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UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF NEW YORK 

WILLARD K. TOM 

General Counsel 

LEONARD L. GORDON 

Regional Director 

Northeast Region 

KAREN DAHLBERG (kdahlberg@ftc.gov) 

KELVIN D. CHEN (kchen@ftc.gov) 

Federal Trade Commission 

Northeast Region 

One Bowling Green, Suite 318 

New York, NY 10004 

tel: 212-607-2829/ fax: 212-607-2822 

FEDERAL TRADE COMMISSION, 

Plaintiff, 

v. 

CONSUMER HEALTH BENEFITS 

ASSOCIATION, organized as a Missouri not-forprofit, also doing business as CHBA, 

NATIONAL ASSOCIATION FOR AMERICANS, 

organized as a Missouri not-for-profit, also doing 

business as NAFA, 

NATIONAL BENEFITS CONSULTANTS, LLC, a 

Florida limited liability company, also doing business 

as NBC, 

NATIONAL BENEFITS SOLUTIONS, LLC, a 

Florida limited liability company, also doing business 

as NBS, 

LOUIS LEO, individually, as a Managing Member of 

NATIONAL BENEFITS SOLUTIONS, LLC, and as 

the Vice President and Treasurer of CONSUMER 

HEALTH BENEFITS ASSOCIATION, 

Case No. CV-10-3551 

(ILG)(RLM) 

FIRST AMENDED 

COMPLAINT FOR 

PERMANENT INJUNCTION 

AND OTHER EQUITABLE 

RELIEF 
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RON WERNER, individually, as a Managing 

Member of NATIONAL BENEFITS 

CONSULTANTS, LLC, as a Managing Member of 

NATIONAL BENEFITS SOLUTIONS, LLC, and as 

President and Managing Partner of CONSUMER 

HEALTH BENEFITS ASSOCIATION, 

RITA WERNER, individually, and as Senior Vice 

President and Director of Operations of CONSUMER 

HEALTH BENEFITS ASSOCIATION, 

WENDI TOW, individually, as a Managing Member 

of NATIONAL BENEFITS CONSULTANTS, LLC, 

and as a Managing Member of NATIONAL 

BENEFITS SOLUTIONS, LLC, 

JOHN SCHWARTZ, individually, as a Managing 

Member of NATIONAL BENEFITS 

CONSULTANTS, LLC, and as a Managing Member 

of NATIONAL BENEFITS SOLUTIONS, LLC, 

GUARANTEE TRUST LIFE INSURANCE 

COMPANY, an Illinois corporation, 

VANTAGE AMERICA SOLUTIONS, INC., an 

Illinois corporation, 

CENTURY SENIOR SERVICES, a Florida 

corporation, 

JEFFREY BURMAN, individually, as President of 

VANTAGE AMERICA SOLUTIONS, INC., and as 

Vice President of GUARANTEE TRUST LIFE 

INSURANCE COMPANY, and 

BARBARA TAUBE, individually, and as Vice 

President of GUARANTEE TRUST LIFE 

INSURANCE COMPANY, and 

RICHARD HOLSON, III, individually, and as 

President of GUARANTEE TRUST LIFE 

INSURANCE COMPANY, 

Defendants. 
 

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Plaintiff, the Federal Trade Commission (“FTC”), for its First Amended Complaint 

alleges: 

1. The FTC brings this action under Sections 13(b) and 19 of the Federal Trade 

Commission Act (“FTC Act”), 15 U.S.C. §§ 53(b) and 57b, and the Telemarketing and 

Consumer Fraud and Abuse Prevention Act (“Telemarketing Act”), 15 U.S.C. §§ 6101-6108, to 

obtain temporary, preliminary, and permanent injunctive relief, rescission or reformation of 

contracts, restitution, the refund of monies paid, disgorgement of ill-gotten monies, and other 

equitable relief for Defendants’ acts or practices in violation of Section 5(a) of the FTC Act, 15 

U.S.C. § 45(a), and the FTC’s Telemarketing Sales Rule (“TSR”), 16 C.F.R. Part 310. 

JURISDICTION AND VENUE 

2. This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337(a), 

and 1345 and 15 U.S.C. §§ 45(a), 53(b), 6102(c), and 6105(b). 

3. Venue is proper in this District under 28 U.S.C. § 1391(b) and 28 U.S.C. 

§ 1391(c), and 15 U.S.C. § 53(b). 

PLAINTIFF 

4. Plaintiff FTC is an independent agency of the United States Government created 

by statute. 15 U.S.C. §§ 41-58. The FTC is charged, among other things, with enforcement of 

Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), which prohibits unfair and deceptive acts or 

practices in or affecting commerce. The FTC is also charged with enforcement of the 

Telemarketing Act. Pursuant to the Telemarketing Act, the FTC promulgated and enforces the 

TSR, which prohibits deceptive and abusive telemarketing acts or practices. The FTC is 

authorized to initiate federal district court proceedings, by its own attorneys, to enjoin violations 

of the FTC Act and the TSR, and to secure such equitable relief as may be appropriate in each 

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case, including rescission or reformation of contracts, restitution, the refund of monies paid, and 

the disgorgement of ill-gotten monies. 15 U.S.C. §§ 53(b), 56(a)(2)(A), 56(a)(2)(B), 57b, 

6102(c), and 6105(b). 

DEFENDANTS 

5. Defendant Consumer Health Benefits Association (“CHBA”) is a purported 

Missouri not-for-profit with its principal place of business at 4875 Coconut Creek Parkway, 

Coconut Creek, Florida 33063-3944. Defendant CHBA previously used the website address 

www.ourchba.com, which is no longer operational. At times material to this First Amended 

Complaint, acting alone or in concert with others, Defendant CHBA has marketed, distributed, 

or sold Defendants’ medical discount plan to consumers in this district and throughout the 

United States. 

