The Unreal Housewife: Ep. 3, Sunk Cost Fallacy

Previously on Queen of the Con.

She was very pleasant in the beginning and I really really did love her like a sister. And as things progressed, she took my kindness as weakness and weaponized it against me. Things became very very chaotic.

Shriek hasn't been home since Saturday.

Toxic, You've decided to bring it to me.

Abusive.

That's what happened when we're in theta and.

It ended pretty abruptly.

But not before video gets leaked on the Internet showing jen Shaw being abusive to Cola Johnson and the rest of her staff. No, and while all this is going on, jen is publicly being very vague about what exactly she does for a living and where all her money comes from.

Do you know how much traffic is on the internet every second, all the people clicking. I'm making money on every click, every time you click on anything, I'm getting some money.

But the truth is actually far more sinister than anyone could have ever imagined. It was awful what she did to those people, It really was. She turned up their lives for what a fake Fendi bag. Congrats girl, I'm Jonathan Walton and this is Queen of the Con. The Unreal Housewife Episode three, sunk cost.

Fallacy scandal sells reality TV like literally nothing else.

That's the internet's go to legal list and former prosecutor Emily D. Baker she's been following the Genshaw case closer than most on the Emily Show podcast.

And so when this all broke, it was like, Oh my god, how how is this happening? Well, cameras are rolling. It made very compelling television, and now everyone was kind of gripped, and people went back and started watching Salt Lake City because of this Genshaw prosecution. People wanted to play detective and go see if there were any clues in what they could put together. They all wanted to share in that oh my god moment.

But the cons Genshaw pulls are pretty complicated and so far removed from her that it's hard to track the actual crime. Some even say there is no crime and that she did nothing wrong. Of course, one of the people saying that in March of last year, anyway, is Genshaw herself. Here she is on the Real Housewives of Salt Lake City reunion show, addressing the federal case against her. She looks like a movie star ensconced in purple feathers shooting up from the top of her gown, anchored by

I'm fighting this she's I am innocent, and I will fight for every person out there. They can't fight for themselves because they don't have the resources or the means, so they they don't fight. I will fight because number one, I'm instant, and number two, I'm going to represent every other person out there that can't fight and hasn't been able to.

She really does sound like a falsely accused person trying to get out from under a tremendous injustice that the federal government has wrought against her. But make no mistake, she actually did do everything she's accused of doing. At this point, we know who the who is. It's Genshaw. We just can't figure out the when, the where, and the why. So I ask former prosecutor Emily D. Baker, if you had to explain to a five year old what Genshaw is guilty of what is her crime, what

Jenshaw stole money by lying. The types of lies and the way that the lies worked are a little more complex, but she lied and stole people's money based on those lies. If I was explaining it to like a nine year old, I'd be like, look, it's as if she was going to sell you a skin for Roadblocks.

A popular video game, and you.

Paid money for the skin, but then the Roblock skin never worked, and she's like, oh no, you just need this other program to make it work, and then sold you that program to make it work, and then that didn't work, and you were like, but this isn't working. It's like, oh no, but you need this other thing, so pay me for this other thing and then it will work. And then you end up down this chain of all these things you tried to do to make the one thing you wanted work that was never ever

Once they get your phone number, you are their best friend. They keep calling you NonStop until you know you Eventually you cave in.

That's Joseph L. Flatley a journalist who's written extensively about the kinds of telemarketing scams Jenshaw was masterminding, and about one of the companies in particular where Jenshaw got her start, a Utah company called Prosper.

What is Prosper.

It's essentially a high pressure sales floor. They say that they sell distance learning, So it's kind of like modern day versions of correspondence courses where if you want to work on anything from professional development to more like new age secret y course in miracles type stuff, you enlist in one of their programs and you get information in the mail, or you get coaching over the phone. But what we've found about Prospers products is that they're basically worthless.

It's like a bait and switch. Right, there is no real product. Right.

