The FTC vs. Online Trading Academy Core Strategy Debacle

Apparently to make a difference in the investment trading market, Online Trading Academy (OTA) started offering on-site trading and investment lessons to Baby Boomers. Last year it faced the heat by the Federal Trade Commission (FTC) for making “unsubstantiated claims” that helped it sell its training programs for as much as $50K. Over the last six years alone, the OTA collected over $370 million from nationwide consumers. This post explores the Online Trading Academy Core Strategy course and the FTC backlash on it in detail.

The Online Trading Academy Core Strategy Course

Core Strategy is a two-part course offered by Online Trading Academy. The first is a foundational course on trading that has pre-essentials and on-demand trading education lessons taught over a period of 42 hours. You need to pay $7,700 to join it. The second part of that course is the XLT (eXtended Learning Track) which costs $13,750, rounding up the Online Trading Academy Core Strategy price to $21,450.
Charging each client $45K or even higher, Online Trading Academy offers a few free products as well such as half-day classes, the Forex Course, the Professional Futures Course, the XLT Core Strategy, and the Core Strategy Course.

The FTC Investigation

Earlier in 2020, around the same time the Covid-19 pandemic started becoming a global crisis, the FTC sued California-based investment trading firm Online Trading Academy. The CEO of the company was Eyal Shachar back then. The FTC claimed that false earnings claims are used by the OTA as the basis for selling training programs as expensive as $50K. This helped the OTA collect over $370 million from clients worldwide through the 2014-2019 period alone.
The FTC asserts the OTA has been misrepresenting that it has a “patented” strategy that helps anybody earn massive income by trading in the financial market. The Agency claims that this strategy works for all markets, “whether it’s going up, down, or sideways.” It usually targets Baby Boomers, who are currently in their 50s, looking forward to retirement. Moreover, each program attendee gets allotted an Education Counselor (who are basically salespeople working on commission) to follow up on them via email or phone. These Education Counselors portray themselves as successful traders who have built up considerable wealth by applying the so-called OTA strategy.
The reality, however, is that most Online Trading Academy Core Strategy attendees are not making the kind of money that has been advertised. Data from a platform the OTA customers used for trading showed that most OTA attendees aren’t making any money at all, and many are losing a lot to the program. The claims made by the instructors are also unfounded as indicated by evidence the FTC gathered.
According to FTC Bureau of Consumer Protection Director Andrew Smith, making claims of such high earnings via training programs in the market is illegal if they are not backed by reason. It declared the earnings claims by the OTA as “unfounded.”
OTA customers who demand a refund have also been required to sign contracts that refrain them from speaking negatively about OTA or its staff, on social media, or even to law enforcement. This includes all the wrongdoing the OTA has been doing.
In September 2020, the FTC had reached a settlement with the OTA that required it to pay up to $8.3 million to benefit injured consumers.

Our Take

Our take on the Online Trading Academy Core Strategy program is that on the upside, it has on-site classes, which is rather professional. However, it is increasingly being scrutinized by the FTC, and has a cost that is a tad bit pricier than what people are happy to pay. Attendees of the program have also reported unethical enrolment practices done by the OTA staff.
Over time, the OTA prices have increased. The payment frequency is unclear for now. It apparently seems to be a one-time payment.
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