6. Defendant National Association For Americans (“NAFA”) is a purported 

Missouri not-for-profit with its principal place of business at 4875 Coconut Creek Parkway, 

Coconut Creek, Florida 33063-3944. Defendant NAFA mailed materials using the return 

address of 1111 SW 21st Avenue, Suite 24, Fort Lauderdale, Florida 33312. At times material to 

this First Amended Complaint, acting alone or in concert with others, Defendant NAFA has 

marketed, distributed, or sold Defendants’ medical discount plan to consumers in this district and 

throughout the United States. 

7. Defendant National Benefits Consultants, LLC (“NBC”) is a Florida limited 

liability company with its principal place of business at 4875 Coconut Creek Parkway, Coconut 

Creek, Florida 33063-3944. At times material to this First Amended Complaint, acting alone or 

in concert with others, Defendant NBC has marketed, distributed, or sold Defendants’ medical 

discount plan to consumers in this district and throughout the United States. 

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8. Defendant National Benefits Solutions, LLC (“NBS”) is a Florida limited liability 

company with its principal place of business at 4875 Coconut Creek Parkway, Coconut Creek, 

Florida 33063-3944. Defendant NBS used the website address www.getnbs.com, which is no 

longer operational. At times material to this First Amended Complaint, acting alone or in 

concert with others, Defendant NBS has marketed, distributed, or sold Defendants’ medical 

discount plan to consumers in this district and throughout the United States. 

9. Defendant Guarantee Trust Life Insurance Company (“GTLI”) is an Illinois 

corporation with its principal place of business at 1275 Milwaukee Avenue, Glenview, Illinois 

60025. Defendant GTLI is the parent company of Defendant Vantage America Solutions, Inc. 

and Defendant Century Senior Services. Defendant GTLI assisted in creating CHBA and NBC 

and helped fund their expenses. At times material to this First Amended Complaint, acting alone 

or in concert with others, Defendant GTLI has marketed, distributed, or sold Defendants’ 

medical discount plan to consumers in this district and throughout the United States. 

10. Defendant Vantage America Solutions, Inc. (“Vantage”) is an Illinois corporation 

with its principal place of business at 1275 Milwaukee Avenue, Glenview, Illinois 60025. 

Defendant Vantage is a medical discount plan organization that contracted with various vendors 

and suppliers of medical services, which were then bundled together as the medical discount 

plan sold by Defendants. At times material to this First Amended Complaint, acting alone or in 

concert with others, Defendant Vantage has marketed, distributed, or sold Defendants’ medical 

discount plan to consumers in this district and throughout the United States. 

11. Defendant Century Senior Services (“Century”) is a Florida corporation with its 

principal place of business at 4875 Coconut Creek Parkway, Coconut Creek, Florida 33063-

3944. Defendant Century contracted with CHBA and NBC to administer Defendants’ medical 

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discount plan, and provided space at 4875 Coconut Creek Parkway, Coconut Creek, Florida 

33063-3944 where Defendants’ medical discount plan was telemarketed. At times material to 

this First Amended Complaint, acting alone or in concert with others, Defendant Century has 

marketed, distributed, or sold Defendants’ medical discount plan to consumers in this district and 

throughout the United States. 

12. Defendant Louis Leo is a Managing Member of Defendant NBS, as well as Vice 

President and Treasurer of Defendant CHBA. His principal place of business is 4875 Coconut 

Creek Parkway, Coconut Creek, Florida 33063-3944. At times material to this First Amended 

Complaint, acting alone or in concert with others, he has formulated, directed, controlled, had 

the authority to control, or participated in the acts and practices set forth in this First Amended 

Complaint. Defendant Louis Leo, in connection with the matters alleged herein, transacts or has 

transacted business in this district and throughout the United States. 

13. Defendant Ron Werner is a Managing Member of Defendants NBC and NBS, as 

well as President and Managing Partner of Defendant CHBA. His principal place of business 

was formerly 4875 Coconut Creek Parkway, Coconut Creek, Florida 33063-3944. At times 

material to this First Amended Complaint, acting alone or in concert with others, he has 

formulated, directed, controlled, had the authority to control, or participated in the acts and 

practices set forth in this First Amended Complaint. Defendant Ron Werner, in connection with 

the matters alleged herein, transacts or has transacted business in this district and throughout the 

United States. 

14. Defendant Rita Werner is Senior Vice President and Director of Operations of 

Defendant CHBA. Her principal place of business was formerly 4875 Coconut Creek Parkway, 

Coconut Creek, Florida 33063-3944. At times material to this First Amended Complaint, acting 

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alone or in concert with others, she has formulated, directed, controlled, had the authority to 

control, or participated in the acts and practices set forth in this First Amended Complaint. 

Defendant Rita Werner, in connection with the matters alleged herein, transacts or has transacted 

business in this district and throughout the United States. 

15. Defendant Wendi Tow is a Managing Member of Defendant NBC, as well as 

Senior Vice President of Member Services of Defendant CHBA. Her principal place of business 

was formerly 4875 Coconut Creek Parkway, Coconut Creek, Florida 33063-3944. At times 

material to this First Amended Complaint, acting alone or in concert with others, she has 

formulated, directed, controlled, had the authority to control, or participated in the acts and 

practices set forth in this First Amended Complaint. Defendant Wendi Tow, in connection with 

the matters alleged herein, transacts or has transacted business in this district and throughout the 

United States. 

