Online Trading Academy

A strategy sold for up to fifty thousand dollars

Online Trading Academy, led by Eyal Shachar, sold investment “training programs” costing as much as $50,000. It represented that it had a patented “strategy” anyone could use to generate substantial income from trading, and that the strategy worked in any market, “whether it’s going up, down or sideways.”

The claims were often targeted at older consumers. OTA’s “instructors” were salespeople on commission who marketed the training at live events across the country, and who held themselves out as successful traders who had amassed substantial wealth using the strategy.

What the FTC found behind the claims

OTA does not track the trading results of its customers. Its own surveys indicated customers were not making the income advertised. Trading data from a platform its customers used suggested the vast majority made no money, and many lost money on top of what they paid OTA. Evidence obtained by the FTC indicated the instructors’ own wealth claims were false or unsubstantiated.

The company collected more than $370 million from consumers nationwide in the six years before the complaint.

The contract term that drew a second charge

OTA required customers who requested a refund to sign contracts barring them from posting negative comments about the company or its personnel, and specifically from reporting wrongdoing to law enforcement agencies. That drew a charge under the Consumer Review Fairness Act alongside the FTC Act.

The orders

A court entered a temporary restraining order in February 2020 and a preliminary injunction in April, freezing assets, appointing a monitor over OTA’s marketing, and barring the company from collecting on the loans it had made to finance its own customers’ purchases, from selling that debt, or from reporting non-payment to credit bureaus.

Under the settlement OTA must offer debt forgiveness to thousands of consumers, and the founder and other individuals together pay between $5 and $9.1 million and surrender assets. The company forgave over $13.3 million in customer debt. In August 2021 the FTC sent more than $5.4 million to 31,144 consumers, averaging about $175 each.

What is not established

The settlement resolves the allegations without any admission or finding of wrongdoing.