Court Order Bars Defendants From All Future Marketing and Sales Misrepresentations
A Nevada corporation and its principal whose advertisements and telemarketers promised consumers that they could make big bucks through a work-at-home medical billing opportunity have agreed to settle Federal Trade Commission charges that their misleading pitches violated the law. According to the FTC, after paying hundreds of dollars for the defendants’ information packages, nearly 5,000 consumers found that the list of doctors that the defendants provided them was inaccurate or that the doctors did not want or need at-home billing help. The stipulated final order announced today permanently bans International Trader and its president, director, and owner Bruce Anugwom from promoting or selling work-at-home opportunities and, on a larger scale, from misrepresenting any material fact related to any product or service they are offering for sale in the future.
"Most consumers targeted in this scheme came from small towns across the United States," said J. Howard Beales III, Director of the FTC’s Bureau of Consumer Protection. "But no matter where they live, people who want to work at home should be wary when considering a program – medical billing or otherwise – that seems to promise a lot of money for a little effort."
The Commission’s Complaint
According to the FTC’s complaint, filed as part of the joint federal/state "Operation Dialing for Deception" law enforcement sweep, the defendants marketed work-at-home medical billing opportunities to consumers through classified ads and a deceptive telemarketing pitch. They promised that for a fee ranging from $189 to $339, they would provide everything necessary to conduct a medical billing business from home, including a list of doctors who needed help from in-home billers, as well as the software to perform the work. The defendants allegedly claimed consumers could make between $15 and $45 per hour through their business. After paying the fee, however, consumers found that the doctors on the lists the defendants provided either were impossible to reach or did not need medical billers. Consumers were not able to earn the hourly wage promised by the defendants’ ads and telemarketers. Such misrepresentations are a violation of Section 5 of the FTC Act.
Terms of the Stipulated Order
The stipulated final order bans International Trader and Anugwom from promoting or selling any work-at-home opportunity or helping others to do so. The term "work-at-home opportunity" is defined as "any program, plan, product, or service represented to enable or assist a participant or purchaser to earn money while working at home."
In addition, the order prohibits misrepresentations similar to those alleged by the Commission, and more broadly, prohibits the defendants from misrepresenting "any material fact regarding any item, product, good, or service sold or offered for sale." The order prohibits the defendants from selling their customer lists or from collecting any payments for their work-at-home medical billing opportunity. The order also requires the defendants to turn over certain assets for liquidation.
The Commission vote to accept the proposed settlement was 5-0. The settlement was filed in the U.S. District Court for the Central District of California, Western Division, on September 13, 2002, and is pending court approval.
Copies of the complaint and proposed stipulated final judgment and order for permanent injunction are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint, or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.
(FTC File No. X020045)
(Civ. No. CV-02-02701 AHM (JTLx))
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FTC Midwest Region, Chicago