Most people are familiar with the Publishers Clearing House Prize Patrol and their visits to consumers’ homes to deliver those big checks. In a twist on the familiar scenario, this time the FTC is – metaphorically speaking – paying a call on Publishers Clearing House as the Apprise Patrol, apprising companies and consumers of a proposed settlement with Publishers Clearing House for multiple violations of federal law. However, a big check is still involved: an $18.5 million financial remedy for the company’s use of allegedly deceptive tactics in how it promoted its sweepstakes.
Any discussion of Publishers Clearing House’s sweepstakes practices has to start with a mention of the company’s long history of alleged consumer protection violations. The FTC complaint cites multimillion dollar settlements with State AGs in 1994, 2000, 2001, and 2010. Then there was a $10 million settlement of a nationwide class-action lawsuit. Congress looked into potentially deceptive practices by PCH and other sweepstakes companies in 1998 and 2013, and also passed the Deceptive Mail Prevention and Enforcement Act. That law requires that sweepstakes mailers clearly and conspicuously disclose “on the order or entry form, that no purchase is necessary to enter [the] sweepstakes,” and that “a purchase will not improve an individual’s chances of winning.”
In the intervening years, PCH has moved a substantial portion of its marketing efforts online, where the FTC says PCH has employed digital dark patterns to deceive people. According to the complaint, the company used “the prospect of winning lucrative sweepstakes prizes to lure consumers” – often older people with lower household incomes – “into repeatedly visiting its e‑commerce website and buying products.” The FTC says PCH misled them “into believing that they must place an order to buy products to enter a sweepstakes or that ordering will increase their odds of winning.”
You’ll want to read the complaint for a detailed analysis of how the FTC alleges PCH used deception to lure people in, but here’s a summary of the tortuous journey consumers had to take just to enter a sweepstakes. When consumers first visited PCH’s webpage, they were presented with an “Official Entry Form” or “Official Entry Registration Form” to “WIN $5,000 a week ‘FOREVER.’” After typing in their personal information, PCH presented them with a button that says “Submit Entry!” – or in other examples, “WIN IT!” or “Win for Life!”
So at that point did PCH enter them in the advertised sweepstakes? No. As the complaint puts it, “PCH does not process consumers’ sweepstakes entries when consumers complete and submit the ‘Official Entry Form.’” Instead, the company took them through page after page of sales pitches. Only after navigating through that marketing material did PCH present them with another button that the FTC says led people to think they were finally entered in the sweepstakes.
But it didn’t stop there. Once in possession of their email addresses, PCH then sent consumers emails claiming they had to take a “final step” to claim a prize number on the “winner selection list” or be eligible to win the sweepstakes. In some instances, PCH told people if they didn’t respond, they would be “disqualified.”
So by clicking links in those emails did PCH enter them in the advertised sweepstakes? Again, no. Instead the FTC says PCH sent them back to its e-commerce site where once again people had to navigate through a deceptive loop of pitches and prompts, including a confusingly titled “Official Order-Entry Form.” According to the FTC, that’s one more tactic PCH used to further its deceptive conflation of the sweepstakes entry process and the product ordering process.
For example, the complaint charges that if consumers got to that page without putting anything in their shopping cart, PCH often displayed a message directing them back to the shopping pages. In other cases, if consumers clicked the “Enter Now” button, the FTC says the company presented them with more confusing product offers. Throughout the process, if consumers still tried to enter the sweepstakes without buying anything, PCH continued to send them confusing emails referring to “1 critical decision” or “the last step” that consumers needed to take. When consumers would click on those emails, the company made references to the fact that “We see you’ve never placed an order” and that “Just one order is all it takes to activate these customer rewards.” One screen with the bold headline “PLEASE DON’T SAY NO!” presented people with an array of merchandise to buy – including a “Kissing Moose Salt and Pepper Shaker Set.” The FTC says that people who didn’t opt for those items had to make their way through more relentless product offers in what would have to be described as a “Groundhog Day” of circular sales pitches.
But what about the legal requirement that people can enter the sweepstakes without buying anything? As the complaint alleges, PCH did state “No purchase or fee necessary to enter. A purchase won’t increase an individual’s chance of winning.” But it was in fine print. And on the shopping pages, the disclosure appeared at the bottom and below the CONTINUE button – hardly a clear and conspicuous disclosure.
The complaint alleges that PCH made a host of deceptive representations to consumers, including that a purchase was necessary to enter the sweepstakes, that buying something would increase their chances of winning, that they had been entered in the sweepstakes when they hadn’t, and that they would be “disqualified” if they didn’t take additional steps. The FTC also charges that for people who did order merchandise, PCH didn’t disclose the total cost of their order and made deceptive “risk-free” guarantees. Furthermore, the complaint alleges that until January 2019, PCH falsely claimed it didn’t “rent, license, or sell personal data to third parties” when it shared that information with third parties that advertised on PCH’s websites and other platforms. In addition, the FTC says PCH violated the CAN-SPAM Rule by sending marketing emails with deceptive subject lines – for example, one titled “High Priority Doc. W-34 Issued,” leading consumers to believe the message was related to a tax form or some other official requirement.
