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FTC Press Releases

  • FTC Alleges Operators of Two Commercial Websites Failed to Protect Consumers’ Data


    by jwolf on April 24, 2019 at 12:00 pm

    In separate cases, ClixSense and i-Dressup.com agree to settle charges that they failed to provide reasonable data security
    The operators of an online rewards website and a dress-up games website have separately agreed to settle Federal Trade Commission allegations that they failed to take reasonable steps to secure consumers’ data, which allowed hackers to breach both websites.In a complaint filed by the Department of Justice on behalf of the Commission, the FTC alleged that the operators of i-Dressup.com violated the Children’s Online Privacy Protection Act (COPPA) by failing to obtain parental consent before collecting personal information from children under 13 and failing to provide reasonable security for the data i-Dressup collected.In a separate action against the operators of the online rewards website ClixSense.com, the FTC alleged that the website’s inadequate security allowed hackers to gain access to consumers’ sensitive information through the company’s network.Allegations against ClixSenseClixSense pays its users to view advertisements, perform online tasks, and complete online surveys. The company collects personal information from users, such as their full names, dates of birth, email and postal addresses, usernames, passwords, and answers to security questions, as well as Social Security numbers for those who make more than $600 a month.In its complaint against ClixSense, the FTC alleges that the website’s operator, James V. Grago, Jr., deceived consumers by falsely claiming that ClixSense “utilizes the latest security and encryption techniques to ensure the security of your account information.” In fact, ClixSense failed to implement minimal data security measures and stored personal information in clear text with no encryption. The complaint also alleges that ClixSense failed to implement readily available measures to limit access between computers on ClixSense’s network; failed to change default login and password credentials for third-party company network resources; and maintained consumers’ personal information, including consumers’ names, dates of birth, answers to security questions, login and password credentials, and Social Security numbers, in clear text.The FTC alleges that ClixSense’s failures allowed hackers to gain access to the company’s network through a browser extension that ClixSense downloaded. The complaint notes that ClixSense was put on notice that the company’s network was compromised based on clues left by the hackers. For example, hackers accessed documents, email accounts, and credentials stored on employee laptops; changed employees’ logins and passwords; redirected email notifications for multiple network accounts, including ClixSense’s cloud and Domain Name System (DNS) host services; and redirected visitors to the ClixSense website to an unaffiliated adult-themed website.As a result of ClixSense’s data security failures, the hackers downloaded a document from ClixSense that contained clear text information regarding 6.6 million consumers, including some 500,000 U.S. consumers. The hackers then published and offered for sale, on a website known for posting security exploits, personal information pertaining to approximately 2.7 million consumers, including full names and physical addresses, dates of birth, gender, answers to security questions, email addresses and passwords, as well as hundreds of Social Security numbers.As part of the settlement, Grago is prohibited from misrepresenting the extent to which any company he controls protects the privacy, security, confidentiality, or integrity of personal information it collects. If any company he controls collects or maintains personal information, Grago must implement a comprehensive information security program and obtain independent biennial assessments of this program. In addition, Grago also is prohibited from making misrepresentations to the third party performing the biennial assessments of any information security program, and must provide an annual certification of compliance to the Commission.Allegations against i-DressupThe FTC alleges that Unixiz, Inc., doing business as i-Dressup.com, and the individually named defendants CEO Zhijun Liu and Secretary Xichen Zhang, violated COPPA by failing to obtain parental consent before collecting personal information from children under 13 and provide reasonable and appropriate security for the data i-Dressup collected.The i-Dressup.com website allowed users, including children, to play dress-up games, design clothes, and decorate their online spaces. It also included an online community where users could create personal profiles and interact with other users.To gain access to all the features on the website, including the social features, users had to register as members, requiring them to submit a user name, password, birthdate, and email address. If a user indicated he or she was under 13, the registration field asked for a parent’s email. When a user clicked the “Join Now” button, an email notice was sent to the parental email address the user entered. In that email, parents could provide consent by clicking the “Activate Now” button in the email.If a parent declined to provide consent, the under-13 users were given a “Safe Mode” membership allowing them to login to access i-Dressup’s games and features but not its social features. The FTC alleges, however, that i-Dressup still collected personal information from these children even if their parents did not provide consent.In addition to violating the parental consent requirements, the FTC also alleges that i-Dressup and its operators failed to comply with COPPA’s requirement to keep the data it collected secure. The FTC alleges i-Dressup stored and transmitted users’ personal information in plain text and failed to perform vulnerability testing of its network, implement an intrusion detection and prevention system, and monitor for potential security incidents. These failures led to a security breach. The operators of i-Dressup discovered in September 2016 that a hacker had accessed their computer network and information about consumers, including children who used i-Dressup. The hacker accessed the information of approximately 2.1 million users—including approximately 245,000 users who indicated they were under 13.As part of the proposed settlement with the FTC, i-Dressup and its owners have agreed to pay $35,000 in civil penalties, and are prohibited from violating COPPA. In addition, they are barred from selling, sharing, or collecting any personal information until they implement a comprehensive data security program to protect the information and obtain independent biennial assessments of this program. They also are prohibited from making misrepresentations to the third party performing the assessments of the information security program, and must provide an annual certification of compliance to the Commission.The Commission vote authorizing the staff to file the i-Dressup federal complaint and stipulated final order was 5-0. The complaint and stipulated final order was filed in the U.S. District Court for the Northern District of California. The Commission files a federal court complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. Stipulated final orders have the force of law when approved and signed by the District Court judge.The Commission vote to issue the administrative complaint and to accept the consent agreement with ClixSense was 5-0. The FTC will publish a description of the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent order final. Once processed, comments will be posted on Regulations.gov.The Commission also issued a statement on both cases.NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530. […]

