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I received a call the other day from a representative of International Profit Associates (IPA). I visited with the representative for a minute and, sure enough, they're still "doing their thing." I also occasionally hear of IPA's sister company, International Tax Associates (ITA). I have never heard anyone say anything positive about these guys. To the contrary, I've heard many horror stories.
I first alerted you to IPA in our September/October 2003 issue. At a business presentation, I had heard a businessman named Elvis Davis tell how IPA convinced him that it could improve his business' profitability and lower his tax bill. Davis hired IPA on an hourly basis but with a total cost estimate of $11,000. But the bill grew to $35,000 and the results were far worse than useless. Damage to his company's morale, productivity and bank account took years to correct. In hindsight, he thinks it was a scam.
Inc. magazine featured IPA in its January 2000 issue. The writer, Joe Rosenbloom, said he wrote the article after receiving complaints from Inc. readers about IPA and its tactics. The article reported that a disbarred lawyer named John Burgess, a former George S. May employee with a conviction for attempted grand larceny, owns IPA. His two founding partners also had criminal records.
According to the article, IPA was founded in 1991 and posted 2001 revenue of $105 million. With an average client fee of $18,000, it served approximately 6,000 small-business clients that year. Although IPA purports to be a consulting company, only 20% of its employees are consultants. The majority of its employees are telemarketers and sales people. In researching the story, Rosenbloom had no trouble finding disgruntled clients through Better Business Bureau complaint filings.
According to the article, IPA relies heavily on:
- Massive telemarketing force and very aggressive sales tactics
- Use of credibility-garnering "signals" such as paying for high-profile spokespersons and IPA's inclusion in Inc.'s list of fast-growing companies
- Avoiding the need to provide referrals by explaining that its clients want their names kept confidential
Inc. readers wrote to the magazine's website about IPA:
Having worked there (IPA) for 60 days and participating in the unethical hard core sales pitch, my only remorse is for the two clients whom I convinced to part with a lot of money for no value."
Walt Marino
Orlando, Florida
"I signed their pressured deal. At the time it all made sense. Now I realize the huge mistake I made."
Tim Shea,
Escondido, California
I recently spent one week in Chicago training to be an IPA senior advisor. After seeing firsthand their sales tactics (very heavy handed, strong arm, aggressive techniques), coupled with the old bait & switch approach, I have decided to pass on this opportunity."
Bob Thompson,
Detroit, Michigan
Once the sale was made, a very unqualified person came in to do the work. Nothing went well."
Elvis Davis,
Memphis, Tennessee
From what I've heard of International Tax Associates (ITA), its business model is basically the same as International Profit Associates (IPA). It has terrific salespeople who are highly skilled at dealing with your concerns about their credibility, including helping you get past negative postings that you may find on the Internet. They'll argue things like:
Any large company will, over time, have some bad customer experiences. Toyota at times will have unhappy customers, but you wouldn't say that they're a scam, would you?"
Granted, you would not. But that does not address whether IPA or ITA is a scam or not.
If you have any experience at all with IPA or ITA, we'd greatly appreciate it if you'd share your experience with us. Ditto if you have paid a "business brokerage" firm or "investment bank" a large, non-refundable up-front fee but received very little of what you really wanted - buyers that were willing and able to buy your business for the prices or "multiples" that the firm led you to believe were possible. Unfortunately, people who fall victim to scams, or think they may have been scammed, rarely tell anyone about it. But this only benefits the scammers. Please resist the urge to protect yourself and help us protect other business owners like you. Call me on my cell (918-760-2715) or send me an email (editor@TheBusinessOwner).
This article originally appeared in The Business Owner Journal, the periodical of choice for owners of small and midsize private businesses. All rights reserved, D.L. Perkins LLC. © 2010.
This publication is intended to provide general information on the subject matters covered. It is sold and distributed with the understanding that neither the publisher nor any distributor or advertiser is engaged in providing legal, tax, insurance, investment or other professional advice. The advice of a qualified professional should be sought before any reader applies a concept presented herein to his or her particular situation or business.
D.L. Perkins, LLC is solely responsible for this content.