In addition to the $18.5 million financial remedy, the proposed order, which is subject to court approval, requires PCH to make clear disclosures that consumers don’t have to buy anything to enter a sweepstakes and that a purchase won’t increase their chances of winning. The order also prohibits the company from using tactics that state or imply the contrary. What’s more, PCH will have to take steps to separate sweepstakes from sales on its website.
The proposed order bans a host of deceptive dark patterns, including false exhortations of urgency. Also prohibited: misrepresentations about the total cost of goods, deceptive statements about how the company uses consumers’ personal information, and violations of the CAN-SPAM Act.
The proposed settlement offers insights for companies that use sweepstakes and similar promotions, but even if your company doesn’t, the action conveys important advice for all businesses.
Dark patterns take many injurious forms and the FTC is committed to rooting out all of them. The phrase “dark patterns” covers broad categories of deceptive feints, head fakes, and misdirections that have violated the FTC Act for years. As this action illustrates, digital dark patterns can be particularly harmful to consumers. Companies that want to stay out of legal hot water should strive for transparency in their transactions. Luring people in under false pretenses and then subjecting them to a relentless barrage of sales pitches until they finally cry “Uncle!” is an unacceptable business practice.
Consider a CAN-SPAM compliance check at your company. If it’s been a while since you’ve taken a close look at your marketing emails, read the FTC’s CAN-SPAM Act: A Compliance Guide for Business. Make sure your messages still measure up.
The purpose of this blog and its comments section is to inform readers about Federal Trade Commission activity, and share information to help them avoid, report, and recover from fraud, scams, and bad business practices. Your thoughts, ideas, and concerns are welcome, and we encourage comments. But keep in mind, this is a moderated blog. We review all comments before they are posted, and we won’t post comments that don’t comply with our commenting policy. We expect commenters to treat each other and the blog writers with respect.
- We won’t post off-topic comments, repeated identical comments, or comments that include sales pitches or promotions.
- We won’t post comments that include vulgar messages, personal attacks by name, or offensive terms that target specific people or groups.
- We won’t post threats, defamatory statements, or suggestions or encouragement of illegal activity.
- We won’t post comments that include personal information, like Social Security numbers, account numbers, home addresses, and email addresses. To file a detailed report about a scam, go to ReportFraud.ftc.gov.
We don't edit comments to remove objectionable content, so please ensure that your comment contains none of the above. The comments posted on this blog become part of the public domain. To protect your privacy and the privacy of other people, please do not include personal information. Opinions in comments that appear in this blog belong to the individuals who expressed them. They do not belong to or represent views of the Federal Trade Commission.
Received letter I won , I didn’t get prize.
In reply to Received letter I won , I… by IBUKUN
That is from a scammer please don't respond to them.
Everything written above is true I’ve been saying this for years and years
In reply to Everything written above is… by Gwendolyn Crawford
So what does this mean for people can we still win ? Or what I am like many and really can use that winnings
In reply to So what does this mean for… by Jacob
I’m in need of house repairs, it would a blessing if I receive money from a law suit , and I’m not talking five years fro now !!!
In reply to So what does this mean for… by Jacob
Do the winners have to pay a Activation fee for there prize
I happen to be one of those people who have played Publisher's Clearinghouse for over 32 years, and I agree with you totally that that's how PCH does business.
I've ordered from them like two years ago and I've been playing and until this day I still did so sad to keep constomers hope so high
Where's the compensation for the dozens of PCH's GUARANTEED "5K, 7K, 10K A Week For Life" sweepstakes that has NEVER been awarded?
Could you please hold PCH accountable for what was to be a check of ten+ million awarded to multiple winners throughout the years, which has never happened?
In reply to Where's the compensation for… by B. Blazjowski
I agree they had me believing I won and waited all day for them to show up had friends there and nothing I feel they lied and cheated me I was completely devastated
They have never given me the discounts when I send in the coupans with order but have always charged me full price anyway with no discount even though I sent in the coupon earned.
You make people buy in order to think they are getting a bargain and win.
Please take me off the list I am tired to hear "this Loyalty recognition" RIDICULE
lLILIANE NINO 27 YEARS!... OFF YOUR LIST YOU WILL DO ME A FAVOR!
This is, VERY helpful with, the information provided. I am glad that, I went to this site. A lot of time reading but, WORTH EVERY MINUTE !! THANK YOU !!!
I have also been entering 30+ years. My problem is I don't order anything but they said I did. I pay it but next time it WILL GO BACK!! FRUSTRATING AND LIKE OTHERS NEVER HAVE ONE A PENNY.
Ive noticed they use the same names in "new winner" like Jinhee W. or Deborah S.