  • FTC Charges Surescripts with Illegal Monopolization of E-Prescription Markets


    by jwolf on April 24, 2019 at 12:00 pm

    Company used its digital platform to impose anticompetitive vertical and horizontal restraints on commerce, leading to higher prices and reduced consumer choice, agency alleges
    The Federal Trade Commission sued the health information company Surescripts, alleging that the company employed illegal vertical and horizontal restraints in order to maintain its monopolies over two electronic prescribing, or “e-prescribing,” markets: routing and eligibility.The FTC’s complaint against Surescripts, filed in federal court on April 17, 2019, is the latest example of the agency’s commitment to stopping anticompetitive tactics in the health care industry that harm consumers and raise the cost of care for Americans. In February, the FTC reached a a global settlement with the pharmaceutical manufacturer Teva Pharmaceuticals Industries Ltd., barring the company from engaging in reverse-payment patent settlement agreements that block consumers’ access to lower-priced generic drugs. Last month, the Commission barred another pharmaceutical company, Impax Laboratories LLC, from entering into reverse-payment patent settlements after concluding that Impax used this tactic to block consumers’ access to a generic version of the extended-release opioid pain reliever Opana ER. And in a record court victory for the Commission last year, a federal court ordered another pharmaceutical company, AbbVie Inc., to pay $448 million to consumers who overpaid for testosterone replacement drug Androgel because of AbbVie’s illegal tactics to maintain its monopoly over the drug.In the complaint filed on April 17, 2019 against Surescripts, the FTC is seeking to undo and prevent Surescripts’s unfair methods of competition, restore competition, and provide monetary redress to consumers.“For the past decade, Surescripts has used a series of anticompetitive contracts throughout the e-prescribing industry to eliminate competition and keep out competitors,” said Bureau of Competition Director Bruce Hoffman. “Surescripts’s illegal contracts denied customers and, ultimately, patients, the benefits of competition – including lower prices, increased output, thriving innovation, higher quality, and more customer choice. Through this litigation, we hope to eliminate the anticompetitive conduct, open the relevant markets to competition, and redress the harm that Surescripts’s conduct has caused.”E-prescribing provides a safer, more accurate, and lower-cost means to communicate and process patient prescriptions than traditional paper prescribing. According to the complaint, Surescripts monopolized two separate markets for e-prescription services:The market for routing e-prescriptions, which uses technology that enables health care providers to send electronic prescriptions directly to pharmacies;The market for determining eligibility, a separate service that enables health care providers to electronically determine patients’ eligibility for prescription coverage through access to insurance coverage and benefits information, usually through a pharmacy benefit manager.The FTC alleges that Surescripts intentionally set out to keep e-prescription routing and eligibility customers on both sides of each market from using additional platforms (a practice known as multihoming) using anticompetitive exclusivity agreements, threats, and other exclusionary tactics. Among other things, the FTC alleges that Surescripts took steps to increase the costs of routing and eligibility multihoming through loyalty and exclusivity contracts.According to the FTC’s complaint, Surescripts successfully used these tactics to stop multiple attempts by other companies to enhance competition in the routing and eligibility markets. According to the FTC’s complaint, Surescripts’s anticompetitive tactics thwarted competitors from gaining share in the routing and eligibility markets, enabling the company to maintain at least a 95 percent share in each market over many years. The complaint alleges that Surescripts succeeded in maintaining its monopolies in routing and eligibility, despite the explosive growth of routing and eligibility transactions – from nearly 70 million routing transactions in 2008 to more than 1.7 billion in 2017.The Commission vote to file the complaint was 5-0. The complaint was filed under seal in the U.S. District Court for the District of Columbia on April 17, 2019. A redacted version of the complaint was also filed. The complaint alleges that Surescripts’s anticompetitive acts violate Section 2 of the Sherman Act, and thus constitute an unfair method of competition, in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a).NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the federal district court.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about how competition benefits consumers or file an antitrust complaint. Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]