16. Defendant John Schwartz is a Managing Member of Defendant NBC. His 

principal place of business was formerly 4875 Coconut Creek Parkway, Coconut Creek, Florida 

33063-3944. At times material to this First Amended Complaint, acting alone or in concert with 

others, he has formulated, directed, controlled, had the authority to control, or participated in the 

acts and practices set forth in this First Amended Complaint. Defendant John Schwartz, in 

connection with the matters alleged herein, transacts or has transacted business in this district 

and throughout the United States. 

17. Defendant Jeffrey Burman is President of Vantage and a Vice President of GTLI. 

His principal place of business is 1275 Milwaukee Avenue, Glenview, Illinois 60025. At times 

material to this First Amended Complaint, acting alone or in concert with others, he has 

formulated, directed, controlled, had the authority to control, or participated in the acts and 

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practices set forth in this First Amended Complaint. Defendant Jeffrey Burman, in connection 

with the matters alleged herein, transacts or has transacted business in this district and 

throughout the United States. 

18. Defendant Barbara Taube is a Vice President of Defendant GTLI. Her principal 

place of business is 1275 Milwaukee Avenue, Glenview, Illinois 60025. At times material to 

this First Amended Complaint, acting alone or in concert with others, she has formulated, 

directed, controlled, had the authority to control, or participated in the acts and practices set forth 

in this First Amended Complaint. Defendant Barbara Taube, in connection with the matters 

alleged herein, transacts or has transacted business in this district and throughout the United 

States. 

19. Defendant Richard Holson, III, is President of Defendant GTLI. His principal 

place of business is 1275 Milwaukee Avenue, Glenview, Illinois 60025. At times material to 

this First Amended Complaint, acting alone or in concert with others, he has formulated, 

directed, controlled, had the authority to control, or participated in the acts and practices set forth 

in this First Amended Complaint. Defendant Richard Holson, III, in connection with the matters 

alleged herein, transacts or has transacted business in this district and throughout the United 

States. 

COMMERCE 

20. At all times material to this First Amended Complaint, Defendants have 

maintained a substantial course of trade or business in or affecting commerce, as “commerce” is 

defined in Section 4 of the FTC Act, 15 U.S.C. § 44. 

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COMMON ENTERPRISE 

21. Defendants CHBA, NAFA, NBC, NBS, GTLI, Vantage, and Century 

(collectively, “Corporate Defendants”) have operated as a common enterprise while engaging in 

the deceptive acts and practices and other violations of law alleged below. Defendants have 

conducted the business practices described below through an interrelated network of companies 

that have common ownership, officers, managers, business functions, employees, office 

locations, and commingled funds. Because Corporate Defendants have operated as a common 

enterprise, each of them is jointly and severally liable for the acts and practices alleged below. 

Individual Defendants Louis Leo, Ron Werner, Rita Werner, Wendi Tow, John Schwartz, 

Jeffrey Burman, Barbara Taube, and Richard Holson, III, have formulated, directed, controlled, 

had the authority to control, or participated in the acts and practices of Corporate Defendants that 

constitute the common enterprise. Accordingly, Individual Defendants Louis Leo, Ron Werner, 

Rita Werner, Wendi Tow, John Schwartz, Jeffrey Burman, Barbara Taube, and Richard Holson, 

III, are each jointly and severally liable for the acts and practices alleged below. 

DEFENDANTS’ BUSINESS ACTIVITIES 

Defendants Solicited Consumers by Telemarketing 

22. Defendants NBC and NBS initiated outbound telephone calls, or had third parties 

initiate outbound telephone calls, to consumers in the United States to induce the purchase of 

goods or services. NBC and NBS are “telemarketers” engaged in “telemarketing,” as defined by 

the TSR, 16 C.F.R. § 310.2. 

23. Defendants are “sellers,” as defined by the TSR, 16 C.F.R. § 310.2. 

24. Since approximately 2003, Defendant NBC engaged in telemarketing by a plan, 

program, or campaign conducted to induce the purchase of goods or services by use of one or 

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more telephones and that involves more than one interstate telephone call. Since approximately 

2009, Defendant NBS engaged in telemarketing by a plan, program, or campaign conducted to 

induce the purchase of goods or services by use of one or more telephones and which involves 

more than one interstate telephone call. 

Defendants Solicited Consumers Seeking Major Medical Health Insurance 

25. Since approximately 2003, Defendants, acting alone or in concert with others, 

marketed and sold a medical discount plan in various states throughout the country to consumers 

seeking major medical health insurance. Major medical health insurance generally involves an 

arrangement between an insurance company and a consumer in which the insurance company 

agrees to pay a substantial portion of the healthcare expenses that the consumer might incur in 

exchange for payment from the consumer. Defendants’ plan, in contrast, purported to provide 

consumers with access to various discounts on healthcare and healthcare-related services and 

products. 

26. Defendants’ representatives called consumers whose contact information 

Defendants had obtained from websites to which the consumers submitted requests for 

information on major medical health insurance plans. Consumers generally provided their 

contact information to this website with the expectation of obtaining information on major 

medical health insurance plans. 

27. Defendants’ representatives often did not identify the company they were 

representing when they contacted consumers. When consumers asked Defendants’ 

representatives for the name of the company they were calling from, Defendants’ representatives 

typically either refused to answer or provided a convoluted answer to the question. 

28. Many of the consumers were uninsured because of pre-existing medical 

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conditions that excluded them from major medical health insurance coverage. Others had lost 

their coverage as a result of becoming unemployed. Some consumers or their family members 

required surgery or suffered from chronic diseases. Many consumers were uninsured or under 

insured simply because they could not afford comprehensive major medical health insurance. 

29. At times, Defendants represented, either expressly or by implication, that their 

medical discount plan was major medical health insurance, when, in fact, it was not. Defendants 

often described the plan as “health insurance” or the equivalent of major medical health 

insurance to consumers. Defendants also used terms of art common in the major medical health 

insurance industry such as “PPO,” “deductibles,” “co-pay,” and “network.” Defendants 

typically failed to promptly disclose the nature of the goods or services they were selling. 

