The query of why Redwood Scientific Applied sciences stalled on offering the FTC with requested paperwork for over a 12 months has been answered:
Redwood knew a regulatory lawsuit would comply with.
In hindsight I can’t say I blame them actually. Seems client fraud is simply the tip of the Redwood iceberg…
Put together to be disgusted.
On October tenth the FTC filed a sealed lawsuit towards Redwood Scientific Applied sciences for client fraud.
Named defendants within the lawsuit are
- Redwood Scientific Applied sciences (mother or father firm of RengaLife)
- Jason and Eunjung Cardiff (homeowners)
- Danielle Cadiz (a Redwood government since December 2016)
- Establish LLC (a associated Wymong firm)
- Superior Males’s Institute Prolongz LLC (Redwood’s prior firm title)
- Run Away Merchandise LLC (New York firm used to promote Redwood merchandise) and
- Carols Place Restricted Partnership (a associated asset administration restricted partnership, owned by the Cardiffs)
As per their lawsuit, the FTC alleges the above defendants made
false and unsubstantiated claims for dissolvable movie strips marketed for smoking cessation, weight reduction, and male sexual efficiency; a associated autoship continuity program leading to unauthorized shipments and fees; abusive telemarketing via robocalls; and unsubstantiated earnings claims for a multi-level advertising scheme.
The MLM scheme in query is RengaLife.
Launched earlier this 12 months, RengaLife has since been closed amid the continued FTC investigation into Redwood Scientific Applied sciences.
Along with current fraud via RengaLife, the FTC allege
Jason Cardiff, Eunjung Cardiff, and Danielle Cadiz have for years operated a fraudulent multi-pronged scheme that has bilked customers out of thousands and thousands of {dollars} via baseless promoting claims for merchandise that purport to alleviate critical well being circumstances, whereas additionally enrolling customers in undesirable autoship packages which have resulted in thousands and thousands of {dollars} in unauthorized fees.
Redwood merchandise in query (all of which have been marketed via RengaLife) are TBX-Free, Eupepsia Skinny and Prolongz.
The FTC claims Redwood harmed customers by
- making “false or unsubstantiated claims” concerning the merchandise
- utilizing “abusive telemarketing practices”
- providing faux money-back ensures
- enrolling them in “autoship continuity plans” with out permission
- making it troublesome to cancel unauthorized autoship plans
The FTC’s fifty-two web page grievance particulars quite a few examples of Redwood product advertising and “misleading gross sales and billing practices”.
With respect to RengaLife, the FTC states the
defendants didn’t have precise earnings knowledge for Rengalife members on the time they made their earnings claims, nor did they’ve any foundation for earnings claims primarily based on the sale of Redwood movie strips, as a result of these merchandise have by no means been bought with out misleading and unfair practices.
The Rengalife program is structured such that, if members comply with Defendants’ directions for advancing via this system by recruiting new members, the overwhelming majority of individuals will lose cash, not earn substantial earnings.
The FTC alleges a number of violations of the FTC Act, Restore On-line Shopper’s Confidence Act, Digital Fund Switch Act, Telemarketing Gross sales Rule throughout sixteen counts.
The FTC’s sought ex-parte TRO was granted on October tenth. A preliminary injunction listening to was scheduled for October twenty third.
Regardless of receiving discover of the listening to, Redwood as an organization didn’t make an look.
On October twenty fourth the FTC’s requested preliminary injunction towards Redwood was granted. The court docket additionally ordered an asset freeze and appointed a Receiver.
Separate injunctions have been later issued towards Jason and Eunjung Cardiff earlier this month.
Belongings seized by the Receiver to date embrace luxurious watches and jewellery insured for over $1.1 million {dollars}.
One merchandise beloning to Eunjung Cardiff, described as a “women ring spherical middle stone 8.5 cts, VS2 with diamonds”, is insured for $532,500.
A November 1st filed report by the appointed Receiver reveals that upon attending Redwood’s places of work, he discovered a warehouse employee shifting Redwood stock into a set owned by Individuals United for Christians (PUFC).
The Receiver’s report describes Individuals United for Christians as a “digital ministry”, of which Jason Cardiff is the “Grasp Prophet” of.
The operations of Redwood Scientific Applied sciences, Inc. (Redwood) and the PUFC are intertwined and comingled.
Individuals United for Christians workers noticed by the Receiver have been
have been slicing small swatches of cheesecloth representing an merchandise of spiritual significance.
One full-time worker and one part-time worker additionally did pc enter reflecting the sum of money acquired for a selected marketing campaign.
Campaigns have been despatched out to a mailing checklist obtained from Cardiff’s former faither-in-law, Peter Popoff.
In line with data on the web, Mr. Popoff is a televangelist who has been accused for no less than the previous 30 years of creating misleading or fraudulent claims to heal illness and selling merchandise akin to “blessed water” and “holy sand” to potential vulnerable and weak viewers.
The data additionally studies that Mr. Popoff, referring to himself as a Prophet, promised “fabulous excessive fortune” and “miracles” in trade for donations to his group.
Examples of marketing campaign materials Cardiff despatched out revealed “mass-produced letters” that contained
fake hand written notations, verify marks, underscores, asterisks, circles and encouragement to learn on, in inexperienced ink.
