Rutledge Announces Lawsuits Involving Illegal Pyramid Schemes
November 3, 2020
Says, ‘Don’t be fooled by testimonials that these schemes work’
LITTLE ROCK – Arkansas Attorney General Leslie Rutledge today announced the first step in a law enforcement sweep against illegal pyramid schemes organized and operated in Arkansas. The State has filed lawsuits in Faulkner and Saline Counties alleging Defendants represented to consumers that they could earn a 700% return on investment and “bless” their communities by joining a “Blessing Loom” board and recruiting others to do the same. No products or services were offered in exchange for the payment, only the opportunity to earn money. But, when new participants stopped joining and the pyramids’ organizers started using consumers’ money as their own, consumers lost every dollar contributed and unwittingly participated in illegal pyramid schemes.
“These lawsuits demonstrated that we will not stand by while con artists use deceptive tactics to dupe consumers into get-rich-quick schemes,” said Attorney General Rutledge. “As scam artists find new ways to exploit consumers’ economic fears during the coronavirus pandemic, my office will tirelessly work to hold these bad actors accountable for swindling Arkansans out of their money with promises of large payouts and community goodwill. Remember, when people pay a fee for the opportunity to earn money simply by recruiting others into a program, those people are likely involved in an illegal pyramid scheme. Don’t be fooled by testimonials that these schemes work.”
Rutledge’s suit filed in Faulkner County alleges the Lackland family violated the Arkansas Deceptive Trade Practices Act (ADTPA) by organizing and operating a pyramid scheme they called “Passionate Minds Circle of Wealth.” Within eight months, more than $320,000 was deposited into separate bank accounts held by Scottie Lackland and his wife Valentina from Marion, their adult daughter Sydney Lackland from Marion, and their son Scottie D. Lackland II from Conway, who is also employed as a Little Rock Police Officer. Consumers were encouraged to join with a $500 “gift” that would grow into a $4,000 “blessing” in just 28 days, but, instead, the Lacklands converted consumers’ money and used it to pay off their debt, bolster their savings accounts, and purchase luxury goods and services, including plastic surgery.
Rutledge’s suit filed in Saline County alleges similar ADTPA violations were made by Alexander-resident Ramona McGee, who is employed by the Little Rock School District as a coach at Pulaski Heights Middle School. McGee held weekly meetings to recruit participants to join the pyramid scheme she organized, called the “Family Blessing Circle.” In exchange for a $1,400 “donation,” McGee represented participants would receive $11,200 in four to six weeks. Over just a few months, she deposited tens of thousands of dollars into her checking account and used that money to pay for vacations, shopping sprees and jewelry. Consumers were left with nothing to show for their spent money.
Each Defendant faces a $10,000 fine for each violation of the ADTPA.
Attorney General Rutledge has identified several tips for Arkansans to use in protecting themselves against pyramid schemes:
- If something sounds too good to be true, then it probably is. Know that large sums of money generally do not result from small investments.
- Be wary of “opportunities” to invest your money in programs that require you to bring in subsequent investors to increase your profit or recoup your initial investment.
- Just because something appears to be fun and was shared by a friend or family member, doesn’t mean there isn’t an inherent risk.
- Independently verify the legitimacy of any investment before you invest.
For more tips to help avoid falling victim to schemes similar to this, or to file a consumer-related claim with the Arkansas Attorney General’s Office, call (800) 482-8982, email firstname.lastname@example.org or visit ArkansasAG.gov.