30. Even in instances where consumers were told that Defendants’ plan was a 

medical discount plan and not actual major medical health insurance, Defendants misrepresented 

that the medical discount plan would provide similar coverage to major medical health insurance 

and therefore was the equivalent of major medical health insurance. Defendants often claimed 

that they worked closely with Blue Cross Blue Shield, Aetna, and United Healthcare, and that 

there was virtually no difference between Defendants’ plan and major medical health insurance 

plans. 

31. Numerous consumers purchased Defendants’ plan under the impression that it 

was major medical health insurance or the equivalent of major medical health insurance based 

on the representations made by Defendants during the initial sales calls. 

32. Defendants used high pressure tactics during these calls to convince consumers to 

purchase the plan. Defendants told some consumers that the offer was limited to a certain 

number of consumers in their state and that they must purchase the plan quickly, or that the offer 

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would only be available that day and that the price would increase thereafter. Numerous 

consumers asked to see written materials regarding the plan prior to enrolling in it, but the sales 

representatives told them that they would not mail any written materials until after the 

consumers purchased the plan. 

33. During the initial sales call, after consumers agreed to enroll in the medical 

discount plan, the sales representatives told consumers that a portion of the call had to be 

recorded. Consumers were then coached on how to respond to the representatives’ questions, 

and consumers were specifically instructed not to interrupt or ask questions because the 

representatives would be forced to start the taping process over from the beginning. Consumers 

who interrupted or asked questions were admonished and told that the process would be very 

time-consuming if they continued to do so. 

34. After enrollment, when consumers received and reviewed the written medical 

discount plan information, many discovered that Defendants sold them a medical discount plan, 

not major medical health insurance. The discounts provided by the plan purportedly applied to 

doctor’s office visits, vision exams, prescription eye wear, dental cleaning and exams, and 

prescription drugs, through a network of providers with whom Defendants had supposedly 

contracted. The written information consumers received contained multiple disclaimers stating 

that the plan was not health insurance. Consumers did not receive insurance policies or 

insurance cards indicating that they had purchased health insurance of any kind. 

35. Defendants charged consumers an enrollment fee ranging from $29 to $279.85, 

plus monthly service fees ranging from $65 to $259, to purchase the plan. Defendants charged 

consumers the enrollment fee and the fee for the first month of service at the time of enrollment, 

which generally occurred over the telephone and before consumers ever received any written 

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information regarding the plan. 

Defendants Falsely Represented Plan Discounts and Participating Providers 

36. During initial sales calls, Defendants misrepresented that consumers would 

achieve significant savings on health care costs by purchasing Defendants’ medical discount 

plan. Defendants told some consumers that the plan would enable them to save up to 85% on 

medical expenses and that the average savings was 68% on all medical costs. In fact, few, if 

any, consumers saved money through enrollment in Defendants’ plan. 

37. Defendants further misrepresented that their medical discount plan was widely 

accepted by doctors, pharmacies, and other health care facilities throughout the United States, 

including consumers’ personal physicians. During initial telephone calls with consumers, sales 

representatives represented that the plan was accepted wherever Blue Cross Blue Shield 

insurance plans were accepted, and that consumers could use their medical discount card with 

any doctor that accepts insurance. 

38. On multiple occasions, consumers were unable to use the medical discount plan 

like major medical health insurance to pay for their medical expenses or receive significant 

discounts or savings on goods or services. For example, one of Defendants’ representatives told 

a New York City consumer that there were a number of “participating providers” in her area; 

when the consumer contacted the “participating providers” listed on CHBA’s website, however, 

she was told that many of them did not accept the plan. When another consumer tried to use the 

medical discount plan to obtain discounted prescription medicine for her daughter, the consumer 

received a “discounted” price that was higher than the price she previously paid for the medicine 

without the medical discount plan. 

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Defendants Falsely Represented Their Cancellation and Refund Policy 

39. During initial sales calls, Defendants typically misrepresented to consumers that 

they would be able to cancel their participation in Defendants’ plan at any time. Many 

consumers experienced difficulty in canceling their memberships, however, because they often 

could not reach a live representative. Many consumers were forced to call multiple times until 

they reached a representative. When consumers did contact a live representative, Defendants’ 

representatives often refused to let consumers cancel, pressuring them to think about their 

decision and to call back at another time. In some instances, Defendants told consumers that 

enrollment had been cancelled, but Defendants continued charging or debiting the monthly fee 

from consumers’ credit cards and bank accounts. 

40. Moreover, during sales calls, Defendants made various omissions regarding their 

“no refund” policy. Defendants’ written policy was that all fees paid by consumers are nonrefundable. However, during the initial sales call, Defendants were silent as to the “no refund” 

policy. When consumers called to cancel and were able to speak with Defendants’ 

representatives, they were then orally informed that there was a “no refund” policy. Typically, 

consumers received refunds only after they complained or threatened to complain to the Better 

Business Bureau, State Attorney General’s office, or another consumer protection agency 

regarding Defendants’ deceptive sales practices. 

Defendant CHBA’s Role 

41. Defendant CHBA was instrumental in creating and operating Defendants’ 

medical discount plan, by providing a “not-for-profit” front through which sales of the plan were 

offered. In actuality, CHBA had no employees or funds of its own. Its directors and officers 

conducted minimal to no business on behalf of the organization. Instead, other defendants 

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created and assembled the plan and collected consumers’ enrollment fees, in CHBA’s name. 

Defendant NAFA’s Role 

42. Defendant NAFA was instrumental in operating Defendants’ medical 

discount plan. NAFA was created in 2009, as an attempt to “rebrand” Defendants’ medical

 discount plan and distance it from numerous consumer complaints available on the Internet. 

