Accused of Fraud, Job Agency Agrees to End Operations
An overseas employment agency accused of bilking 70,000 or more clients of at least $25 million gave up its fight Friday to resume operations, instead consenting to an indefinite shutdown in the face of government charges of fraud and misrepresentation.
The Federal Trade Commission had accused the Los Angeles-based Overseas Unlimited Agency of falsely promising to obtain jobs abroad for customers who typically paid fees of $395 to $550. Investigators say the agency landed jobs for no more than 50 clients during the four years it was owned by convicted swindler Michael B. Marks of Canyon Country.
Under an agreement between Marks and the FTC approved by U.S. District Judge William J. Rea late Friday afternoon, Marks’ corporate and personal assets will be frozen while investigators and a court-appointed receiver search for additional funds that could be used to make refunds to clients and to pay the firm’s other creditors.
But attorneys familiar with the case said it could be a long time--if ever--before any of the clients allegedly defrauded by the employment agency get their money back.
“It’s just unfortunate,” said California Deputy Atty. Gen. Sande Buhai Pond, who is prosecuting a separate case in state court seeking to revoke the firm’s employment agency license. “He (Marks) may have all his money in Switzerland.”
At the FTC’s request, Rea first issued a temporary injunction placing Overseas Unlimited in receivership three weeks ago. At the time, lawyers for Marks and the firm--the subjects of state or federal investigation since a few months after Marks bought the agency in mid-1984--acknowledged isolated acts of misrepresentation but denied the firm engaged in fraud.
They insisted that the company provided the only service it claimed to offer--matching clients with job opportunities it solicited from companies around the world. But the FTC and state authorities alleged that Overseas Unlimited promised far more--that clients would get high-paying overseas jobs--and barely ever made good on the pledge.
Can Draw Allowance
Under the agreement approved Friday, Marks made no admission of wrongdoing, but agreed not to engage in any misleading practices. Defense attorneys said Marks and the company agreed to the order in part because there was no way Overseas Unlimited could resume operations after being closed down since mid-May.
Marks and his wife, Susan Roy Marks, who also is named as a defendant in the FTC’s civil complaint, each will be allowed to draw a $1,250 weekly allowance from their otherwise frozen assets.
Michael Marks, who pleaded guilty early last year to a felony mail fraud charge in an unrelated case, did not appear in court Friday; his attorneys said he recently had been hospitalized.
Among the more glaring allegations leveled by the FTC in its first-ever action to shut down an overseas employment agency is the charge that Marks created a phony construction company and proceeded to match at least 2,300 clients with non-existent jobs at the firm.
Same Postal Meter
According to court filings, Marks told agency employees late last year that he had found more than 3,000 jobs for tradesmen with International Construction & Consulting Co., a Beverly Hills firm he said was building model cities in China, Egypt, Turkey and Brazil.
Clients were notified of job matches with ICCC--seemingly fulfilling Overseas Unlimited’s contractual obligations--and many received letters from the firm saying they would be invited for job interviews.
But court documents say the construction company’s letters were mailed using the employment agency’s postal meter. They also describe how Marks personally made the arrangements for International Construction’s mail pick-up and telephone services.
“Our evidence indicates that ICCC did not exist and that the job orders from it were not bona fide,” the FTC said in a court filing. “The ICCC scam afforded Marks another means of depriving customers of their refunds.”
Marks’ attorneys declined to comment on the allegation.
