Today kicks off National Consumer Protection Week, but what the FTC does to protect consumers is only part of the story. We also work hard to help small business get down to business. Here are just a few examples of what we’re doing to protect your business from deceptive practices.
Blog Posts Tagged with Advertising and Marketing Basics
Congress unanimously passed the Consumer Review Fairness Act to protect people’s ability to share in any forum their honest opinions about a business’ products, services, or conduct. Some companies had been using contract provisions – including their online terms and conditions – to threaten to sue consumers or penalize them financially for posting negative reviews or complaints. The new law makes that illegal.
An ongoing FTC case is a reminder to businesses — If you make product claims based on scientific testing, you must have valid proof to back up those claims.
Case in point: Last fall, the FTC filed a lawsuit against Innovative Designs, Inc. (IDI) over allegations that the company violated the FTC Act by making false and unsubstantiated claims about its house wrap products.
In promotional materials to attract prospective drivers, ride-hailing company Uber Technologies touted how much money drivers would earn and the favorable terms they could get by financing a car through Uber’s Vehicle Solutions Program. But according to an FTC complaint, Uber exaggerated those earnings claims and misrepresented the terms of its Vehicle Solutions Program.
When thinking about buying a used car, some people hit a speed bump when they get to the “used” part. It’s one thing to spot a dinged fender or smudged floor mat, but it’s tougher to evaluate a used car’s essential systems. In separate complaints, the FTC charged that CarMax and two large dealership groups touted how rigorously they inspect their used cars and yet failed to clearly disclose to prospective buyers that some were subject to unrepaired safety recalls.
Promoting a “Young People’s Revolution,” multi-level marketer Vemma pitched its business opportunity to college students and other young adults as a big-money, fast-lane alternative to “the traditional 9-to-5.” In 2015, the FTC sued Vemma and related parties, alleging that its smoke-and-mirrors earnings claims were obscuring the true nature of what Vemma was up to. As a result of an FTC settlement, there’s a revolution underway all right.
Claims about employment prospects and income levels are like any other objective advertising representation – and Job #1 for advertisers is to support those promises with solid evidence. DeVry University and its parent company have entered into a $100 million settlement to resolve the FTC’s allegations that the defendants’ claims didn’t make the grade.
The military community makes many of the same consumer decisions as their civilian counterparts. We all need to manage our money – and avoid rip-offs. But servicemembers and their families also face unique challenges, like frequent relocations and deployment. When a permanent change of station is on the horizon, a military family needs to rent or buy a new place to live, manage money while on the move, and be vigilant about dealing with businesses in an unfamiliar locale. A servicemember’s regular paycheck from Uncle Sam can make them a target for scammers.
From the perspective of consumers, the whole purpose of prepaid debit cards – their reason for living, if you will – is to give consumers immediate access to their money. Those cards are an especially important financial lifeline for people who don’t have traditional bank accounts.
A participant on a reality dating show who doesn’t tell the truth? So what’s new. A participant on a reality dating show who is a defendant in an FTC action and doesn’t tell the truth in a sworn financial statement? That’s a different story.
Here are some truths about Grants.
Ulysses was the 18th president.
Cary was a suave star of the silver screen.
Former NBA great Horace wore the coolest goggles in the game.
With only two weeks until Halloween, people are starting to think about their costumes. A pirate, a witch, a Jedi knight – or an enforcement official from the U.S. Department of Transportation? According to an FTC lawsuit, that’s the disguise a Florida-based operation used to take in more than $19 million from small businesses.
It’s a digital spin on an old-school business: an online service that offers to pay “top dollar” for consumers’ used smartphones, laptops, or tablets. The technology may be trending, but according to the FTC and the State of Georgia, Nevada-based Laptop & Desktop Repair engaged in a classic 20th century bait-and-switch – and bilked consumers out of millions in the process.
It’s a term you see on labels and in advertising, but what does it mean to consumers? The word is “organic,” and consumer interpretations of organic claims for non-agricultural products is the topic on the agenda at an October 20, 2016, roundtable sponsored by the FTC and the U.S. Department of Agriculture.
Not many kids play with yo-yos these days, but an FTC complaint against nine related Los Angeles-area car dealers charges that the companies engaged in (among other things) illegal yo-yo financing practices – and for affected consumers, it was no game. Even if you don’t have clients in the auto industry, this case merits your attention.
There’s no such thing as a free lunch. That’s what consumers who signed up for NutraClick’s “free” samples learned. But what can your business take away from the FTC’s settlement with NutraClick? If your company is considering offering a negative option program, and wants it to be a positive experience, you’ll want to read on.
There’s an upcoming gotta-be-there trade show for your industry. Your company gets a form in the mail from a P.O. box in the Chicago area asking to confirm your address for a trade show listing. You or a staffer signs without giving it a second thought – until you get the surprise of a lifetime.
Well, that didn’t take long.
The details of the historic $10 billion Volkswagen “clean diesel” settlement are still being finalized – and as we mentioned a few weeks ago, we’re already hearing reports of dealers targeting VW owners and lessees with promotions that include half-truths, misinformation, and downright deception.
If a disclosure is intended to inform consumers – and isn’t that pretty much the job description of a disclosure? – it should accomplish that task effectively. A “disclosure” that fails that fundamental test is no disclosure at all. That’s FTC 101. So what can be done to improve the testing and evaluation of disclosures? Leading academics and testing professionals will gather at the FTC on September 15, 2016, to explore that topic.