NAFA was intended to inherit CHBA’s role in Defendants’ common enterprise. Like Defendant 

CHBA, Defendant NAFA was created to provide a “not-for-profit” front through which sales of 

the plan were offered. Like CHBA, NAFA had no employees or funds of its own. Its directors 

and officers similarly conducted minimal to no business on behalf of the organization. Instead, 

other defendants created and assembled the plan and collected consumers’ enrollment fees, in 

NAFA’s name. 

Defendant NBC’s Role 

43. Defendant NBC was instrumental in creating and operating Defendants’ medical 

discount plan. NBC was advertised as the exclusive marketing company for CHBA. NBC 

worked with Vantage to select plan components and create marketing materials. In certain 

agreements with Century, NBC and CHBA are jointly referred to as one entity. Two of 

Defendant NBC’s executives sat on the de facto board of directors of CHBA, in which the board 

discussed sales strategies and membership goals, as well as litigation brought by the Illinois 

Attorney General regarding deceptive sales practices. The same two NBC executives were also 

part of what Defendants internally referred to as “Team CHBA.” 

Defendant NBS’s Role 

44. Defendant NBS was instrumental in operating Defendants’ medical 

discount plan. NBS was created in 2009, as an attempt to “rebrand” Defendants’ medical 

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 discount plan and distance it from numerous consumer complaints available on the Internet. 

Specifically, Defendants intended for NBS to inherit NBC’s role in their common enterprise. 

Like Defendant NBC, Defendant NBS was to be the exclusive marketing company for NAFA. 

NBS was to work with Vantage to select plan components and create marketing materials. Two 

of Defendant NBS’s executives sat on the de facto board of directors of CHBA, in which the 

board discussed sales strategies and membership goals, as well as litigation brought by the 

Illinois Attorney General regarding deceptive sales practices. The same two NBS executives 

were also part of what Defendants internally referred to as “Team CHBA.” 

Defendant GTLI’s Role 

45. Defendant GTLI was instrumental in creating and operating Defendants’ medical 

discount plan, and provided substantial assistance to Defendants in the initial stages of the 

scheme. Together with Vantage, GTLI prepared the founding corporate documents for CHBA 

and NBC; named the official directors; created NAFA and NBS; reviewed sales materials; and 

selected plan components. GTLI also provided the seed money for CHBA and NBC. 

46. Defendant GTLI continued its involvement and substantial assistance throughout 

the existence of Defendants’ medical discount plan by acting as administrator for Defendants’ 

medical discount plan, which included, among other duties: collecting the consumers’ 

enrollment fees and monthly fees; paying various Defendants; paying rent for office space for 

CHBA; entering into a payment processing agreement that enabled Defendants to collect credit 

card and debit card payments from consumers; maintaining several bank accounts on behalf of 

Defendants; and assisting with responding to consumer complaints regarding deceptive 

marketing of Defendants’ medical discount plan. 

47. Three of Defendant GTLI’s executives sat on the de facto board of directors of 

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CHBA, in which the board discussed sales strategies and membership goals, as well as litigation 

brought by the Illinois Attorney General regarding deceptive sales practices. The same three 

GTLI executives were also part of what Defendants internally referred to as “Team CHBA.” 

48. Defendant GTLI deposited consumers’ enrollment fees and monthly fees into an 

account maintained by Defendant GTLI, and commingled these fees with funds unrelated to 

Defendants’ medical discount plan. Payments to various Defendants were reflected as debits 

from this commingled account. 

Defendant Vantage’s Role 

49. Defendant Vantage was instrumental in creating and operating Defendants’ 

medical discount plan, and provided substantial assistance to Defendants in the initial stages of 

the scheme. Together with GTLI, Vantage prepared the founding corporate documents for 

CHBA and NBC; named the official directors; created NAFA and NBS; reviewed sales 

materials; and selected plan components. Vantage also contracted with vendors to provide 

purported plan benefits. 

50. Defendant Vantage continued its involvement and substantial assistance 

throughout the existence of Defendants’ medical discount plan by, among other duties: 

continuing to review marketing materials; assisting with responding to consumer complaints 

regarding deceptive marketing of Defendants’ medical discount plan; and acting as the Discount 

Medical Plan Organization (“DMPO”) that provided Defendants’ medical discount plan. As the 

DMPO that provided the plan, Defendant Vantage entered into a consent order with the Florida 

Office of Insurance Regulation regarding nearly a dozen violations of the Florida Insurance and 

Administrative Codes arising from Vantage’s involvement in Defendants’ scheme, including 

violations based on the failure to properly advise consumers of the no-refund policy, not 

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providing required refunds, and making it difficult for consumers to cancel. 

51. Defendant Vantage’s President sat on the de facto board of directors of CHBA, in 

which the board discussed sales strategies and membership goals, as well as litigation brought by 

the Illinois Attorney General regarding deceptive sales practices. Defendant Vantage’s President 

was also part of what Defendants internally referred to as “Team CHBA.” 

Defendant Century’s Role 

52. Defendant Century contracted with CHBA and NBC to administer Defendants’ 

medical discount plan and to otherwise provide substantial assistance to Defendants by, among 

other duties: providing office space to CHBA and NBC at 4875 Coconut Creek Parkway, 

Coconut Creek, Florida 33063-3944; paying rent and utilities for the office space; sharing 

expenses with CHBA and NBC; providing funding to hire employees and contractors for NBC; 

operating a call center to manage customer service calls; maintaining bank accounts; and 

distributing materials to new members of Defendants’ medical discount plan. 