In the Utah Valley Magazine article day of July one, two thousand and eight, there's a write up about Genshaw and her work at Prosper, and the article includes a picture that barely looks like the Genshaw we all know. I'm posting it at Queen of the Con on Instagram so you can see the gen in that photo is uncharacteristically plain, dressed in what looks like an Ann Taylor worksuit, like she could be the head of HR for some big company or something. And she's quoted in that article.

Saying since starting with prosper I have been a maze at the quality of people we have here. Everyone is focused on delivering the best possible product to our students, and the camaraderie is invigorating. There's something special about working with people who are passionate.

In the early two thousands, prosper Inc. Was a Utah based telemarketing company that sold career coaching and worked from home instruction over the phone. They were also affiliated with the now defunct Trump University, selling scammy real estate classes.

We teach success.

That's what it's all about. Success, It's going to happen to you.

A lot of people who bought what prosper Ink sold have since filed complaints with the Federal Trade Commission and even filed lawsuits alleging fraud. Other prosper Ink customers have posted numerous complaints online.

We paid almost fourteen thousand dollars with the belief that we'd have a money website. We're much deeper in debt now than when we started, and our websites didn't earn any money. We're left feeling completely ripped off.

Prosper Learning is a scam.

The high pressure call with the success stories and the claim that we could reasonably expect to do that too is not true.

My elderly mother was swindled by this company as well, with non filed complaints with the FTC.

One of the most pernicious things about these products is that they tend to cost pretty much whatever you have on your credit line.

Joseph L. Flatley wrote a huge expose about prosper Inc. For The Verge, an online technology news publication.

It kind of exists in this legal area where if you don't look at it too closely, you think it is the legit side of the marketing industry, when in fact Internet marketing can be described as really just using the Internet as a tool for criminal con you know, selling people get rich quick schemes, selling people, getting people on mailing lists. So they're constantly being inundated by criminals

A boiler room is like a crowded office with rows and rows of workers crammed into desks, sometimes inches away from each other, all on the phone, desperately trying to make a sale.

Just like Prosper is scamming people for their money, they're also scamming their employees in a way. You join, you don't know that it's a boiler room or what a boiler room is. Oftentimes it's like, you know, I want a white collar job. Nobody in my family's ever had a white collar job. I can't go to Wall Street and get a job there, but I can start in one of these you know, sales floors in Utah and finally climb my way up into the you know, the

And in two thousand and eight, Jenshaw is one of those people who last and do really well, so well in fact, she eventually becomes Prosperous Director of Development.

I don't know how Jenshaw joined, and I don't know what she thought when she started working for the company, But I don't know how she lasted as long as she did without realizing just what an insane scam it all is.

Jenshaw eventually leaves prosper Inc. And works for several other telemarketing companies, including one called Thrive and another one called Guidance, running the same kinds of scams prosper inkran. Then it's not long before Jenshaw and the company she works for incur the wrath of the Federal Trade Commission. Back in twenty seventeen, she was a part of this FTC case

It was the same kind of business services.

Yes again, former Prosecutor Emily D.

Baker and those companies got shut down for their marketing practices. If jen had stopped there, this case probably wouldn't come up.

The current criminal case against her.

It's much easier for a federal prosecutor. And this is what I said from the moment we started seeing this information about the FTC case, is it's really easy to show intent that Jen knew this went beyond just marketing practices. When you have her confronted by another government agency in a deposition, questioning her about the business, and instead of stopping, she finds ways to be sneakier about it. So it makes it really easy to show intent with Jenshaw's actions.

After the FTC shuts down Thrive and Guidance, the company's Jenshaw held high positions at companies that were essentially scamming people. She conspires with her former bosses and starts her own telemarketing companies, one called Red Steel and another one called Learning Systems, using the same coercive techniques. She's kind of affected at this point to ultimately trick thousands of people out of millions of dollars.

I was ashamed, and I thought, you know, kind of smarter than that. I shouldn't have it shouldn't have happened to me.

That's sixty four year old Penny Pucket. She used to be a farmer in Kansas, and she was planning to retire soon with her husband. But jen Shaw's telemarketing scheme changed all that.

