Online Hosting Network/Tax Club Warning

**kasparov** · May 30th, 2012, 8:03 PM

Hi Guys,

I was contacted by Online Hosting Network at the end of 2009 to purchase some of their websites and start making money. They made claims that I would be making heaps of money from the start, and that their business model was a proven one. I at the time has no experience at all with website businesses, but liked the idea of making some extra money. I ended up spending $7k in total, of which I got back $40 in sales. The sales actually came from them, and not from anything actually sold on the sites. The funny thing is when I complained they sent me another $20, making me think that it was truly not legitimate.

Once of their sales consultants told me to get a credit card to pay for the advertising that they had planned, at around $5k. He said that with the money that I would be making that I would set aside some for advertising, and pay the credit card debt off with the rest that I was making. What a bunch of bullsh*it. lol. I'm not going to go into the details, but I was a little gullible at that time in my life.

About a month after the purchase with Online Hosting Network, I was contacted by The Tax Club, who told me that I could recoup all my costs associated with online hosting network via a tax return. Even though I was living in Australia and these were US companies they said this was still ok. They charged me $3995 for the initial fee, and told me how important it was that I get a proper business name otherwise face legal action from other companies or consumers. So they sent me legal paperwork that I needed to sign in order to action this business name, I never signed anything. Every call from them after that was just another sales pitch wanting another $5k for this or that, they were offering lines of credit that my business would need, they were trying to sell me their own websites which I declined.

Once I realized that it was a scam, which was about a month into it, I asked for a refund of my money. The declined a refund. So fro $3995 I got a few pieces of paper and a few phone calls.

Sorry for rambling for so long in this thread. I just wanted to warn others of what's out there, and was wondering if anyone can offer advice as to which avenue to take to get back some of if not all the money that I lost in this scam, approx $11K.

**akirk** · May 31st, 2012, 3:50 PM

Kasparov - thank you for the warning - it is difficult to give advice without knowing all the details (and a public forum is not the place to share everything!)
- if a real scam then go to your authorities (police etc.)
- if scammy (i.e. borderline legal - but nothing happening) then you probably have no comeback - so your best bet is to beat them at their own game - settle into this forum and learn how to make real money online

you obviously have an interest in working online, so you should be at home here - where scams are given the cold shoulder and real business is welcomed and discussed...
welcome though...

Alasdair

**KenW3** · May 31st, 2012, 9:44 PM

Kasparov, Welcome to Experienced-People.net!

Thank for the head-up on these companies. Usually, when buying a business, proper due diligence determines how much money the site is actually making, and the sites are sold for a multiple of revenue. If you are paying something that is more of an upfront fee for development of a site, leaving you with the responsibility of turning it into a site which makes money, that is always a caution flag.

I took a look around the net at these two companies, and it seems there are others displeased with their business purchases, and upfront fees paid. Any claim that states an amount you should expect to earn, that is not substantiated by proof of earnings from tax returns, affiliate sales records, and payments to the business, are suspect. Even with that proof, there is no guarantee you will be able to maintain the site's earnings at the same level as the previous owner.

Thank you for the information. These are not the only offers of this type on the internet. The Tax Club offer appears different from Online Hosting Network, but both appear to have large upfront fees before any services are provided. The moment any company starts to do a hard sell type of call to me, my next step is contact the Federal Trade Commission to report the activity. I don't know what resources you have in your country, but this is too much money to lose.

**Matteo** · June 1st, 2012, 5:06 AM

That is the same group of companies I referenced in this thread http://experienced-people.net/forums...te-from-Myebiz

You can get a back charge on your credit card, but it will take diligence and quite a bit of work. Follow the link to the Ebay forum in that thread. One guy outlines how he fought it through his credit card company and won.

**Clinton** · June 1st, 2012, 5:37 AM

Hi Kasparov, welcome to experienced-people.net. Sites like the ones you bought are exactly the type I talked about in this thread from a few days ago! Drop in and tell us what you think!

**kasparov** · June 2nd, 2012, 10:31 PM

Thanks for the replies guys, chargeback on credit card cant work as the trsnsaction happened 2.5 years ago. Im from australia and i contacted my bank around 6 months after it happened, they said nothing could be done as it was outside the 3 month limit. With regards to contacting attorney general i dont live in the states so not sure how i would do that.

Im surprised companies like this are permitted to exist by the government.

**KenW3** · June 3rd, 2012, 10:58 PM

This warning post is useful - Thanks. Suggestions for recovery of funds probably won't exist for a problem that happened two and a half years ago. I would still suggest you file a complaint with the US Federal Trade Commission, even after all this time. This is the Complaint Assistant link, and they take reports from people worldwide.

Companies like this exist everywhere. When one business is closed down, another springs up to take advantage of people. The best thing everyone can do is be proactive in reporting problems. Waiting six months before requesting a chargeback from your credit card company was too long, as you now know. Even three months is too long. If I was scammed out of 11K, I would have started dealing with it immediately. I would have filed reports with authorities in every country worldwide about this loss. That is a lot of money.

Where did you file your complaints? Which authorities did you report this to? Do you have attorneys for civil lawsuits? Obviously two and a half years later is much too late for much beyond a lawsuit, so this post serves as a warning for others to be careful. What steps did you take two years ago when you realized there was a problem?

**kasparov** · June 5th, 2012, 10:22 PM

Originally Posted by KenW3

This warning post is useful - Thanks. Suggestions for recovery of funds probably won't exist for a problem that happened two and a half years ago. I would still suggest you file a complaint with the US Federal Trade Commission, even after all this time. This is the Complaint Assistant link, and they take reports from people worldwide.

Companies like this exist everywhere. When one business is closed down, another springs up to take advantage of people. The best thing everyone can do is be proactive in reporting problems. Waiting six months before requesting a chargeback from your credit card company was too long, as you now know. Even three months is too long. If I was scammed out of 11K, I would have started dealing with it immediately. I would have filed reports with authorities in every country worldwide about this loss. That is a lot of money.

Where did you file your complaints? Which authorities did you report this to? Do you have attorneys for civil lawsuits? Obviously two and a half years later is much too late for much beyond a lawsuit, so this post serves as a warning for others to be careful. What steps did you take two years ago when you realized there was a problem?

To be honest I really didn't do too much when it happened. I was quite embarrassed that I got scammed that amount of money. I tried getting a refund back from the companies with no success. I approached my bank and it was too late. I approached an organization in Australia who told me that they couldn't do anything since it was in the states. And really didnt know what to do in terms of contacting someone in the states. I basically went online trying to see what others had done in the same situation. I will now file a complaint with the FTC. Thank you very much for the links, I appreciate it.

I'm pretty sure that I have filed a complaint with the FTC, this was around 1.5 years ago.