IMall, 2 Former Execs Settle FTC Suit

IMall Inc. and two former executives agreed to pay $4 million to settle charges they misled people about how much money could be earned selling advertising for the company’s Internet shopping mall. Former IMall President Mark Comer and former Chairman Craig R. Pickering will be barred for life from selling any Internet-related business opportunities as part of the agreement, the Federal Trade Commission said. The two also will be barred for 10 years from selling franchises. The men have left the Studio City-based company, which both helped found. IMall is responsible for paying $750,000 of the settlement; Comer and Pickering will pay the remaining $3.25 million, said Adam Guttmann, IMall general counsel. The FTC alleged that IMall representatives who conducted training seminars falsely told consumers they could earn up to $20,000 a month working five to 10 hours a week selling advertising for the company’s Internet Yellowpages Web site, the FTC said. Promotional material represented that people who paid $2,995 for the right to sell ads could expect to make $132,000 a year, the FTC charged. “Few if any, purchasers attain the specific level of earnings represented,” the FTC said. IMall took a charge during the third quarter of 1998 in anticipation of the share of the civil penalty it would have to cover, Guttmann said. IMall shares fell $2.13 to close at $17.13 on Nasdaq.