Today's post documents a scam that started back in 2013; coincidentally when this blog began, but as it happened I never personally ran across this outfit and only became aware of it recently. Many other hopeful entry-level writers likely did, however, as it appears these people regularly trawled ProBlogger looking for cheap labor.
The company primarily went by two names: The Income Store, or Today's Growth Consultant. At its core it was a pretty standard SEO scam: promise clients the moon in terms of investment return by creating a SEO-optimized website for them without the ability to actually deliver. There are literally a million hustlers out there doing this, but usually they are satisfied to simply deliver a crappy product and run off with the money.
The Income Store was a lot more brazen. They (allegedly) decided to run a classic Ponzi scheme, targeting higher-end clients who could afford to invest at least five figures up front for a mostly hands-off managed service. The websites The Income Store created (allegedly) had no chance of generating enough revenue to keep up with the profits they were promising these clients, so they (allegedly) cooked books and took money from new clients to fraudulently pay the old ones with. Testimonials from the original clients, who weren't aware that their returns were coming from Ponzi shenanigans rather than legitimate traffic and conversions, helped to lure in new victims.
This managed to rattle on for about seven years, until founder and CEO Ken Courtright was arrested in March for fraud. The company was disbanded toward the very end of 2019, and its assets are currently in receivership pending the outcome of an SEC investigation and Kennyboy's trial.
So why go over a scam that seems to have already been busted up? Well, for one thing, writers for the company seem to have been stiffed on a substantial amount of 2019 income and may be wondering what happened. Also, it's a great "peek behind the curtain" for those who are new to freelancing and aren't aware how some of these low-rent companies that trawl job boards looking for naive newcomers operate.
The Income Store Scam
The scheme ended as Ponzi schemes always do; eventually they accumulated too many people to pay and too few new customers to keep up those payments, and when investors started not getting their checks they started asking hard questions and contacting government agencies.
At present, the company owes some $100 million collectively to about 500 clients. However, they appear to have only had $2 million in total assets when the feds swooped in on them. Court filings show that over all the years the company was in business, the sites they created for clients generated only about $9 million in total revenue.
Since at least 2015, The Income Store was also apparently very active in flinging DMCA takedown requests at every website under the sun that criticized them; they attempted to use it (though this is not how it works) to forcibly take down negative reviews at RipOffReport and similar consumer comment/review aggregator sites. They also appear to have engaged in waves of astroturfing fake positive reviews at sites like Glassdoor to try to bury accumulations of negative reviews from contractors and investors.
From the contractor end, The Income Store was apparently a regular at posting job ads on Problogger soliciting inexperienced writers. I spoke with an acquaintance who ended up in negotiations with them for a short time in 2018, and they indicated that they would take pretty much anyone who responded that seemed at least halfway competent. They paid at about the lowest end possible for a native English writer; 3 cents per word with a possible promotion to 4 cents after some time (typical low-end content mill rates). They asked you to do some sort of paid test review of 2000 words on some random, inane product; apparently this was because they were abusing bogus Shopify stores to generate traffic at this point.
Reports started coming in on various forums and review sites in late 2019 that The Income Store had ceased to pay their writers entirely and was also laying off their in-person employees in worrying numbers. Around this time they also apparently started seeing civil litigation from some of their clients. The news that the SEC was investigating started in early January, and by March ol' Kennyboy was in custody and the company's assets were seized.
What Writers & Contractors Can Learn From This
While the clients were hit the hardest by this scam, it also hurt employees and contractors who had to go unpaid or were depending on a regular source of income that was suddenly yanked out from under them.
The lesson here is to do your due diligence on anyone you do business with. And look, I remember the days when I first started out and how pressure to pay the bills can make you leap at any paying gig that will have you. But this case illustrates how an "I'm willing to work for low pay for awhile" situation can quickly turn into "I'm not going to get paid for my work and now I'm screwed" when you're dealing with a dishonest operator.
The Income Store was fishy right from the very beginning, and you only had to visit their public-facing website to see it. In the investment world, ANY kind of "guaranteed return" needs to be treated with extreme skepticism. But 15% minimum a year for life? Holy crap, that's another planet of BS. Even ol' Bernie Madoff capped his promises to people at around 11% or so. That and the shifty, amateurish sales copy should have told anyone that this was a substantial risk of being a scam operation.
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