The US Securities and Exchange Commission froze the assets of Ken Courtright's company Todays Growth Consultant which also operated as The Income Store.
The commission has filed an emergency enforcement action, obtained a temporary restraining order and asset freeze against Courtright.
It is alleging that The Income Store was, for all intents and purposes, a Ponzi scheme.
The scheme apparently raised about US $75 million for more than 500 investors.
Courtright and his company promised investors an endless minimum guaranteed rate of return on revenues generated by websites.
In exchange for an upfront fee, the company would buy or build a website for the investor. The company falsely promised it would use the fees for expenses related to the website.
In reality, the SEC alleges new investor funds were used to pay returns for older investors - in a Ponzi-like fashion.
Courtright allegedly also used the money to pay off his own mortgage and to send his children to expensive private schools.
"Todays Growth Consultant and Courtright's alleged fraud promised a guaranteed return when the company's business model and financial condition could not possibly support it," said SEC associate director Antonia Chion.
"To avoid further harm to investors and preserve the misused assets that have not already been dissipated, we have sought and obtained emergency relief."
The sales pitch for how exactly the websites would generate income is unclear, however, there is still evidence on Courtright's site of claims that websites could generate ongoing income.
A Reddit user reported investing $100,000 through The Income Store and being promised a guaranteed return of 15%.
There is still evidence on Courtright's site of claims that websites could generate ongoing income.
Four years after making the initial investment, the user said the website that had been purchased for them now appeared to be worthless.
The promise that customers would own the website was apparently touted as security.
YouTube user Emilia Gardner, a former lawyer, shared a series of videos attempting to warn people off schemes like The Income Store.
One thing she uncovered was that Courtright had previously filed for bankruptcy.
Courtright self-published three books - Online income: Navigating the internet mindfield, Business growth strategies you've never heard of and Against the grain.