Defendant Louis Leo’s Role 

53. Defendant Louis Leo was a Managing Member of Defendant NBS and Vice 

President and Treasurer of Defendant CHBA. Defendant Louis Leo orchestrated much of 

Corporate Defendants’ business activities, including: establishing telemarketing campaigns; 

designing the medical discount plan; and overseeing sales practices. Defendant Louis Leo is a 

signatory to at least one bank account held in the name of Defendant NBC. 

54. Defendant Louis Leo sat on the de facto board of directors of CHBA, in which the 

board discussed sales strategies and membership goals, as well as litigation brought by the 

Illinois Attorney General regarding deceptive sales practices. Defendant Louis Leo was also 

part of what Defendants internally referred to as “Team CHBA.” 

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55. Defendant Louis Leo is jointly and severally liable for the conduct of Corporate 

Defendants because he had the authority to control and direct Corporate Defendants’ activities; 

had participated in those activities; and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

Defendant Ron Werner’s Role 

56. Defendant Ron Werner was a Managing Member of Defendants NBC and NBS 

and President and Managing Partner of Defendant CHBA. Defendant Ron Werner orchestrated 

much of Corporate Defendants’ business activities, including: establishing telemarketing 

campaigns; designing the medical discount plan; and overseeing sales practices. Defendant Ron 

Werner is a signatory to at least two bank accounts held in the name of Defendant NBC. 

57. Defendant Ron Werner sat on the de facto board of directors of CHBA, in which 

the board discussed sales strategies and membership goals, as well as litigation brought by the 

Illinois Attorney General regarding deceptive sales practices. Defendant Ron Werner was also 

part of what Defendants internally referred to as “Team CHBA.” 

58. Defendant Ron Werner is jointly and severally liable for the conduct of Corporate 

Defendants because he had the authority to control and direct Corporate Defendants’ activities; 

had participated in those activities; and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

Defendant Rita Werner’s Role 

59. Defendant Rita Werner was Senior Vice President and Director of Operations of 

Defendant CHBA and an employee of NBC. Defendant Rita Werner orchestrated much of 

CHBA and NBC’s business activities, including participating in reviewing consumer complaints 

and overseeing cancellation and refund practices. Defendant Rita Werner is a signatory to at 

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least one bank account held in the name of Defendant NBC. 

60. Defendant Rita Werner is jointly and severally liable for the conduct of Corporate 

Defendants because she had the authority to control and direct the complained of activities; had 

participated in those activities; and had knowledge of Corporate Defendants’ misrepresentations 

and other misconduct. 

Defendant Wendi Tow’s Role 

61. Defendant Wendi Tow was Senior Vice President in charge of member services 

of Defendant CHBA and a Managing Member of Defendant NBC. Defendant Wendi Tow 

orchestrated much of CHBA and NBC’s business activities, including participating in reviewing 

consumer complaints and overseeing cancellation and refund practices. 

62. Defendant Wendi Tow is jointly and severally liable for the conduct of Corporate 

Defendants because she had the authority to control and direct the complained of activities, had 

participated in those activities, and had knowledge of Corporate Defendants’ misrepresentations 

and other misconduct. 

Defendant John Schwartz’s Role 

63. Defendant John Schwartz is a Managing Member of Defendant NBC. Defendant 

John Schwartz orchestrated much of NBC’s business activities, including training and managing 

NBC’s sales agents who telemarketed Corporate Defendants’ medical discount plan. 

64. Defendant John Schwartz is jointly and severally liable for the conduct of 

Corporate Defendants because he had the authority to control and direct the complained of 

activities, participated in those activities, and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

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Defendant Jeffrey Burman’s Role 

65. Defendant Jeffrey Burman is President of Vantage and a Vice President of GTLI. 

Defendant Jeffrey Burman orchestrated much of Corporate Defendants’ business activities, 

including designing the medical discount plan and reviewing the sales scripts and marketing 

materials used by Defendants NBC and NBS. 

66. Defendant Jeffrey Burman sat on the de facto board of directors of CHBA, in 

which the board discussed sales strategies and membership goals, as well as litigation brought by 

the Illinois Attorney General regarding deceptive sales practices. Defendant Jeffrey Burman was 

also part of what Defendants internally referred to as “Team CHBA.” 

67. Defendant Jeffrey Burman is jointly and severally liable for the conduct of 

Corporate Defendants because he had the authority to control and direct Corporate Defendants’ 

activities, participated in those activities, and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

Defendant Barbara Taube’s Role 

68. Defendant Barbara Taube is a Vice President and Chief Financial Officer of 

GTLI. Defendant Barbara Taube orchestrated much of Corporate Defendants’ business 

activities, including collecting consumers’ payments for the medical discount plan, determining 

how to distribute the funds among Defendants, and determining whether to refund consumers 

who requested cancellations and refunds as a result of Defendants’ misrepresentations regarding 

their medical discount plan. 

69. Defendant Barbara Taube sat on the de facto board of directors of CHBA, in 

which the board discussed sales strategies and membership goals, as well as litigation brought by 

the Illinois Attorney General regarding deceptive sales practices. Defendant Barbara Taube was 

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also part of what Defendants internally referred to as “Team CHBA.” 

70. Defendant Barbara Taube is jointly and severally liable for the conduct of 

Corporate Defendants because she had the authority to control and direct Corporate Defendants’ 

activities, participated in those activities, and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

Defendant Richard Holson, III’s, Role 

71. Defendant Richard Holson, III, is President of GTLI. Defendant Richard Holson, 

III, orchestrated much of Corporate Defendants’ business activities, including overseeing the 

sale and administration of the medical discount plan. 

72. Defendant Richard Holson, III, sat on the de facto board of directors of CHBA, in 

which the board discussed sales strategies and membership goals, as well as litigation brought by 

the Illinois Attorney General regarding deceptive sales practices. Defendant Richard Holson, III, 

was also part of what Defendants internally referred to as “Team CHBA.” 

