Malta-Based Local Billing Solutions Accused in Online Pharmacy Scam

Online pharmacy scam uncovered
YNOT EUROPE – British authorities have accused Local Billing Solutions Ltd., a multi-currency payment services provider that works with the adult entertainment industry, of operating a ring of companies that bilked consumers out of millions of pounds by charging them for “free trial” offers of health supplements and tooth-whitening products.

In mid-September, the Company Investigations department of the national Insolvency Service received court approval to shut down 27 related companies registered in County Durham but operating primarily out of Malta and Barcelona. According to investigators, between August 2009 and March 2010, seven of the companies raked in more than £19 million via the web by requesting credit card information to pay shipping and handling fees on free offers, then charging cardholders £70-£80 per month without further authorization.

Registered directors of the companies claimed to know nothing about the scheme, telling investigators Brinken Merchant Incorporated Limited paid them about £150 annually to forward corporate mail. Investigators traced ownership of the companies to Clayton Douglass, one of the founders and current principals of Local Billing Solutions Ltd., in Malta.

Local Billing told the court it acted solely as a billing agent for Canonizado International of Panama, but investigators could find no such company. Instead, they found evidence tying control of at least 25 of the companies to Local Billing and Douglass, court records reveal.

The Insolvency Service closed the companies and their websites after determining the websites misled customers about the costs they would incur by accepting the “free” offers. The service said the terms and conditions presented on the websites were designed to confuse consumers.

“The Insolvency Service is determined to come down hard on companies who seek to rip off the public by mis-selling products,” Chief Executive Stephen Speed said. “I urge all consumers to be vigilant when it comes to ‘free trial offers,’ and remember: If it looks too good to be true, it often is.”

According to investigators, the now-closed companies appeared to be reincarnations of three entities previously closed in the public interest: Trading Planet Limited, Viv3lab Limited and Vivera Limited.

The 27 companies shuttered by the Insolvency Service were LB Belvedere Limited, LB Cygnus Media Limited, LB Deluxepass Limited, LB Eridanus Entertainment Limited, LB Evil Angel Limited, LB Friendfinder Limited, LB Global Web Solutions Limited, LB Internet Media Productions Limited, LB Ilogic Solutions Limited, LB LFP Internet Limited, LB Lyra Entertainment Limited, LB Nomad Media Limited, LB Pegasus Media Limited, LB Price Communications Limited, LB RSC Limited, LB Southint Prop Limited, LB Watt Media Limited, LB Carsed Marketing Limited, LB Nakedsword Limited, LB Cassiopeia Media Limited, LB Cybernet Entertainment Limited, LB RHS Limited, LB Pride Studios Limited, Intercontinental Consignment Logistics Limited, Gillmap Limited, Fyso-UK Limited and H5-UK Limited.

Products offered by the companies included Acai Berry Detox, Acai Power, Effective Acai, Acai Detox, Absolute Acai, Colon Cleanse Fresh, Colon Purify, Life Cleanse, Resveratrol, Resvmax, Miraculous Teeth Whitening, PureClean Teeth, Dermasensation and Dermainfuse.

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