We probably will never be able to be retired. We'll have to work until it can't work anymore. Wow, we had to stop farming. We actually hold our part of the farm. We happened to have enough equity in our house that we was able to refinance so that we could get out from underneath the credit card debt.

Wow, I'm so sorry you lost all this money.

I'm so sorry.

It all starts back in twenty fourteen. You see, Penny has a knack for sewing baby carseat back in her spare time.

You would sew these car seat blankets by hand.

Yes, on a sewing machine.

But yeah, and Penny wants to start a business, a side hustle to the farming, really to make some extra money. So she googles around and eventually lands on one of the many websites that Genshaw and her network of sophisticated scammers create to lure the blankets sewing Penny Puckets of the world. In a few clicks and a few hundred dollars later, Penny is enrolled in an online course that's guaranteed to get her baby car seat blanket into the hands of paying customers all over the country.

Yes, it was a course that was designed to teach you how to market steff on social media.

But Penny has no idea that the Jenshaw underling who takes her contact information for what turned out to be a fake course because it doesn't actually help Penny sell any car seat blankets using social media at all, is sharing Pennies contact information with a bunch of other scammers working in unison to now scam Penny some more.

I started getting a lot of different phone calls, and these people are pretty smooth. They knew that you was going to have to put money in in order to get money, you know, kind of like a return on investment. So when they started telling me, well, maybe you need to do a website. You know, if you do a website,

And that's very clever of them, because at no point, and they're making you sign contracts and they're telling you hard numbers dollar amounts you'll be able to make, it seems like it's on the up and up right.

Yeah, yeah, Plus Penny is guaranteed she'll make at least one thousand dollars a week or her money back.

The operators they pump you for information.

Journalist Joseph L.

Flatley, and they find out you have five thousand dollars available on your visa card and the first tier is five thousand dollars. But if you really want to improve your life and you really want to benefit, you got to spend fifteen thousand dollars. So now you're going out of your way to get more credit or to get loans or whatever to morget your house. And there's never an end to the products, or I should say the products don't end until you're bankrupt.

And keep in mind, victims of this particular scam aren't worried about losing their money at all, because it's guaranteed. Here's a clip from an actual recording of one of these telemarketing scams in progress. The elderly victim here is concerned about the initial outlay of funds.

So she asks what happens if I don't make good money at this at.

The end of thirty at This recording, by the way, is from an investigative piece titled Scam World that Joseph L. Flatley wrote for The Verge.

At the end of thirty days, if you have not returned on your investment, we will give you a refund back. I was gonna say it's not a cash refund because it's on a credit card. It will be a refund, but you are guaranteed to make your money back. We have clients that actually within one week usually have a sale.

This is exactly why victims like Penny Puckett felt comfortable proceeding. It's a money back guarantee. What did she have to lose? So Penny lets the gen Shaw scammers charge eight thousand dollars to a credit card. Actually, they have Penny do a wire transfer from her credit card to them for eight thousand dollars you'll see why later. And they create what looks like a website for Penny and assure her that her baby car seat blankets will be selling like hotcakes very soon.

But after the second month, zero sales, then I started questioning things, and of course they had to do an LLC and then take another course on how to get them to draw themselves to that website. Like for Google, they had a service that would keep you at the top of Google Search and all of that, which made sense, but again there was more money out of your pocket.

And were you ever the top of a Google search? Did any of those things happen?

No?

In all, Penny gives them thirty thousand dollars three thousand here, four thousand there, believing she'll start selling her baby car seep blankets and have a thriving online business very soon. I mean, that's what they keep telling her.

It seems that they were praying on the vulnerable that didn't understand the Internet well, saying no, this is how the Internet works. You just need a website and then it generates leads and those leads generate money and it all just works. And then once people spend so much money in this is where that shame part comes in.

You have so much invested, you just need a little more to make it.

If I can just get back to the initial investment, I can get out.

When I started questioning them, they just, I mean, well, you didn't do your homework, and I'm not one of the sleft things, one of those you give me a project and I get it done.