73. Defendant Richard Holson, III, is jointly and severally liable for the conduct of 

Corporate Defendants because he had the authority to control and direct Corporate Defendants’ 

activities, participated in those activities, and had knowledge of Corporate Defendants’ 

misrepresentations and other misconduct. 

VIOLATIONS OF SECTION 5 OF THE FTC ACT 

74. Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits “unfair or deceptive acts 

or practices in or affecting commerce.” 

75. Misrepresentations or deceptive omissions of material fact likely to mislead 

consumers acting reasonably under the circumstances constitute deceptive acts or practices 

prohibited by Section 5(a) of the FTC Act. 

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COUNT I 

Making Misrepresentations of Material Fact 

76. In numerous instances, in connection with the marketing of Defendants’ medical 

discount plan, Defendants represented, directly or indirectly, expressly or by implication, that: 

a. Defendants’ plan is a major medical health insurance plan or is the 

equivalent of a major medical health insurance plan; 

b. Defendants’ plan enables consumers to achieve significant savings on 

health care costs; 

c. Defendants’ plan is widely accepted by doctors and other medical 

providers throughout the United States; and 

d. Consumers may readily cancel their participation in Defendants’ plan at 

any time. 

77. In truth and in fact: 

a. Defendants’ plan was not a major medical health insurance plan or the 

equivalent of a major medical health insurance plan; 

b. Defendants’ plan did not enable consumers to achieve significant savings 

on health care costs; 

c. Defendants’ plan was not widely accepted by doctors and other medical 

providers throughout the United States; and 

d. In numerous instances, consumers were unable to readily cancel their 

participation in Defendants’ plan. 

78. Therefore, the representations set forth in Paragraph 76 are false and misleading 

and constitute a deceptive act or practice in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 

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45(a). 

VIOLATIONS OF THE TELEMARKETING SALES RULE 

79. Congress directed the FTC to prescribe rules prohibiting abusive and deceptive 

telemarketing acts or practices pursuant to the Telemarketing Act. The FTC adopted the original 

TSR in 1995, extensively amended it in 2003, and amended certain provisions thereafter. 

16 C.F.R. Part 310. 

80. The TSR prohibits sellers and telemarketers from failing to disclose truthfully, in 

a clear and conspicuous manner before a customer pays for goods or services offered, a 

statement informing the customer of any policy of not making refunds or cancellations. 

16 C.F.R. § 310.3(a)(1)(iii). 

81. The TSR further prohibits sellers and telemarketers from misrepresenting, 

directly or by implication, in the sale of goods or services, any material restriction, limitation, or 

condition to purchase, receive, or use goods or services that are the subject of a sales offer, and 

any material aspect of the performance, efficacy, nature, or central characteristics of the goods or 

services that are the subject of a sales offer. 16 C.F.R. §§ 310.3(a)(2)(ii) and (a)(2)(iii). 

82. The TSR also prohibits sellers and telemarketers from misrepresenting, directly or 

by implication, in the sale of goods or services, any material aspect of the nature or terms of the 

seller’s refund, cancellation, exchange, or repurchase policies. 16 C.F.R. § 310.3(a)(2)(iv). 

83. The TSR also prohibits a person from providing substantial assistance or support 

to any seller or telemarketer when that person knows or consciously avoids knowing that the 

seller or telemarketer is engaged in any act or practice that violates certain provisions of the 

TSR, including 16 C.F.R. §§ 310.3(a) and (d). 16 C.F.R. § 310.3(b). 

84. Under the TSR, an “outbound telephone call” means a telephone call initiated by 

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a telemarketer to induce the purchase of goods or services or to solicit a charitable contribution. 

16 C.F.R. § 310.2(u). 

85. The TSR requires telemarketers in an outbound telephone call to disclose 

truthfully, promptly, and in a clear and conspicuous manner the following, among other things: 

a. The identity of the seller; and 

b. The nature of the goods or services. 

16 C.F.R. § 310.4(d)(1) and (3). 

86. Pursuant to Section 3(c) of the Telemarketing Act, 15 U.S.C. § 6102(c), and 

Section 18(d)(3) of the FTC Act, 15 U.S.C. § 57a(d)(3), a violation of the TSR constitutes an 

unfair or deceptive act or practice in or affecting commerce, in violation of Section 5(a) of the 

FTC Act, 15 U.S.C. § 45(a). 

COUNT II 

Misrepresenting Material Information 

87. In numerous instances, in the course of telemarketing a medical discount plan, 

Defendants misrepresented, directly or by implication, that: 

a. Defendants’ plan is a major medical health insurance plan or is the 

equivalent of a major medical health insurance plan; 

b. Defendants’ plan enables consumers to achieve significant savings on 

health care costs; and 

c. Defendants’ plan is widely accepted by doctors and other medical 

providers throughout the United States. 

88. Defendants’ acts and practices, as described in Paragraph 87 above, are deceptive 

telemarketing acts or practices that violate the TSR, 16 C.F.R. §§ 310.3(a)(2)(ii) and (a)(2)(iii). 

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COUNT III 

Misrepresenting Material Information Regarding the Cancellation Policy 

89. In numerous instances, in the course of telemarketing a medical discount plan, 

Defendants misrepresented, directly or by implication, that consumers could readily cancel their 

participation in Defendants’ plan at any time. 

90. Defendants’ acts and practices, as described in Paragraph 89 above, are deceptive 

telemarketing acts or practices that violate the TSR, 16 C.F.R. § 310.3(a)(2)(iv). 

COUNT IV 

Failing to Disclose the “No Refund” Policy 

91. In numerous instances, in the course of telemarketing a medical discount plan, 

Defendants failed to disclose truthfully, in a clear and conspicuous manner before consumers 

paid for the medical discount plan offered, a statement informing consumers of Defendants’ 

policy of not making refunds. 

