News Summary

Beauty Supply Institute (BSI), an Atlanta-based business, has been ordered to cease operations and pay nearly $2.2 million in penalties for violating Georgia’s Business Opportunities Act. A Fulton County court found BSI, along with its founder, Devin Robinson, engaged in unfair practices that led to significant financial harm for clients. Complaints from customers revealed serious issues, including unfulfilled orders and inadequate support. BSI claims it has done no wrongdoing, but investigations continue as many clients seek restitution for their losses in the beauty supply industry.

Atlanta

An Atlanta-based business, Beauty Supply Institute (BSI), has been ordered to cease operations and pay nearly $2.2 million in penalties following a year-long investigation conducted by state authorities. The decision was made by a Fulton County court after it found BSI, along with its founder, Devin Robinson, and another entity, Derobis Enterprises, violated the Business Opportunities Act by engaging in unfair or deceptive practices.

The state determined that BSI had committed several serious violations including failing to provide mandatory refunds to clients, not maintaining an active surety bond, and charging customers in advance of legal limits for services promised. Many clients of BSI reported facing dire financial consequences such as bankruptcies and home foreclosures after handing over substantial sums, often amounting to thousands of dollars, for consultations and products that did not materialize.

Customer complaints revealed widespread dissatisfaction with the company’s practices. Clients expressed frustrations regarding unfulfilled orders and accumulating credit card debts while waiting for shipments that frequently did not arrive. For instance, Shalanda Webb, a former client, was awarded a $500,000 judgment in December but has reportedly yet to receive any payment. Similarly, Kenitha Ferguson found herself paying $75,000 to BSI only to end up renting an empty retail space for close to a year without any products or support from the company.

As a response to the allegations, BSI claimed that its operations had not involved any wrongdoing, attributing certain delays to issues such as backorders and health-related challenges faced by the staff. Currently, BSI’s office located in Mableton is closed, and the company’s website indicates that its phone lines are down due to a system upgrade.

The Georgia Attorney General’s office is actively investigating BSI due to the penalties that have been assessed against the business, which are based on multiple claims filed against it as well as violations of the Fair Business Practices Act. The business asserts that it conducts its operations without malice, but has also issued threats of legal action against clients who have chosen to speak out about their experiences.

Additionally, BSI claims that a total of 116 store owners nationwide owe the company over $7 million in debts. Ferguson’s lawsuit specifically accuses BSI of breach of contract for failing to adhere to the agreements made, which has raised questions about the legitimacy of the contract terms as initially presented to clients.

Many clients have voiced their concerns over perceived inadequacies in support from regulatory agencies, stating that their complaints have received little to no response. The founder of BSI, Robinson, declared that personal circumstances, including his role as a caretaker for a terminally ill loved one, have significantly impacted the company’s operations, claiming this led to the eventual closure of his beauty supply store.

This situation highlights broader issues within the beauty supply industry, particularly regarding compliance with laws designed to protect consumers from deceptive business practices. As the investigation continues and penalties are enforced, many former clients of BSI remain hopeful for resolution and restitution.

Deeper Dive: News & Info About This Topic

• Fox 5 Atlanta
• Wikipedia: Beauty Supply
• 11 Alive
• Google Search: Beauty Supply Institute
• Black Enterprise
• Google Scholar: Beauty Supply Lawsuits
• WSB TV
• Encyclopedia Britannica: Beauty Supply Industry
• Atlanta News First
• Google News: Beauty Supply Scam