Altitude, Digital Altitude embarked on further deception to continue to process credit and debit card charges for their sales.
Digital Altitude set up new corporations with different names (such as Corporate Defendants Aspire Processing and RISE Systems and Enterprise), opened new merchant accounts with these corporations, and began using the new merchant accounts to process consumers’ payments to Digital
Digital Altitude sometimes used the names of third parties, including individual defendants’ spouses, to open such accounts.
Digital Altitude and Michael Force also weren’t above flat-out lying to merchant account providers.
Digital Altitude also misrepresented Digital Altitude’s payment processing history, stating in one merchant account application that Digital Altitude had never had a merchant account terminated, even though payment processors and banks had previously terminated Digital Altitude merchant accounts at least eight times.
Underwriters for payment processors and banks (who decide whether a processor or bank should open an account for a merchant) may look at a payment processing applicant’s websites to learn about the applicant, including whether the applicant’s business practices might expose the processor to risk.
To evade this scrutiny, Defendants created “dummy” underwriting sites to show payment processors when they sought new merchant accounts.
Digital Altitude’s dummy underwriting sites differ significantly from the websites that actually generate Digital Altitude’s sales.
For example, these dummy sites do not include the earnings claims that Digital Altitude make on their sales-generating websites.
Furthermore, in an apparent effort to evade the banks’ and credit card companies’ fraud monitoring programs, Digital Altitude also misrepresented who owned Digital Altitude in their applications for merchant accounts.
They variously stated that Mary Dee owned 51%, 60%, and 90% of the entity, even though, according to Defendant Force’s sworn testimony, Mary Dee is not an owner of Digital Altitude at all.
As a result of screwing consumers out of over $14 million dollars, the FTC accuse Digital Altitude and the named defendants of
- misrepresentation regarding earnings and
- misrepresentations regarding goods and services provided
Consumers have suffered and will continue to suffer substantial injury as a result of Digital Altitude’s violations of the FTC Act.
In addition, Defendants have been unjustly enriched as a result of their unlawful acts or practices.
Absent injunctive relief by this Court, Digital Altitude are likely to continue to injure consumers, reap unjust enrichment, and harm the public interest.
Injunctive relief is being sought by the FTC by way of a temporary, preliminary injunction against Digital Altitude, an order freezing the company’s assets and the appointment of a Receiver.
A permanent injunction to stop Digital Altitude and Michael Force from committing future violations of the FTC Act is also requested.
Footnote: The FTC’s action against Digital Altitude was filed on January 29th under seal.
The court directed the case unsealed on February 7th, hence the delay in reporting.
Update February 9th, 2017 – On February 2nd the FTC was granted a TRO against Digital Altitude.
Among other things, the TRO order froze Digital Altitude assets (including those of all named defendants) and appointed a Receiver.