There may be additionally an in depth use of daring sort. The letter is overflowing with non secular terminology, guarantees from God, divination of future occasions and assurances of cash to come back to the goal people.
Textual content contained in letters embrace the next:
The highly effective occasions I witnessed within the spirit realm (that) reveal that your upcoming future is altogether ASTOUNDING.
Understand one factor: God would by no means direct me to write down you want this if He wasn’t ALREADY TAKING MEASURES TO BLESS YOU!
I attempted to just remember to had this MIRACULOUS ANOINTED OIL in your arms…Steps one via three contain placing the miraculous anointed oil on painful
areas of the physique.Step 4 includes placing the miraculous anointed oil on a cell
telephone and mailbox to facilitate the notification and receipt of cash “a LARGE SUM OF MONEY earlier than you suppose.”Following the guarantees is a robust request, virtually a directive, to ship a donation of $40 to $250 to “see God transfer along with your prayer wants.”
One current marketing campaign is believed to have netted PUFC “a mean of $40,750 a month”.
When wanted, PUFC workers have been used to package deal Redwood merchandise.
Staff of PUFC said that after the third quarter, 2017, workers didn’t obtain checks with paystubs and that at 12 months finish they didn’t obtain 2017 W-2 studies for his or her use in finishing their taxes.
The worker said that when she pressed Mr. Cardiff, he turned very offended and referred her to a Redwood supervisor who instructed her PUFC had not reported any data to the Inside Income Service and due to this fact, the staff didn’t have to both.
Upon interviewing Jason Cardiff onsite, the Receiver concluded he’d doubtless been lied to.
The Receiver directed Mr. Cardiff to Part XVI. paragraph E. of the TRO which requires the Receiver to take custody, management, and possession of varied worthwhile articles.
Mr. Cardiff instructed the Receiver that all the objects listed within the TRO had been liquidated over the previous few years.
He first mentioned the objects had been liquidated over the past two to 3 years after which later mentioned over the past 4 to 5 years.
He additional said that all the things was bought for money at pawn outlets abroad and most objects have been bought at pawn outlets in London.
He additionally instructed the Receiver that he had no information reflecting the sale of any of the property detailed within the TRO.
Liquidate over one million in property via pawn outlets and haven’t any document of any of the gross sales? Appears legit…
The Receiver then requested Mr. Cardiff about merchandise 25, his spouse’s (defendant Eunjung Cardiff) 8.5 carat diamond ring which is insured for $532,000.
In response, Mr. Cardiff defined that the ring was bought in Abu Dhabi and proceeds of the sale have been wire transferred to a belief within the Prepare dinner Islands.
He said there are at present no funds within the belief as a result of the funds have been wire transferred again to the US to fund enterprise operations.
In response to additional questions from the Receiver, he said that neither he nor his spouse is a trustee of the Prepare dinner Islands belief and he doesn’t know the way the belief works or who gives directions to the belief to switch funds.
Allegedly promote a hoop for half one million {dollars}. Then allegedly switch the cash to an offshore belief you allegedly know nothing about…?
Yep, clearly nothing suss happening right here.
The Receiver obtained a present insurance coverage coverage for the jewellery from Roger Stone Insurance coverage company.
The coverage interval is from February 11, 2018 to February 11, 2019 and the annual premium is $16,868.77.
The protection nonetheless consists of the 8.5 carat diamond ring.
The Receiver will examine this subject additional, however has preliminarily concluded that Mr. Cardiff’s rationalization concerning the disposition of those worthwhile property that stay insured and the operation of the Prepare dinner Islands belief strains credibility and truthfulness.
Along with telling porky pies, it seems Cardiff additionally destroyed proof requested by the FTC.
As revealed by way of the Receiver’s interview with Danielle Walker;
The Receiver requested Ms. Walker if Mr. Cardiff or anybody else issued directions to destroy pc recordsdata after receiving the FTC’s Civil Investigative Demand (CID).
The CID instructed Redwood to look all pc recordsdata for these key phrases and to provide any responsive paperwork to the FTC.
Ms. Walker instructed the Receiver that Mr. Cardiff instructed Redwood’s workers to look their paperwork for these key phrases and to delete any paperwork with any of the important thing phrases.
In line with Ms. Walker, Mr. Cardiff mentioned “that if the FTC bought a maintain of something with key phrases, particularly those who mentioned 88%, we’d all be in quite a lot of hassle and we’d lose all the things.”
How very “Grasp Prophet” of him.
As to Redwood’s enterprise operations, the Receiver concluded the corporate
can’t be continued profitably.
Monetary data beneath totally describes the hopelessly bancrupt monetary situation and operation of the Receivership Entities.
Along with destructive money balances of about $114,000, there are roughly $5.0 million in present liabilities.
The audited monetary statements for 2015 and 2016 from Redwood’s unbiased auditor present gathered losses of about $9.9 million as of December 31, 2016.
Redwood’s monetary information, which seem like incomplete and never totally present, present extra internet losses from January 1, 2017 via October 12, 2018 of roughly $1.99 million, indicating gathered losses might now whole about $11.9 million.
Nonetheless sufficient for Jason Cardiff to purchase a half mill ring for wifey however.
I’ve added the FTC’s Redwood lawsuit to our checklist of tracked circumstances, so keep tuned for updates as we obtain them.
Replace thirtieth November 2023 – Jason Cardiff has been arrested on associated legal fraud fees.