  • FTC Announces Agenda for May Forum on Small Business Financing


    by jwolf on April 22, 2019 at 12:00 pm

    The Federal Trade Commission has released the agenda for its May 8 event, Strictly Business: An FTC Forum on Small Business Financing. The forum will explore trends and consumer protection issues in the small business financing marketplace, including the recent proliferation of online loans and alternative financing products.Commissioner Rohit Chopra will give opening remarks at the forum, followed by three panel discussions. The first panel will provide an overview of the small business financing marketplace. The second panel will examine merchant cash advances. The last panel will explore consumer protection risks, applicable laws, and efforts to better protect consumers. Andrew Smith, Director of the FTC’s Bureau of Consumer Protection, will deliver closing remarks.The forum, which is free and open to the public, will be held at the Constitution Center, 400 7th St., SW, Washington, D.C. The event will be webcast live. A webcast link will be posted on the FTC homepage and on the event page on the day of the event.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]

  • FTC Approves Final Consents Settling Charges that Hockey Puck Seller, Companies Selling Recreational and Outdoor Equipment Made False ‘Made in USA’ Claims


    by rcuster on April 17, 2019 at 12:00 pm

    Following public comment periods, the Federal Trade Commission has approved final consent orders in two cases in which the agency alleged that companies falsely claimed their products were made in the United States.Patriot Puck: First announced in September 2018, the FTC’s complaint against four related Farmingdale, New York-based companies doing business as Patriot Puck alleged that the companies made false claims that their hockey pucks were all or virtually all made in the United States. According to the complaint, which names George Statler III as an officer of all the companies, Patriot Puck’s claims in its advertising, packaging, and promotional materials included “Made in America,” “Proudly Made in the USA,” “100% American Made!” and “The only American Made Hockey Puck!”Sandpiper, PiperGear: First announced in September 2018, the FTC’s complaint against California companies Sandpiper of California, Inc. and PiperGear USA, Inc. alleged that the companies claimed in advertisements, product labels, and promotional materials, and on company websites and social media, that their backpacks, travel bags, wallets, and other products were all or virtually all made in the United States.But according to the complaint, more than 95 percent of Sandpiper’s products were imported as finished goods, and approximately 80 percent of PiperGear’s products either were imported as finished goods, or contained significant imported components. And in some wallets imported as finished goods, the companies hid truthful country-of-origin information on the back of tags, and inserted cards that prominently displayed false U.S.-origin claims, the complaint alleged.Under the terms of the final orders, Statler and the four Patriot Puck companies, as well as Sandpiper and PiperGear, are prohibited from making unqualified U.S.-origin claims for their products, unless they can show that the products’ final assembly or processing—and all significant processing—takes place in the United States, and that all or virtually all ingredients or components of the product are made and sourced in the United States.Under the orders, any qualified Made in USA claim must include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients, and/or processing. To claim that a product is assembled in the United States, the respondents in both cases must ensure that it is last substantially transformed in the United States, its principal assembly takes place in the United States, and United States assembly operations are substantial.The orders also prohibit the respondents from making untrue, misleading, or unsubstantiated country-of-origin claims in their marketing materials about any product or service.The Commission has an Enforcement Policy Statement on U.S. Origin Claims, and other business guidance on how companies can comply with the “Made in the USA” standard. The FTC’s Made in the USA page features cases, instructive closing letters, and the brochure Complying with the Made in USA Standard, which answers many of the questions companies ask.The Commission voted 3-2 to approve the final orders in both of these cases. Chairman Joseph J. Simons issued a concurring statement. Commissioners Rohit Chopra and Rebecca Kelly Slaughter voted no. Commissioner Chopra issued a dissenting statement on Patriot Puck, and another on Sandpiper, PiperGear. Commissioner Slaughter issued a dissenting statement. (FTC File Nos. 182 3113 (Patriot Puck) and 182 3095 (Sandpiper, PiperGear)); the staff contact is Julia Solomon Ensor, Bureau of Consumer Protection, 202-326-2377.) […]

