FTC Charges North Carolina Defendants with Attempting to Exploit Promise of Do Not Call Registry

Consumers Conned Into Paying for Do Not Call Listing

For Release

 

The Federal Trade Commission today announced a complaint against a set of North Carolina-based defendants who allegedly billed consumers, without their consent, for listing them in the National Do Not Call Registry for telemarketing – before it had even been set up.

According to the FTC’s complaint, the defendants cold-called consumers offering to list them in the Federal Communications Commission’s (FCC) do not call list. At the time the calls were made, however, the FCC did not have a do not call list in place, and the defendants had no way of listing consumers, who were charged as much as $99.95 for their first year of “service.”

“These defendants billed consumers who refused their pitch, and they didn’t deliver anything to anyone,” said Howard Beales, Director of the FTC’s Bureau of Consumer Protection. “There is absolutely no need for any consumer to pay to place a phone number on the National Do Not Call Registry. It’s a free service of the federal government, and it’s easy to do by telephone or online.” Beales said that consumers can add a number to the registry at www.donotcall.gov or by calling 1-888-382-1222 (TTY 1-866-290-4236), and there is no deadline for signing up.


The FTC’s Complaint

The Commission’s complaint, announced today, charges Telephone Protection Agency and Robert Thompson, Rebecca Phillips, and Alex McKaughn with violating both the FTC Act and the Telemarketing Sales Rule (TSR). The complaint was filed in the U.S. District Court in North Carolina.

According to the Commission’s complaint, starting in November 2001, the defendants cold-called consumers and promoted a service that supposedly would stop unwanted telemarketing calls and protect the consumer’s personal financial information. In many instances, the defendants billed consumers’ credit cards or debited their bank accounts even though the consumers never agreed to buy the service.

Additionally, some consumers received a package of written materials from the defendants that contained a number of misrepresentations. For example, the defendants represented that they would register customers with “the FCC’s National NO CALL List” and “provide a monthly list to companies nationwide” of their customers’ “demand for privacy.” Both claims were false, the FTC alleges, as the FCC did not have a do not call list in place at the time, and the defendants did not provide a monthly list to companies nationwide to protect consumers’ privacy.

Based on their alleged unauthorized billing and misrepresentations to consumers, the complaint charges the defendants with violating the FTC Act and the TSR. In filing its complaint with the court, the FTC is seeking injunctive and other necessary relief to remedy the alleged violations.

The Commission vote authorizing the staff to issue the complaint was 5-0. The complaint was filed in the U.S. District Court for the Western District of North Carolina on April 21, 2004.

NOTE: The Commission issues or 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 complaint is not a finding or ruling that the named parties have violated the law. The case will be decided by the court.

Copies of the Commission’s complaint 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, DC 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. 032-3119, Civ. No. 5:04cv49)

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