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Good afternoon David,
I wanted to respond to your request regarding my experience with International Profit Associates. I was one of the fortunate ones that never allowed them to begin working for me. I received a call from Jan Ferry, the local sales representative, who was very professional and pleasant to deal with. After several weeks of meetings with Jan, I agreed to an initial appointment with a “business analyst” that was to be flown in from New York for $500.00. This business analyst was supposed to delve into the internal workings of my company and devise a detailed plan to increase my profit and decrease my expenses. The meeting was setup for the following Tuesday and it was the prior Friday when I was pulling in my driveway at about 6pm, my cell phone rang with a very persistent and obnoxious individual from IPA wanting me to meet with them on Monday at 2pm because this person was available at the last minute. I had other plans on Monday, but this person was not interested in my schedule, he basically said that I had no choice but to meet with them on Monday. Needless to say, I was furious and told this person to cancel the meeting altogether and to never call me again. His response to me was “that’s ok, you’re probably a minority owner anyway who can’t make this decision.” I had a funny feeling about the whole situation even prior to the Friday cell phone incident, but that basically sealed IPA’s fate with my company.
I have received probably 3 dozen attempts from IPA telemarketers whom have tried every trick in the book to get in front of me. I now simply ask if they are from IPA, then politely explain the situation to them and hang up. I have a good friend who is semi-retired at an early age with an MBA who told me that he was starting a new job with an exciting company and that he would be analyzing business for profit and expense issues. I told him that I hope it isn’t IPA. His jaw dropped because it was IPA. I shared your Scam Alert article with him that I have in my top desk drawer and encouraged him to call the Attorney General. His findings were staggering with the amount of complaints and pending litigation. Obviously my friend passed on working for IPA and couldn’t thank me enough, so I guess I got my pound of flesh for all of the grief that they caused me.
Thank you for exposing this nearly fraudulent company and protecting NSCA members.
Sincerely,
Patrick N - - Downers Grove, IL
Last August (2009) our company was contacted by a rep for International Profit Associates (IPA) selling a plan they said would be a “major benefit” for our struggling company. I agreed to allow him to come and present the plan to me and I signed a contract. The next day a Project Manager (PR) Tax Attorney and Senior Consultant showed up to do their good work to turn us around. The cost of this endeavor was never fully pointed out to me but I was lead to believe it would be somewhere around $54K.
I asked them how they thought we could pay as we were strapped for cash. They said we could make payments over time. Before the PR and attorney left at the end of the first day they required us to give them several checks for $5,000 or more each. The “consultant” returned the next day and “worked” by himself at a desk we made available to him. I don't know what he did all week but at the end of the week he presented a $17,000 bill for his time and demanded immediate payment. We didn’t have any money so he told us to write post-dated check. He promised not to cash or deposit any of them until we gave the okay and all our critical bills were paid as needed for the ongoing operation of the business.
The next week went the same way. At the end of the 3rd or 4th week when we were again presented with a large bill, immediate payment required, my wife noticed we’d already paid the $54K with the checks already written. We were then told that the $54K was for tax work only and the business consulting was another $350 per hour.
IPA then started trying to cash our checks without alerting us. Our checking account went into overdraft. Checks we had written bounced to key vendors that were already stretched thin terminated their service to us. My wife called the police and had the IPA rep removed from our office. We put "stop payment" instruction on the IPA checks that had not yet cleared. For months now, including the very day of this writing, IPA has been calling and writing and faxing and harassing us and threatening lawsuits to get us to pay more. To pay what they say are “remaining amounts owned” to them.
They got $50K from us, in cash, and the only thing we received from them was our 2008 tax returns filed and our checking account balanced in QuickBooks!
We have not recovered from this scam and probably will not for a long, long time -- if we can hold on that long. Oh, and one thing International Profit Associates (IPA) promised at the outset, to entice us to hire them, was they could get the IRS to remove a tax lien on our building. Instead, we now have two IRS tax lien’s on our building.
BEWARE, BEWARE, BEWARE of sheep in wolves clothing!!!! We’ve been living a nightmare for more than a year.
Singed,
Small Business Owner
Yep. they are still at it.
My business was scammed eight years ago. I was too embarrassed to seek help. They fleeced us.
Now they are back at my door,under the name of GPS. It seems the owner of GPS is Tyler Burgess, the former secretary of IPA and the son of John Burgess,owner of IPA.Many of the employees of GPS are former IPA employees according to BBB.
Fool me once, shame on you, fool me twice, shame on me.
Someone needs to stop this company.BBB rates them at F.
Please BEWARE!