Sunday, January 25, 2015

A.G. Schneiderman Reaches Settlement With NYC Security Guard Training Company That Scammed Unemployed Consumers

Company Posted Phony Job Listings, Made False Promises Of Employment To Trick Consumers Into Paying For Expensive Training Courses

Schneiderman: This Settlement Permanently Prohibits Company From Advertising Employment Opportunities Or Conducting Security Guard Classes In New York

NEW YORK – Attorney General Eric T. Schneiderman today announced that his office had reached a settlement with 1st Security Prep and Placement, a large New York City security guard training school, and its owner Allen Haft, directing as much as $100,000 to unwitting victims who paid for expensive job training courses and were falsely promised jobs in return. The Office of the Attorney General sued 1st Security, located at 250 West 40th Street, and Allen Haft in New York State Supreme Court in April 2013 and obtained a temporary restraining order shutting the school down and freezing its assets. Since the temporary restraining order was issued, 1st Security has ceased to operate.

The settlement, which resolves the litigation against 1st Security and Allen Haft, permanently enjoins 1st Security and Mr. Haft from advertising or offering employment opportunities or employment placement assistance and from offering to sell, selling or conducting security guard or other safety-related training in New York. The settlement also turns over the nearly $100,000 in frozen funds to the Attorney General, which will be used to refund victims of 1st Security’s unlawful practices, and covers penalties, costs, and fees.

“Phony job listings lured thousands of vulnerable, unemployed New Yorkers into believing they would obtain work after paying for expensive training courses. In fact, this company’s whole operation was a scam,” Attorney General Schneiderman said. “This office will not tolerate individuals or companies who make false promises to deceive the public into paying for inferior products.” 

The Attorney General’s Office conducted an undercover investigation of the company revealing that it had posted hundreds of fake security guard job listings online on Craigslist and in newspapers including the New York Post, Metro, amNewYork, and the New York Daily News. The advertisements made it seem like the company was hiring employees at high hourly wages when in fact the company was selling inferior training courses. 

When consumers responded to the ads, 1st Security falsely promised them that they had been selected for a position but told applicants that before they could start working, they had to complete a series of security guard training courses, typically at a cost of $449 to $667. 

After consumers paid for and completed 1st Security’s training courses, they met with 1st Security’s placement office and were given worthless “referrals” to security guard companies -- instead of the promised jobs. When consumers followed up on the referrals, they were not hired for any positions usually because the companies were not hiring or were not interested in hiring individuals with no experience, who had not registered to work as a security guard. 

If you were a victim of 1st Security’s scheme, please call the Office of the Attorney General’s helpline at 1.800.771.7755 or file a complaint form, available here. The amount of restitution received by individual consumers will depend on how much money victims paid to the company, as well as the number of claims submitted. 

This settlement is the latest in a series of Attorney General enforcement actions against phony security guard schools and employment agencies. In September 2011, the Office of the Attorney General was awarded a nearly $4 million judgment in a court action against C.P. International Security and its owner, based on a similar scheme. In July 2013, the Office of the Attorney General indicted two owners of phony employment agency United Care Services for advertising nonexistent jobs to the public, promising that clients who paid for their services would be placed in the nonexistent jobs and stealing money from hundreds of New Yorkers.

The case was handled by Assistant Attorney General Benjamin J. Lee and Supervisory Investigator Andres Rodriguez, under the supervision of Bureau of Consumer Frauds and Protection’s Deputy Bureau Chief Laura J. Levine, Bureau Chief Jane M. Azia and Executive Deputy Attorney General for Economic Justice Karla G. Sanchez.