Philly-based Influencer under fire for scamming Black small business owners
Shapiro’s office says Chanel violated Pennsylvania’s Consumer Protection Law on five counts.
Authorities in Pennsylvania are suing Instagram influencer Dana Chanel for allegedly using her social media platform to promote products and services that scammed customers, particularly Black small business owners.
My office has filed suit against the Philadelphia-based companies owned and operated by Instagram influencer Dana Chanel. Chanel used her platform on social media to promote many products but failed to deliver goods and services as promised.https://t.co/Uq2ZUAXgJA
— AG Josh Shapiro (@PAAttorneyGen) November 4, 2021
On her Instagram, she shares comedic reels about running businesses, posts promoting her products, and content about her personal life.
“Dana Chanel built a following online by presenting herself as a Black woman-owned small business success story,” wrote Pennsylvania Attorney General Josh Shapiro in a press release on Thursday, Nov. 4.
“She advertised the products of her companies as a way for other Black small business owners to achieve what she did. Then, she ripped off the same community she claimed to care about,” Shapiro said.
The lawsuit involves Chanel’s other companies, Earn Company, which helps consumers improve bad credit, and Alakazam, which helps small business owners create their own mobile app.
Both companies are co-owned and operated by Chanel and members of her family, including her sister, Cassandra April Olivera, and her father, Nakia Rattray. Both her sister and father are listed as defendants in the suit.
According to the lawsuit, regulators in Pennsylvania started to investigate after receiving multiple customer complaints who claimed they either never got the products or services they paid for or that the businesses misled them entirely.
For instance, multiple people reported that Earn Company advertised a $300 per month “VIP Package” service plan to help people raise their credit scores. The company allegedly promised an enticing “we do it for you” approach, but then made customers sign a form to let the company off the hook on actually providing the services promised, such as phone support or a designated personal account finance specialist.
In one case, a consumer paid a $1,807 deposit to the credit score company for help repairing her credit, as well as receiving related consulting and coaching services. But when she attempted to contact the company to set up these services, she got no response, and her request for a full refund was allegedly turned down.
Earn Company also told consumers that it had submitted disputes to credit reporting agencies, but people found out that these agencies had no such records.
The suit also alleges that Chanel’s mobile app company charged customers for a “business marketing manual” that they had no knowledge of or desire to purchase, but still never received it.
Alakazam was advertised to small business owners who wanted to create their own apps to promote their products and grow a community, and Chanel used Sprinkle of Jesus to help market it.
"Some consumers who paid monthly hosting fees to Alakazam never received a completed mobile app from the company or received a mobile app that lacked a minimum level of functionality necessary to give the product any value to the consumer," the lawsuit says.
In one case, a small business owner was under the impression that Alakazam would do the development work to make an app, except for small customizations. She paid $950 for app development, but her statement read that the money went towards a business marketing manual.
A $250 monthly hosting fee was also allegedly charged before the app was complete.
Shapiro’s office says that Chanel violated Pennsylvania’s Consumer Protection Law on five counts, including failing to deliver goods and services promised, misleading consumers, violating the state credit services law, and failing to register a fictitious company name with the state.
“I don’t care whether it’s on Instagram, over the phone, or on the streets. If you take advantage of Pennsylvanians for personal gain, you will be held accountable,” Shapiro tweeted.