WASHINGTON -- The Federal Trade Commission is mailing 426 refund checks totaling more than $950,000 to consumers who were victimized by a scam that promoted video rental machines as a business opportunity.
Combined with checks previously mailed by the FTC, the total funds returned to consumers swindled by the scheme is nearly $4 million. | SEE STORY
The additional funds are a result of the FTC's court victory in a collection action against the estate of the 10th and final defendant, Anthony Andreoni. The FTC is continuing to liquidate assets awarded in this case so that additional funds may be returned to injured consumers in the future.
The FTC alleged in its case against American Entertainment Distributors Inc., that the defendants -- five companies and five individuals -- deceived consumers into paying $28,000 to $37,500 apiece for video rental vending machines by telling them they could expect to earn between $60,000 and $80,000 a year, or recoup their initial investment in six to 14 months. In fact, according to the FTC, the defendants had no reasonable basis for their claims and all investors lost money.
The refund amounts will vary depending on the amount lost by each consumer; over 400 refund checks will be for more than $1,000.