But that was the first sign that something was off, that you weren't making any money, and you complained to them, and they turned it back on you. They blamed you.

Yeah, I was upset because they had told me what happen had happened, even though I had done everything that they had asked. And then that's when I started questioning the legitimacy of what was going on.

What actions did you take at this point? So you feel like you're not getting what they promised. It's kind of smelling like a scam.

What do you do?

I started disputing my credit cards because it was right at the one hundred and eighty day mark that you had to dispute it. But I found out that the first company they had me do a wired transfer on my card.

That's another layer of cleverness on their part because they're not charging your credit cards directly, they're having you essentially charge cash to your credit card and transfer it to them.

Right these scammers, working at the direction of the Queen of the con herself Jenshaw, know exactly what they're doing, as does Jen. Remember she's the one at the top scripting what these lower level scammers on the phone are telling victims like Pennypucket to keep milking them out of money.

I think what Genshaw was leaning into is this is just marketing. Okay, so we're lying in our marketing practices, but that's not wirefraud. You don't go to prison for that. You pay a fine and your business get shut down. I think Jen thought that was what was going to keep happening. After the FTC shut down her businesses, she got fined, and she's like, oh, we'll starting a business as.

One of the most important parts of the industry, if not the most important part, is making lists of people and whittling down those lists.

Journalist Joseph L. Flatley talking about what's referred to as lead lists.

If you have a product and somebody signs up for it just for information, that's great because you know they're interested. If they buy a product, that's great too, because you know they're buying stuff. You've already built them a little bit so that that lead is worth a little less money, and then they kind of winnow it down.

Another hook that I see is regarding jen Shaw and the companies she worked with and the lead lists that she sold to other companies, working in unison to scam all these people. The way in for a lot of the victims was almost self inflicted. They click the link work from home, make twenty thousand dollars work from home. So I imagine, you know human psychology. They think to themselves, well, it's not a scam because I asked for information, I

Well, I think the Internet was a huge boon to this, precisely because people didn't really understand how the Internet worked.

And I knew just enough to be dangerous.

Yep. But in the end, jen Shaw's telemarketing scammers have red Penny Pucket wrong. She's not taking what they did to her lying down. Yes she's upset, and yes she's now broke in the hole for thirty thousand dollars. She gets depressed with draws from life, but only licks her wounds for a couple days.

Then I got to thinking, well, now what can I do? So I filed to the Attorney general in the state of Kansas, and then I was told that I had to file the company with the state that these companies worked out of, so in this particular case, this one was Utah. So I spent hours and hours and hours filming out forms for all of the attorney General's offices all over. I went to the FTC, I went in you know, the better business hero ripoff dot com. I did all kinds of stuff, putting out notices that these

This all goes down in twenty fourteen. Pucket has no idea that Jenshaw and her network of telemarketing scammers are doing what they did to her to thousands of other people across the country. And while most of these victims are older like Penny, who's sixty four, some victims are in their thirties.

My name is Molly McLaughlin.

I live in Iowa and I was, unfortunately a victim of a scam from Jenshaw.

Did not know who it was at the time.

The sophistication Jenshaw's minions employ to trick Molly is just next level.

I personally thought I had done my research because obviously I knew that there were scams out there.

Next time, on Queen of the Khan.

People trade on information with the Feds. Someone gets picked up for something and goes to the FEDS. Look, yes, I get it, but can I tell you about this.

How jen Shaw gets on the radar of homeland security is a story for the ages.

We don't target anybody who are targeting the find We're following the facts. We know there's a corporation that's doing this, we know that there's organizations and people that are involved. Because not we're starting out. Let me look at Jenshaw. That's not what this investigation unraveled.

Portions of public statements from court records and from online complaints were dramatized verbatim in this episode. Queen of the Khan. The Unreal Housewife is a production of AYR Media and iHeartMedia, hosted by me Jonathan Walton. Executive producers Jonathan Walton for Jonathan Walton Productions and Eliza Rosen for AYR Media. Written by Jonathan Walton, Segment producer Gregory Harvey, Senior Associate producer