Jesse Willms

Early life

Willms was born in the Alberta countryside in 1987. His mother Linda worked as a revenue property manager, and his father Dave ran a welding-equipment company. According to his mother, Willms developed an early interest in business and trade. At the age of 3 or 4, whenever he went along with his mother to the grocery store, he would make her guide him through each step in the money transaction. A few years later, he spent his paper route wages on business books, learning about how various well-known businessmen, like Warren Buffett, had attained their fortune.

In the early 1990s his family moved to Sherwood Park, an Edmonton suburb. According to his mother, Willms spent a lot of time by himself in the backyard, and despite doing well in school, he never showed any real interest in his studies.

eDirect Software

Willms started his first business in 2003, at the age of 16. Through an online storefront, eDirect Software, Willms, along with an assembled staff of a dozen people, sold copies of computer software that he had obtained relatively inexpensively from the Jordanian government. The software sold was mainly cheap copies of Microsoft Office, and before long eDirect was one of the largest resellers of Microsoft products on the Internet.

Lawsuit

Within two years, in March 2006, Microsoft filed a lawsuit against the then 18-year-old Willms, accusing him of dealing in large amounts of “counterfeit, tampered and/or infringing” copies of Microsoft’s products. Through a court order, Microsoft went through Willms’ PayPal account and discovered that it contained more than $200,000. Microsoft also reviewed eDirect’s software inventories, where they found approximately 66,000 questionable Microsoft products. In February 2007, Willms agreed to a six-figure settlement.

Just Think Media

After the Microsoft incident, Willms soon thought of a new business idea. The problem with eDirect had been that all of the products he was selling were not, in practice, his. By going through vast quantities of popular web searches, he attempted to find out the top desire of people in order to venture upon the appropriate product. The result was weight-loss products. Using the name of an already existing Chinese tea, supposedly good for burning fat, Willms started to sell his own white-label product tea under the new company name Just Think Media. The tea was marketed and sold through several web sites. The business became such a success that Willms quickly launched other types of alleged health products, such as colon cleansers, teeth whiteners, and acai supplements. The web pages that were used to sell the products were filled with “scientific proof” and alleged endorsements from celebrities and TV networks. At its peak in 2009, Just Think Media earned more than $100 million in revenue and had only 20 employees.

FTC investigation

By late 2009, the Federal Trade Commission (FTC) initiated an investigation to scrutinise Willms’ businesses. The impetus for the investigation was the fact that Willms’ companies had received nearly the most consumer-complaints of all Internet businesses at the time. According to the FTC investigation, the majority of Willms’ profit came from negative option billing, "a practice in which the seller interprets consumers' silence or inaction as permission to charge them". In effect, this meant that consumers signing up for "free trials" of a product were charged with extra fees hidden in the fine print of the terms and conditions. Often consumers became aware of this first after their credit cards had been charged and it was already too late. What made it harder for the victims to realize that they were charged by Willms' business, was the fact that several different company names appeared on their statement of accounts, charging uneven dollar amounts, which made them seem like real purchases. These charges, FTC claimed, made up some of Willms' biggest profits, since consumers believed the charges were legitimate.

Lawsuit

In May 2011, FTC filed a lawsuit against Willms, after an 18 months long investigation. The lawsuit claimed that Willms, from 2007 to 2011, had been conning customers in the U.S., Canada, Australia, Britain and New Zealand of approximately $467 million. In September 2011, a U.S. District Court Judge froze Willms' assets and prohibited him from continuing to sell products through negative-option. In early 2012, Willms acquiesced to a $359 million settlement. As part of the settlement, Willms also agreed to sell off personal property, including his mansion.