  • FTC Returns More than $1 Million to Victims of Bobby J. Robinson’s Work-at-Home Scheme


    by rcuster on April 16, 2019 at 12:00 pm

    The Federal Trade Commission is mailing checks totaling nearly $1.1 million to 87,256 consumers who paid for work-at-home opportunities based on the allegedly deceptive advertising practices of Bob Robinson, LLC and other related defendants. The defendants operated under various brand names, including Work At Home EDU, Work At Home Program, Work At Home Ecademy, Work At Home University, Work At Home Revenue, and Work at Home Institute.The refunds stem from an FTC settlement in which the defendants used online “native” advertising—promotional content that resembles the non-advertising material beside it—to reach consumers who were researching work-at-home opportunities on the internet. The defendants routinely claimed people could earn “hundreds of dollars per hour from home, without any special skills or experience.” The FTC alleged the defendants failed to make certain required disclosures to help consumers evaluate the business opportunity, and made false and unsubstantiated earnings claims.Consumers who have questions about the refunds should contact the FTC’s refund administrator, Analytics LLC, at 844-836-7130. Recipients should deposit or cash checks within 60 days, as indicated on the check. The FTC never requires people to pay money or provide account information to cash a refund check.FTC law enforcement actions led to more than $2.3 billion in refunds for consumers in a one-year period between July 2017 and June 2018. To learn more about the FTC’s refund program, visit www.ftc.gov/refunds.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]


FTC – Consumer Protection Press Releases

  • FTC Alleges Operators of Two Commercial Websites Failed to Protect Consumers’ Data


