Business ProfileforDevumi LLC

The following describes government actions that has been resolved by either a settlement or a decision by a court or administrative agency. If the matters are being appealed, it will be noted below.

On 10/21/2019, the Federal Trade Commission (FTC) announced that it has halted the deceptive online marketing tactics of a company and its principal, which allegedly sold fake indicators of social media influence. Posting deceptive or inaccurate information online pollutes the e-commerce marketplace and prevents consumers from making informed purchasing decisions. With these two actions, the FTC makes it clear that it will take enforcement action against this type of illegal behavior.

Devumi, LLC (Devumi) and its owner and CEO, German Calas, Jr., have agreed to settle the FTC’s first-ever complaint challenging the sale of fake indicators of social media influence, which are important metrics that businesses and individuals use in making hiring, investing, purchasing, licensing, and viewing decisions. According to the FTC’s complaint, the now-defunct Devumi, and its owner and CEO, German Calas, Jr., used their websites Devumi.com, TwitterBoost.co, Buyview.co, and Buyplans.co to sell fake indicators of social media influence, including fake followers, subscribers, views, and likes to users of social media platforms, including LinkedIn, Twitter, YouTube, Pinterest, Vine, and SoundCloud. 

The FTC alleges the defendants sold fake Twitter followers to actors, athletes, musicians, writers, and others who wanted to increase their appeal as online influencers. The FTC alleges that Devumi also sold fake Twitter followers to motivational speakers, law firm partners, investment professionals, and others who wanted to boost their credibility to potential clients. According to the FTC, Devumi filled more than 58,000 orders for fake Twitter followers, enabling the buyers to deceive potential clients about their social media influence.

Devumi also allegedly had more than 4,000 sales of fake YouTube subscribers and over 32,000 sales of fake YouTube views to its clients, including musicians who wanted to increase the apparent popularity of their songs. The FTC contends that the defendants thereby enabled their customers to deceive both potential viewers and potential music purchasers. In addition, according to the complaint, the Devumi defendants sold more than 800 fake LinkedIn followers to marketing, advertising, and public relations firms; companies offering computer software solutions; banking, investment, and other financial services firms; human resources firms; and others. These fake followers, the complaint alleges, enabled the buyers to deceive potential clients, investors, partners, and employees. By selling and distributing fake indicators of social media influence to users of various social media platforms, the FTC alleges the defendants provided their customers with the means and instrumentalities to commit deceptive acts or practices, which is itself a deceptive act or practice in violation of the FTC Act.

The proposed court order settling the FTC’s charges contains both conduct and monetary provisions. First, it bans the Devumi defendants from selling or assisting others in selling social media influence to users of third-party social media platforms. The order also prohibits the defendants from making misrepresentations, or assisting others in doing so, about the social media influence of any person or entity or in any review or endorsement of any person, entity, product, or service. Finally, the order imposes a monetary judgment against German Calas, Jr. of $2.5 million, the amount that the FTC alleges he was paid by Devumi or its parent company. The order specifies that upon payment of $250,000, the remainder of the judgment will be suspended. If Mr. Calas is later found to have misrepresented his financial condition to the FTC, the entire judgment immediately will become due.

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On 1/30/2019, New York Attorney General Letitia James announced a precedent-setting settlement over the sale of fake followers, “likes,” and views on social media platforms, including Twitter and YouTube, using fake activity from false accounts. The settlement prohibits Devumi LLC and related companies (“Devumi”) from engaging in any of the same misconduct going forward. This settlement marks the first finding by a law enforcement agency that selling fake social media engagement and using stolen identities to engage in online activity is illegal.   

The fake followers, “likes,” and other activity that Devumi sold came from computer-operated accounts (“bot accounts”) or by one person pretending to be many other people (“sock-puppet accounts”). Such accounts, found on social media platforms including Twitter, YouTube, LinkedIn, SoundCloud, and Pinterest, pretended to express genuine opinions of real people, when they actually reflected false, paid-for activity aimed at deceiving online audiences and the public. Some activity Devumi sold came from fake accounts that copied real people’s social media pictures and profiles without the knowledge or consent of the person whose identity had been copied.   

