# Federal court enters $25M judgment and permanent ban against Ascend Ecom after FTC alleges its 'AI-powered' passive-income storefronts earned clients virtually nothing > In FTC v. Ascend Capventures Inc. (No. 2:24-cv-07660-SPG-JPR, C.D. Cal.), the court granted the parties' stipulation on 11 August 2025 and entered judgment of $25,000,000 in favor of the FTC against the Ascend entities and operators William Michael Basta and Jeremy Kenneth Leung, jointly and severally, as monetary relief — partially suspended as to the individual defendants upon surrender of specified assets — alongside a permanent ban on marketing any business opportunity or business-coaching program and an express prohibition on misrepresenting that a product 'will use artificial intelligence (AI) to maximize revenues.' The FTC's complaint, one of the five inaugural Operation AI Comply actions (September 2024), alleged that since about 2023 Ascend pitched its e-commerce storefront business as 'powered by artificial intelligence' while 'virtually none of Ascend's clients earn the advertised income' and the scheme took 'at least $25 million' from consumers. The order is stipulated; the defendants neither admit nor deny the allegations. - Verification status: pending - Case type: deployment - Provider: Ascend Capventures Inc. and related entities (Ascend Ecom, ACV Partners, Accelerated eCom Ventures, Ethix Capital by Ascend, ACV Nexus), operated by William Michael Basta and Jeremy Kenneth Leung - Client: No client — honest-negative regulator/court story; the counterparties are the consumers who bought the 'AI-powered' storefront packages, E-commerce 'automation' business opportunities (Amazon/Walmart/Etsy/TikTok storefront management) (named) - Sector: e-commerce / United States / ops - Canonical URL: https://theinternetninja.com/stories/ftc-ascend-ecom-ai-business-opportunity-25m-judgment-court-ordered-ban-2025/ - Source: The Internet Ninja (theinternetninja.com), independent verified-proof platform ## Outcomes | Metric | Before | After | | --- | --- | --- | | Court-entered monetary judgment | | | | Permanent industry ban | | | | Express AI-misrepresentation prohibition | | | | Regulator-alleged harm | | | ## Verification method Court-entered stipulated order (DE 117) fetched from the RECAP archive and verified byte-identical to the Internet Archive mirror; FTC complaint and proposed order fetched live from ftc.gov with sha1 digests exactly matching day-of Wayback CDX digests; FTC releases captured at CDX-confirmed Wayback timestamps; all 22 dossier quotes verified mechanically with quotecheck against local captures; entry date triple-fixed by the PACER page stamp, the CourtListener docket, and the FTC's December-2025 semiannual litigation status report. The $25M monetary judgment and the permanent business-opportunity ban are each corroborated by TWO independent order-stage newsrooms — MyChesCo (Maryann Pugh, 2025-06-29) and the Retail & Consumer Products Law Observer (Kelley Drye, Laderach/Forster, 'FTC Updates June 23-27 2025') — both byte-tied to their Wayback captures; awaiting human client/registry confirmation before a green verified badge ## Full case file ## The pitch Ascend Ecom sold e-commerce "automation" as a business opportunity: consumers paid tens of thousands of dollars for Ascend to open and manage online storefronts on platforms like Amazon.com and Walmart.com, with the promise of thousands of dollars a month in "passive income." Per the FTC's federal-court complaint (filed 9 September 2024, C.D. Cal.): "Since about 2023, Defendants' deceptive sales pitch has said their business model is powered by artificial intelligence ('AI')." The complaint alleges Ascend advertised "'five figures' or more per month" in passive income and claimed "to use proprietary software and artificial intelligence to maximize clients' business success." ## What the regulator alleged The complaint's core allegation is the gap between the AI pitch and the outcome: "In truth, virtually none of Ascend's clients earn the advertised income. Most lose their entire investment, and some are saddled with burdensome credit card debt." The FTC alleged the scheme "has defrauded consumers of at least $25 million," and that Ascend operated under a rotating set of names — Ascend Ecom, Ascend CapVentures, ACV Partners, ACV, Accelerated eCom Ventures, Ethix Capital by Ascend, ACV Nexus — while suppressing negative reviews by invoking non-disparagement contract clauses, "claiming that negative reviews constitute violation of the contracts and threatening the loss of Ascend's 'buyback guarantee' if the contract terms are violated." These are the regulator's allegations in a signed public filing; no allegation was adjudicated at trial, and the defendants neither admit nor deny them. The case was one of the five inaugural actions of the FTC's **Operation AI Comply** sweep (announced 25 September 2024) — "five law enforcement actions against operations that use AI hype or sell AI technology that can be used in deceptive and unfair ways." The sweep release describes Ascend's pitch as "'cutting edge' AI-powered tools" — that phrasing is the FTC's release wording; the complaint's searchable text says "powered by artificial intelligence." ## What the court ordered The case moved fast: ex parte TRO entered 13 September 2024, preliminary injunction 3 December 2024, proposed stipulated order filed 23 June 2025 (Commission vote 3-0). On **11 August 2025**, Hon. Sherilyn Peace Garnett granted the stipulation and entered the order (DE 117): - **$25,000,000 judgment** — "Judgment in the amount of Twenty-five Million Dollars ($25,000,000) is entered in favor of the Commission against Defendants, jointly and severally, as monetary relief." The judgment is partially suspended as to the individual defendants: on "completion of all payments and transfers specified" (bank-account contents, proceeds of named real estate), "the remainder of the judgment is suspended," expressly premised on the truthfulness of their sworn financial statements. The FTC attributes the suspension to "the defendants' inability to pay the full amount." The $25M is a judgment as monetary relief — not a fine, and not a sum collected. - **Permanent industry ban** — defendants are "permanently restrained and enjoined from advertising, marketing, distributing, promoting, or offering for sale … any Business Opportunity or Business Coaching Program." - **An AI-specific prohibition, in the order itself** — defendants may not misrepresent that a good or service "Will use artificial intelligence (AI) to maximize revenues or otherwise enhance the profitability or effectiveness of the good or service." ## Why this matters for TIN This is the business-opportunity twin of the AI-washing actions already in the corpus (SEC Delphia/Presto, FTC DoNotPay, FTC Rite Aid): a court-entered order whose figures originate with an independent adjudicator and regulator, not with any vendor's marketing. The claim "our AI maximizes your revenue" was, on the FTC's allegations, the product itself — and it ended in a permanent ban and a $25M judgment. For buyers evaluating "AI-powered automation" offers, the verified public record — who states the number, in what signed artifact — is exactly the gap TIN exists to close. ## Path to green There is no client to confirm a number with — this is an honest-negative regulator/court story whose critical figures sit in signed public artifacts (the entered order, the filed complaint, the FTC's releases and litigation report). If published, it runs as a verified-record honest-negative, never as a green-badge client story. Watchpoints that would strengthen it: an FTC redress/refund announcement naming amounts actually returned to Ascend consumers, a future ftc.gov posting of the entered order, or an on-record statement from the defendants' side (none found this session).