The founder of a West Ridge company has been accused of running a massive nationwide scam that netted tens of millions of dollars from over 100,000 consumers, according to a lawsuit filed by the Federal Trade Commission and the state of Illinois.
Owner Yosef Banath, 34, and his company B.E.S.T. GDR, operating as Premium Home Service, created more than 15,000 fake businesses that would appear on search engines, such as Google, to entice consumers needing home repairs, according to the complaint filed Monday in U.S. District Court for the Northern District of Illinois. Minnesota’s attorney general filed a similar lawsuit against the company earlier this week.
Premium Home Service is accused of violating consumer protection laws. Records show the company’s primary address, 6723 N. Sacramento Ave., is a home owned by Howard and Jeanne Bernath, also known as Chaim and Rivkah Leah Bernath, who purchased the home in 1994. The owners didn’t answer the door when contacted by the Sun-Times.
Banath didn’t respond to requests for comment.
Since at least 2018, Banath has operated fake business profiles — with at least hundreds in the Chicago area — that would appear as local companies offering same-day services for plumbing, HVAC or electrical work. The profiles — like Ron’s Plumbing and Rodding near Roseland or Levine Heating and Cooling in Buffalo Grove — would appear as a small business located near the consumer, with an address, local phone number and five-star rating.
“When consumers call one of Defendants’ over 7,600 telephone numbers in over 250 area codes across the United States, Defendants route the calls to their customer service representatives, who typically have been located outside of the United States,” the complaint said.
The agent would schedule the requested service, usually within a three-hour window, and require customers to pay a service fee ranging from $49 to $149. Customers could instead sign up for an annual membership for about the same price as the service fee, receiving benefits such as no service fees on additional visits. Once booked, Premium Home Service would attempt to find subcontractors to perform the work.
But customers reported no one would show up. In some cases, an unlicensed technician would appear or someone unqualified to perform repairs — forcing the customer to hire another company to correct or complete the work.
The lawsuit said one Illinois customer needed to repair a thermostat for their floor heating system. They contacted what they believed was a local electrical company, but what was in fact a fake business created by Premium Home Service. Besides paying the membership fee, that particular customer also was charged $175 for about 10 to 15 minutes of work.
“Shortly after the technician left, however, the consumer smelled something burning from the basement where the service provider had been working. The consumer discovered the basement wall where the floor heating system thermostat was located was hot to the touch and emitting smoke. The consumer had to hire another company that charged him hundreds of additional dollars to correctly complete the repairs,” the complaint said.
Premium Home Service’s website touts their “essential services” as being done “in house,” without subcontractors.
Disgruntled customers trying to visit one of the fake business would find a different business — or in some instances, an empty site — at that address.
For example, the address listed for Premium Home Service’s “Mason Heating & Air Conditioning” is the site of the historic Woodstock Fountain in Woodstock, about 50 miles northwest of Chicago. The address provided for Adani Electrical Services in Round Lake, west of Waukegan, is a wine bar.
Similar cases were found in other states, the complaint said. The location of a New Jersey garbage collection business, created by Premium Home Service, was a yarn and needlepoint boutique, and a Florida electrical company was a building with an Arby’s and a Verizon store.
Online groups have formed over the years to spread the word about Banath and Premium Home Service, including one website dedicated to warning other consumers. The website lists more than 3,000 fake businesses by Premium Home Service in Illinois, with over 200 in Chicago.
One online review for Duncan Heating & Air Conditioning in Oak Park said they spent a night freezing in their home, after being assured someone would arrive to fix their heat. Out of 64 reviews, Duncan has 19 one-star reviews and 45 offering rave reviews.
Banath said he knew “there were reviews created by some third parties which were not legitimately produced by customers,” according to the complaint. The fake five-star reviews were posted by Banath, employees and relatives. They sometimes used images of real people — like a professor at a North Carolina university — paired with fictitious names.
“Premium Home Service spent years establishing fake businesses with fake reviews to lure in customers who were in need of home repairs,” Illinois Attorney General Kwame Raoul said in a news release. “Individuals who scam the unsuspecting public have no place in our communities, and I appreciate the partnership of the Federal Trade Commission and the Department of Justice in working to hold this company accountable.”