92. Defendants’ acts and practices, as described in Paragraph 91 above, are deceptive 

telemarketing acts or practices that violate the TSR, 16 C.F.R. § 310.3(a)(1)(iii). 

COUNT V 

Failing to Make Required Oral Disclosures 

93. In numerous instances, in the course of telemarketing a medical discount plan, 

Defendants made, or caused a telemarketer to make, outbound telephone calls in which the 

telemarketer failed to disclose promptly and in a clear and conspicuous manner to the person 

receiving the call: 

a. The identity of the seller; or 

b. The nature of the goods or services. 

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94. Defendants’ acts and practices, as described in Paragraph 93, are abusive 

telemarketing acts or practices that violate the TSR, 16 C.F.R. § 310.4(d). 

COUNT VI 

Assisting and Facilitating Violations of the TSR 

95. In numerous instances, Defendants GTLI, Vantage, Century, Jeffrey Burman, 

Barbara Taube, and Richard Holson, III, provided substantial assistance or support, including, 

but not limited to, preparing the founding corporate documents for CHBA and NBC, naming the 

official directors, providing the seed money for CHBA and NBC, creating NAFA and NBS, 

reviewing sales materials, selecting plan components, contracting with vendors to provide 

purported plan benefits, sitting on the de facto board of directors for CHBA, and entering 

contracts and creating bank accounts on behalf of CHBA and NBC, as described in Paragraphs 

45 through 52 and 65 through 73, to sellers or telemarketers whom they knew or consciously 

avoided knowing: 

a. misrepresented, directly or by implication, that: 

i. Defendants’ plan is a major medical health insurance plan or is the 

equivalent of a major medical health insurance plan; 

ii. Defendants’ plan enables consumers to achieve significant savings 

on health care costs; and 

iii. Defendants’ plan is widely accepted by doctors and other medical 

providers throughout the United States; 

b. misrepresented, directly or by implication, that consumers could readily 

cancel their participation in Defendants’ plan at any time; 

c. failed to disclose truthfully, in a clear and conspicuous manner before 

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consumers paid for the medical discount plan offered, a statement informing consumers of 

Defendants’ policy of not making refunds; and/or 

d. failed to disclose promptly and in a clear and conspicuous manner to the 

person receiving the call: 

i. The identity of the seller; or 

ii. The nature of the goods or services. 

96. Defendants GTLI, Vantage, Century, Jeffrey Burman, Barbara Taube, and 

Richard Holson, III’s, acts and practices, as described in Paragraph 95, are abusive telemarketing 

acts or practices that violate the TSR, 16 C.F.R. § 310.3(b). 

CONSUMER INJURY 

97. Consumers have suffered substantial injury as a result of Defendants’ violations 

of the FTC Act and TSR. In addition, Defendants have been unjustly enriched as a result of their 

unlawful acts or practices. Absent injunctive relief by this Court, Defendants are likely to 

continue to injure consumers, reap unjust enrichment, and harm the public interest. 

THIS COURT’S POWER TO GRANT RELIEF 

98. Section 13(b) of the FTC Act, 15 U.S.C. § 53(b), empowers this Court to grant 

injunctive and such other relief as the Court may deem appropriate to halt and redress violations 

of any provision of law enforced by the FTC. The Court, in the exercise of its equitable 

jurisdiction, may award ancillary relief, including rescission or reformation of contracts, 

restitution, the refund of monies paid, and the disgorgement of ill-gotten monies, to prevent and 

remedy any violation of any provision of law enforced by the FTC. 

99. Section 19 of the FTC Act, 15 U.S.C. § 57b, and Section 6(b) of the 

Telemarketing Act, 15 U.S.C. § 6105(b), authorize this Court to grant such relief as the Court 

finds necessary to redress injury to consumers or other persons resulting from Defendants’ 

violations of the TSR, including the rescission and reformation of contracts, and the refund of 

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money. 

PRAYER FOR RELIEF 

Therefore, Plaintiff FTC, pursuant to Sections 13(b) and 19 of the FTC Act, 15 U.S.C. §§ 

53(b) and 57b; Section 6(b) of the Telemarketing Act, 15 U.S.C. § 6105(b); and the Court’s own 

equitable powers, requests that the Court: 

A. Enter judgment against Defendants and in favor of Plaintiff FTC for each 

violation alleged in this First Amended Complaint; 

B. Award Plaintiff FTC such preliminary injunctive and ancillary relief as may be 

necessary to avert the likelihood of consumer injury during the pendency of this action, and to 

preserve the possibility of effective final relief, including, but not limited to, a preliminary 

injunction and expedited discovery; 

C. Enter a permanent injunction to prevent future violations of the FTC Act and TSR 

by Defendants; 

D. Award such relief as the Court finds necessary to redress injury to consumers 

resulting from Defendants’ violations of the FTC Act and TSR, including, but not limited to, 

rescission or reformation of contracts, restitution, the refund of monies paid, and the 

disgorgement of ill-gotten monies; and 

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E. Award Plaintiff FTC the costs of bringing this action, as well as such other and 

additional relief as the Court may determine to be just and proper. 

Respectfully submitted, 

WILLARD K. TOM 

General Counsel 

LEONARD L. GORDON 

Regional Director 

Northeast Region 

Dated: October 13, 2011 /s/ 

Karen Dahlberg (kdahlberg@ftc.gov) 

Kelvin D. Chen (kchen@ftc.gov) 

Federal Trade Commission 

Northeast Region 

One Bowling Green, Suite 318 

New York, NY 10004 

tel: 212-607-2829/fax: 212-607-2822 

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