Devumi ceased operations in mid-2018, shortly after the commencement of the Attorney General’s investigation and related publicity caused a major decline in its sales. 

The Attorney General’s findings?on Devumi are as follows:  

Devumi LLC and related companies owned by German Calas, Jr. – including DisruptX Inc.; Social Bull Inc.; and Bytion Inc. (collectively, “Devumi”) – sold fake followers, “likes,” views and other forms of online endorsement and activity to users of social media platforms. Devumi supplied the fraudulent activity using bot and sock-puppet accounts. These bot and sock-puppet accounts falsely pretended to express the genuine positive opinions of real people. In some instances, Devumi supplied fake accounts that copied real people’s social media profiles without consent, including their name and picture.  

In addition, Devumi sold endorsements from social media influencers without disclosing that the influencers had been paid for their recommendations. This is especially troubling when considering that the opinions of influencers can have particularly strong influence over the reputation and sales for any product, company, service or person they endorse. 

These business practices deceived and attempted to affect the decision-making of social media audiences, including: other platform users’ decisions about what content merits their own attention; consumers’ decisions about what to buy; advertisers’ decisions about whom to sponsor; and the decisions by policymakers, voters, and journalists about which people and policies have public support.    

Devumi’s practices deceived some of the company’s own customers who mistakenly believed they were paying for authentic endorsements, while many other Devumi customers knew they were buying fake activity and endorsements. Devumi also deceived the social media platforms, which have policies prohibiting fake activity.

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On 1/31/2019, Florida Attorney General Ashley Moody announced that a company selling fake Twitter followers to celebrities, professional athletes, comedians, television actors and others is permanently banned from the practice. The lifetime ban comes after an investigation by the Florida Attorney General’s Office into the social media company Devumi. The company, formerly based in Palm Beach, sold hundreds of millions of fake followers, known as bots, to an estimated 200,000 customers nationwide. 

The Florida Attorney General’s Office recently secured an agreement with Devumi Inc, Devumi, LLC, and the owner, German Calas, Jr. to stop the company’s deceptive social media practices. The investigation uncovered allegations that Devumi advertised itself as a social media marketer, promising to generate traffic from natural persons. Instead, the company sold automated bot traffic from artificial social media accounts. 

These fake accounts enabled social media influencers to artificially increase followers and mislead consumers, by creating the perception that products or people online possessed stronger, more active social media followings or endorsements. The bots were designed to give the appearance that real people were expressing opinions, sharing information, or otherwise engaging in social media activity.

As part of the agreement, Devumi Inc, Devumi, LLC, and Calas, Jr. are prohibited from:
- Purchasing, guiding, controlling, or managing any social media accounts generated using any natural person’s personal information, regardless of whether such social media accounts originated within Devumi, from Calas, Jr., or via third-party providers;
- Utilizing any natural person’s personal information without that natural person’s express, written consent to generate products or services;
- Scraping any natural person’s personal information without express, written consent, regardless of whether that information is available to the public;
- Advertising, selling, or offering to sell products or services from natural persons when the products or services are from bots;
- Making any misrepresentation regarding or fraudulently endorsing any individual, product or service;
- Providing paid endorsements without clearly and conspicuously disclosing that the recipient compensated Devumi or Calas, Jr. for same;
- Making any representation in the course of providing paid endorsements which would lead a consumer acting reasonably to believe that the social media accounts making the endorsements are owned or operated by natural persons when in fact such accounts are bots; and
- Misrepresenting that Devumi’s or Calas, Jr.’s products or services are approved by any social media platform or are risk-free. 

In addition, Devumi and Calas, Jr. are required to pay $50,000 in investigative fees and costs to the Florida Attorney General’s Office.