    by jwolf on April 24, 2019 at 12:00 pm

    In separate cases, ClixSense and i-Dressup.com agree to settle charges that they failed to provide reasonable data security
    The operators of an online rewards website and a dress-up games website have separately agreed to settle Federal Trade Commission allegations that they failed to take reasonable steps to secure consumers’ data, which allowed hackers to breach both websites.In a complaint filed by the Department of Justice on behalf of the Commission, the FTC alleged that the operators of i-Dressup.com violated the Children’s Online Privacy Protection Act (COPPA) by failing to obtain parental consent before collecting personal information from children under 13 and failing to provide reasonable security for the data i-Dressup collected.In a separate action against the operators of the online rewards website ClixSense.com, the FTC alleged that the website’s inadequate security allowed hackers to gain access to consumers’ sensitive information through the company’s network.Allegations against ClixSenseClixSense pays its users to view advertisements, perform online tasks, and complete online surveys. The company collects personal information from users, such as their full names, dates of birth, email and postal addresses, usernames, passwords, and answers to security questions, as well as Social Security numbers for those who make more than $600 a month.In its complaint against ClixSense, the FTC alleges that the website’s operator, James V. Grago, Jr., deceived consumers by falsely claiming that ClixSense “utilizes the latest security and encryption techniques to ensure the security of your account information.” In fact, ClixSense failed to implement minimal data security measures and stored personal information in clear text with no encryption. The complaint also alleges that ClixSense failed to implement readily available measures to limit access between computers on ClixSense’s network; failed to change default login and password credentials for third-party company network resources; and maintained consumers’ personal information, including consumers’ names, dates of birth, answers to security questions, login and password credentials, and Social Security numbers, in clear text.The FTC alleges that ClixSense’s failures allowed hackers to gain access to the company’s network through a browser extension that ClixSense downloaded. The complaint notes that ClixSense was put on notice that the company’s network was compromised based on clues left by the hackers. For example, hackers accessed documents, email accounts, and credentials stored on employee laptops; changed employees’ logins and passwords; redirected email notifications for multiple network accounts, including ClixSense’s cloud and Domain Name System (DNS) host services; and redirected visitors to the ClixSense website to an unaffiliated adult-themed website.As a result of ClixSense’s data security failures, the hackers downloaded a document from ClixSense that contained clear text information regarding 6.6 million consumers, including some 500,000 U.S. consumers. The hackers then published and offered for sale, on a website known for posting security exploits, personal information pertaining to approximately 2.7 million consumers, including full names and physical addresses, dates of birth, gender, answers to security questions, email addresses and passwords, as well as hundreds of Social Security numbers.As part of the settlement, Grago is prohibited from misrepresenting the extent to which any company he controls protects the privacy, security, confidentiality, or integrity of personal information it collects. If any company he controls collects or maintains personal information, Grago must implement a comprehensive information security program and obtain independent biennial assessments of this program. In addition, Grago also is prohibited from making misrepresentations to the third party performing the biennial assessments of any information security program, and must provide an annual certification of compliance to the Commission.Allegations against i-DressupThe FTC alleges that Unixiz, Inc., doing business as i-Dressup.com, and the individually named defendants CEO Zhijun Liu and Secretary Xichen Zhang, violated COPPA by failing to obtain parental consent before collecting personal information from children under 13 and provide reasonable and appropriate security for the data i-Dressup collected.The i-Dressup.com website allowed users, including children, to play dress-up games, design clothes, and decorate their online spaces. It also included an online community where users could create personal profiles and interact with other users.To gain access to all the features on the website, including the social features, users had to register as members, requiring them to submit a user name, password, birthdate, and email address. If a user indicated he or she was under 13, the registration field asked for a parent’s email. When a user clicked the “Join Now” button, an email notice was sent to the parental email address the user entered. In that email, parents could provide consent by clicking the “Activate Now” button in the email.If a parent declined to provide consent, the under-13 users were given a “Safe Mode” membership allowing them to login to access i-Dressup’s games and features but not its social features. The FTC alleges, however, that i-Dressup still collected personal information from these children even if their parents did not provide consent.In addition to violating the parental consent requirements, the FTC also alleges that i-Dressup and its operators failed to comply with COPPA’s requirement to keep the data it collected secure. The FTC alleges i-Dressup stored and transmitted users’ personal information in plain text and failed to perform vulnerability testing of its network, implement an intrusion detection and prevention system, and monitor for potential security incidents. These failures led to a security breach. The operators of i-Dressup discovered in September 2016 that a hacker had accessed their computer network and information about consumers, including children who used i-Dressup. The hacker accessed the information of approximately 2.1 million users—including approximately 245,000 users who indicated they were under 13.As part of the proposed settlement with the FTC, i-Dressup and its owners have agreed to pay $35,000 in civil penalties, and are prohibited from violating COPPA. In addition, they are barred from selling, sharing, or collecting any personal information until they implement a comprehensive data security program to protect the information and obtain independent biennial assessments of this program. They also are prohibited from making misrepresentations to the third party performing the assessments of the information security program, and must provide an annual certification of compliance to the Commission.The Commission vote authorizing the staff to file the i-Dressup federal complaint and stipulated final order was 5-0. The complaint and stipulated final order was filed in the U.S. District Court for the Northern District of California. The Commission files a federal court complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. Stipulated final orders have the force of law when approved and signed by the District Court judge.The Commission vote to issue the administrative complaint and to accept the consent agreement with ClixSense was 5-0. The FTC will publish a description of the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent order final. Once processed, comments will be posted on Regulations.gov.The Commission also issued a statement on both cases.NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $42,530. […]

