FTC Adds Charges Against Auto Marketer For Deceptive “Prize” Mailers

The Federal Trade Commission has issued an administrative complaint against a marketer, Traffic Jam Events, LLC, and its owner, David J. Jeansonne II, charging multiple counts of deceptive conduct. The administrative complaint mirrors a prior federal court complaint, which the Commission voluntarily dismissed to pursue a broader administrative proceeding.

The administrative complaint alleges that the respondents have deceived consumers with mailers supposedly directing them to obtain federal COVID-19 stimulus benefits. The complaint also alleges that, in addition to the misleading COVID-19 mailers, respondents sent flyers to consumers containing matching numbers indicating that consumers had won a valuable prize. Consumers were then told they had to go to a car dealership to “claim” the prize, but the small print on the back of the mailer revealed that there was only a 1-in-52,000 chance the consumer had actually won the prize specified.

In addition to FTC Act violations alleged related to the COVID-19 and prize mailers, the FTC’s complaint claims the respondents violated the Truth In Lending Act and Regulation Z for failing to clearly disclose required credit information in their advertising.

The Commission vote to issue the administrative complaint and dismiss the federal proceeding was 4-0-1, with Commissioner Rebecca Kelly Slaughter recorded as not participating.

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. The issuance of the administrative complaint marks the beginning of a proceeding in which the allegations will be tried in a formal hearing before an administrative law judge.