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  WASHINGTON (Reuter) - The Federal Trade Commission said Wednesday it
halted an illegal pyramid scheme advertised on the Internet that bilked
thousands of investors for more than $6 million. 

    The FTC said the case was its largest to date involving fraud on the
worldwide computer network. The agency obtained a federal court order
temporarily halting the scheme, carried out by a company called Fortuna
Alliance of Bellingham, Wash. 

    The temporary restraining order freezes the company's assets and appoints
a receiver to manage the company. The FTC also asked the court to issue a
permanent injunction that would provide remedies for consumers hurt by the
alleged scam. 

    ``Behind all the techno-jargon and the mathematical mumbo jumbo, this is
just an elaborate, electronic version of a chain letter,'' said Jodie
Bernstein, director of the FTC's bureau of consumer protection. 

    ``People are told that if they sign up and send money, they'll eventually
end up at the top of the pyramid, collecting from those at the bottom. But
most people never make it to the top.'' 

    She added that while early entrants to the scheme may make some money,
``eventually the pyramids collapse and most of the 'members' are left holding
the bag.'' 

    The FTC charged that Fortuna Alliance L.L.C. and five officers marketed
the pyramid scheme through a home page on the World Wide Web, the multimedia
portion of the Internet. 

    The agency said the scheme's promise of huge investment returns spurred
thousands of investors to plunk down anywhere from $250 to $1,750 to join.
The company claimed that members would receive more than $5,000 a month in
``profits'' as others were induced to ``enroll,'' the FTC said. 

    It also charged that Fortuna and its officers provided advice and
promotional materials for members to set up their own Web sites on the
Internet to recuit new members. 

    Officials at the company were not immediately available for comment. 

    In papers filed with the court, the FTC contended that Fortuna already
has taken in more than $6 million from consumers and transferred at least
$3.5 million of that money to a bank in Antigua, West Indies. 

    The FTC is seeking to have the money returned. The agency was tipped off
to the scheme by police in Bellingham, who were flooded with consumer
complaints, as well as by the Better Business Bureau serving northwest
Washington.

-- 
Mark Edward Taylor
Editor
Online Fraud Newsletter