  • FTC Announces Agenda for May Forum on Small Business Financing


    by jwolf on April 22, 2019 at 12:00 pm

    The Federal Trade Commission has released the agenda for its May 8 event, Strictly Business: An FTC Forum on Small Business Financing. The forum will explore trends and consumer protection issues in the small business financing marketplace, including the recent proliferation of online loans and alternative financing products.Commissioner Rohit Chopra will give opening remarks at the forum, followed by three panel discussions. The first panel will provide an overview of the small business financing marketplace. The second panel will examine merchant cash advances. The last panel will explore consumer protection risks, applicable laws, and efforts to better protect consumers. Andrew Smith, Director of the FTC’s Bureau of Consumer Protection, will deliver closing remarks.The forum, which is free and open to the public, will be held at the Constitution Center, 400 7th St., SW, Washington, D.C. The event will be webcast live. A webcast link will be posted on the FTC homepage and on the event page on the day of the event.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]

  • FTC Approves Final Consents Settling Charges that Hockey Puck Seller, Companies Selling Recreational and Outdoor Equipment Made False ‘Made in USA’ Claims


    by rcuster on April 17, 2019 at 12:00 pm

    Following public comment periods, the Federal Trade Commission has approved final consent orders in two cases in which the agency alleged that companies falsely claimed their products were made in the United States.Patriot Puck: First announced in September 2018, the FTC’s complaint against four related Farmingdale, New York-based companies doing business as Patriot Puck alleged that the companies made false claims that their hockey pucks were all or virtually all made in the United States. According to the complaint, which names George Statler III as an officer of all the companies, Patriot Puck’s claims in its advertising, packaging, and promotional materials included “Made in America,” “Proudly Made in the USA,” “100% American Made!” and “The only American Made Hockey Puck!”Sandpiper, PiperGear: First announced in September 2018, the FTC’s complaint against California companies Sandpiper of California, Inc. and PiperGear USA, Inc. alleged that the companies claimed in advertisements, product labels, and promotional materials, and on company websites and social media, that their backpacks, travel bags, wallets, and other products were all or virtually all made in the United States.But according to the complaint, more than 95 percent of Sandpiper’s products were imported as finished goods, and approximately 80 percent of PiperGear’s products either were imported as finished goods, or contained significant imported components. And in some wallets imported as finished goods, the companies hid truthful country-of-origin information on the back of tags, and inserted cards that prominently displayed false U.S.-origin claims, the complaint alleged.Under the terms of the final orders, Statler and the four Patriot Puck companies, as well as Sandpiper and PiperGear, are prohibited from making unqualified U.S.-origin claims for their products, unless they can show that the products’ final assembly or processing—and all significant processing—takes place in the United States, and that all or virtually all ingredients or components of the product are made and sourced in the United States.Under the orders, any qualified Made in USA claim must include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients, and/or processing. To claim that a product is assembled in the United States, the respondents in both cases must ensure that it is last substantially transformed in the United States, its principal assembly takes place in the United States, and United States assembly operations are substantial.The orders also prohibit the respondents from making untrue, misleading, or unsubstantiated country-of-origin claims in their marketing materials about any product or service.The Commission has an Enforcement Policy Statement on U.S. Origin Claims, and other business guidance on how companies can comply with the “Made in the USA” standard. The FTC’s Made in the USA page features cases, instructive closing letters, and the brochure Complying with the Made in USA Standard, which answers many of the questions companies ask.The Commission voted 3-2 to approve the final orders in both of these cases. Chairman Joseph J. Simons issued a concurring statement. Commissioners Rohit Chopra and Rebecca Kelly Slaughter voted no. Commissioner Chopra issued a dissenting statement on Patriot Puck, and another on Sandpiper, PiperGear. Commissioner Slaughter issued a dissenting statement. (FTC File Nos. 182 3113 (Patriot Puck) and 182 3095 (Sandpiper, PiperGear)); the staff contact is Julia Solomon Ensor, Bureau of Consumer Protection, 202-326-2377.) […]

