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Wednesday, October 08, 2003 ( 6:47 PM ) axmc From Crains Business in Chicago : Warning to jobseekers: scams abound Madigan sues local career consultants for fraud By Kelly Quigley Attorney General Lisa Madigan is accusing three Chicago-area career consulting offices of consumer fraud, alleging they tricked clients into paying hefty job placement fees and didn't deliver on promised employment. The suit comes at a time when some 438,000 people in Illinois are out of work, pushing the state's unemployment rate to 6.8%—its highest level since October 2002. The job deficit is spurring a rise in scams aimed at taking advantage of the desperate. “In a slow economy like ours, people out of work are highly hopeful, and highly susceptible, to claims that a high-paying job is available,” Ms. Madigan said in a statement. The attorney general filed a lawsuit Tuesday in Cook County Circuit Court, naming New Jersey-based Career Management Inc. and California-based DRB Ltd., two companies that do business as Bernard Haldane Associates in Illinois. Ms. Madigan’s action comes after her office received 30 complaints from former clients who say they were scammed. Under an arrangement similar to a franchise agreement, Career Management owns Bernard Haldane offices in Chicago, Oakbrook Terrace and Rolling Meadows. DRB develops career-placement programs for Bernard Haldane offices in the U.S. Broken promises Ms. Madigan alleges the Bernard Haldane offices promised to put clients in touch with a “secret job market” and built up their hopes for employment—then asked for money before producing results. The career consulting companies allegedly created a financial profile of each applicant and charged fees ranging from $3,500 to $12,500 depending on the client's liquid assets. Bernard Haldane advised clients not to conduct their own job search, further diminishing their chances of finding employment, according to Ms. Madigan. And Bernard Haldane employees performed psychological exams—again for a fee—even though there was no one qualified to analyze the results. The companies “inexcusably and illegally took advantage of its hard-working clients,” the attorney general said. Calls to Bernard Haldane’s local offices were referred to a corporate spokeswoman, who declined to comment on the lawsuit. Reading from a prepared statement, she said: “Bernard Haldane has successfully helped thousands of clients during its more than 20 years in Chicago. We remain committed to assisting every client in achieving their career goals.” Career Consulting and DRB face consumer fraud charges, penalties of $50,000 for each violation and unspecified restitution to the victims. Senior Assistant Attorney General Harvey Levin in the Chicago Consumer Fraud Bureau is handling the case. A status hearing is set for Oct. 17. Increase in scams A spokeswoman for Ms. Madigan said the state has seen an increase of job-opportunity scams during the weak economy. In July the attorney general filed suits in Cook County against two companies that allegedly lured customers into investing thousands of dollars or selling products by promising large financial returns or managerial jobs that didn’t exist. Once case involved sales of gourmet coffee and the other perfume. “These suits highlight how people who very much want to work can be taken advantage of by con artists during tough economic times,” Ms. Madigan said. # |
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