  • FTC Returns More than $1 Million to Victims of Bobby J. Robinson’s Work-at-Home Scheme


    by rcuster on April 16, 2019 at 12:00 pm

    The Federal Trade Commission is mailing checks totaling nearly $1.1 million to 87,256 consumers who paid for work-at-home opportunities based on the allegedly deceptive advertising practices of Bob Robinson, LLC and other related defendants. The defendants operated under various brand names, including Work At Home EDU, Work At Home Program, Work At Home Ecademy, Work At Home University, Work At Home Revenue, and Work at Home Institute.The refunds stem from an FTC settlement in which the defendants used online “native” advertising—promotional content that resembles the non-advertising material beside it—to reach consumers who were researching work-at-home opportunities on the internet. The defendants routinely claimed people could earn “hundreds of dollars per hour from home, without any special skills or experience.” The FTC alleged the defendants failed to make certain required disclosures to help consumers evaluate the business opportunity, and made false and unsubstantiated earnings claims.Consumers who have questions about the refunds should contact the FTC’s refund administrator, Analytics LLC, at 844-836-7130. Recipients should deposit or cash checks within 60 days, as indicated on the check. The FTC never requires people to pay money or provide account information to cash a refund check.FTC law enforcement actions led to more than $2.3 billion in refunds for consumers in a one-year period between July 2017 and June 2018. To learn more about the FTC’s refund program, visit www.ftc.gov/refunds.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]

  • Online Lending Company Agrees to Settle FTC Charges It Engaged in Deceptive and Unfair Loan Servicing Practices


    by jwolf on April 15, 2019 at 12:00 pm

    Avant to pay $3.85 million for harming thousands of consumers
    Avant, LLC, an online lending company, has agreed to settle the Federal Trade Commission’s charges that it engaged in deceptive and unfair loan servicing practices, such as imposing unauthorized charges on consumers’ accounts and unlawfully requiring consumers to consent to automatic payments from their bank accounts.“We have alleged that Avant gave the run-around to consumers trying to repay their loans, because of systemic issues with the company’s loan servicing platform,” said Andrew Smith Director of the FTC’s Bureau of Consumer Protection. “Online lenders need to understand that loan servicing is just as important to consumers as loan marketing and origination, and we will not hesitate to hold lenders liable for unfair or deceptive servicing practices.”According to the FTC’s complaint, Avant offers unsecured installment loans for consumers through its website. The FTC charged that in many cases, the company falsely advertised that it would accept payments by credit or debit cards, when in fact it rejected these forms of payments. The FTC also alleged that the company withdrew money from consumers’ accounts or charged their credit cards without authorization. In some instances, Avant charged consumers duplicate payments without authorization, improperly taking consumers’ monthly payments twice or more in one month. For example, one consumer’s monthly payment was debited from his account 11 times in a single day.In many cases when consumers complained about the unauthorized charges, Avant allegedly insisted that the consumers authorized the charges and refused to provide a refund. Despite hundreds of consumer complaints about unauthorized charges and internal documents repeatedly acknowledging this problem, the company continued to charge consumers without authorization, according to the FTC.The Commission has also charged the online lending company with the following law violations:failing to properly and timely credit payments made by check;providing inaccurate payoff quotes to consumers;collecting additional amounts even after consumers paid the quoted payoff amount; andviolating the Telemarketing Sales Rule and the Electronic Fund Transfer Act by requiring borrowers to agree to recurring automatic debits of their bank account as a condition of obtaining a loan.The stipulated final order imposes a judgment of $3.85 million, which will be returned to consumers who were harmed by Avant’s unlawful practices.Under the settlement order, Avant, LLC will be prohibited from taking unauthorized payments and from collecting payment by means of remotely created check (RCC). The company also is prohibited from misrepresenting: the methods of payment accepted for monthly payments, partial payments, payoffs, or any other purpose; the amount of payment that will be sufficient to pay off in its entirety the balance of an account; when payments will be applied or credited; or any material fact regarding payments, fees, or charges.The Commission vote approving the settlement order was 5-0. Commissioner Phillips dissented from Count VII of the complaint and issued a separate statement. Commissioner Wilson dissented from Counts VI and VII of the complaint and issued a separate statement. The settlement order was filed with U.S. District Court for the Northern District of Illinois on April 15, 2019.The Federal Trade Commission works to promote competition, and protect and educate consumers. You can learn more about consumer topics and file a consumer complaint online or by calling 1-877-FTC-HELP (382-4357). Like the FTC on Facebook, follow us on Twitter, read our blogs, and subscribe to press releases for the latest FTC news and resources. […]



FTC Protecting America’s Consumers



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