FOR THE CONSUMER
The FTC's monthly newsletter for the Congressional community
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Volume 8- Number 9
IN THIS ISSUE
70 MILLION REFUND. A federal district court has ordered the marketers of two dietary supplements to pay nearly $70 million for deceiving people about the benefits of their products. Donald W. Barrett and his affiliates claimed "Supreme Greens" and "Coral Calcium" would cure cancer, Parkinson’s disease, heart disease, autoimmune diseases and more. Press release: www.ftc.gov/opa/2009/08/dmc.shtm.
CIGARETTE ADVERTISING. According to the FTC’s new report, the five largest cigarette companies in the U.S. spent more then $12 billion on cigarette promotion in 2006 — down from the more than $13 billion spent in 2005. The largest spending category, price discounts, accounted for nearly 74 percent of all marketing expenditures. Press release: www.ftc.gov/opa/2009/08/tobacco.shtm .
HEART-RENDING: The FTC blocked a merger between the only maker of FDA-approved left ventricular assist devices (LVADs) and a company seeking FDA approval for a new LVAD already in clinical trials. LVADs are surgically-implantable miniaturized blood pumps designed to sustain patients awaiting transplants or treat end-stage heart failure. According to the FTC, Thoratec Corporation sought to eliminate HeartWare International, Inc. as the only significant threat to its U.S. monopoly. The companies abandoned their merger plans after the FTC sued. Press release: www.ftc.gov/opa/2009/07/thoratec.shtm.
JOB SCAMS. A federal court — pending a preliminary injunction hearing — has stopped a phony job placement operation that allegedly stole money from job seekers by promising them full-time work and benefits that never materialized. According to the FTC, Career Hotline, Inc., and its principal, Susan Bright, misled job seekers by guaranteeing that they would land positions making at least $25,000 a year if they paid a placement fee and provided work history information. In reality, people that did this did not get the promised jobs or refunds. Press release: www.ftc.gov/opa/2009/08/hotline.shtm.
RAYON. Dyna-E International and its owner, George Wheeler, have settled FTC charges that they misled buyers into thinking that their rayon towels are "biodegradable” — that they would completely decompose within a short time. But their towels are typically disposed of in ways that make that impossible. Press release: www.ftc.gov/opa/2009/08/dyna.shtm.
BAMBOOZLED. The FTC has charged that four clothing and textile sellers lied when they claimed their products are made of bamboo fiber and made in an environmentally-friendly way. In fact, their products are made of rayon, a man-made fiber created by processing plants, including bamboo, with a harsh chemical that releases hazardous air pollutants. The defendants also had no proof that their products retain the natural antimicrobial properties of the bamboo plant and are biodegradable. Sami Designs, LLC, CSE, Inc., and Pure Bamboo, LLC have settled the FTC charges. Litigation continues against The M Group and its principals. Press release: www.ftc.gov/opa/2009/08/bamboo.shtm.
Here’s recent news on the following FTC Rules:
ROBO-CALLS: Amended the Telemarketing Sales Rules to prohibit prerecorded commercial telemarketing calls — commonly known as robocalls — unless the telemarketer has gotten written permission from the people that want to get these calls. The amendment doesn’t outlaw purely “informational” recorded messages — telling people that their flight has been cancelled or that their child’s school opening is delayed. Press release: www.ftc.gov/opa/2009/08/robocalls.shtm.
ELECTRONIC HEALTH INFORMATION: Issued a final rule requiring certain web-based businesses to notify people when the security of their electronic health information is breached. Press release: www.ftc.gov/opa/2009/08/hbn.shtm.
PETROLEUM: Issued a final rule to prohibit fraud, deceit and manipulation of the petroleum markets, including omissions of material information likely to distort those markets. Press release: www.ftc.gov/opa/2009/08/mmr.shtm.
NEGATIVE OPTION: Reopened public comment period until October 13. Prenotification negative option plans — for instance, clubs for members to buy books or CDs — send people periodic notices that merchandise will be delivered unless they decline the items within a set time. Press release: www.ftc.gov/opa/2009/08/nor.shtm.
DEBT COLLECTION. The FTC will host a roundtable discussion September 29-30 in San Francisco to discuss protecting consumers in debt collection litigation and arbitration. The event is free and open to the public; preregistration is not required. A live webcast will be available at www.ftc.gov. For more information, visit www.ftc.gov/bcp/workshops/debtcollectround/index.shtm.
DEBT RELIEF FORUM. The FTC will host a public forum November 4 to discuss recently proposed rules to fight deceptive and abusive telemarketing of debt relief services that supposedly can reduce peoples’ credit card and other unsecured debt. The forum, which is free and open to the public, will be held at 600 Pennsylvania Avenue, NW, Washington, DC 20850. Seating is limited and will be provided on a first come, first served basis. Press release: www.ftc.gov/opa/2009/08/tsrforum.shtm.
FUTURE OF NEWS MEDIA. The FTC will hold workshops on Dec. 1-3 about the future of the news media in the internet age, titled "From Town Criers to Bloggers: How Will Journalism Survive the Internet Age?" Participants, including journalists, representatives of news and new media organizations, privacy experts, direct marketers, online advertisers, academics, and consumer advocates will examine the economics of journalism, possible business and non-profit models for news organizations, the role of targeted behavioral and other online advertising, and whether any governmental actions might be advisable, such as changes in the tax code, or additional copyright protection or limited antitrust exemptions. Press release: www.ftc.gov/opa/2009/08/news2009.shtm.
LAYAWAY: ANOTHER WAY TO BUY. Explains how layaway purchase plans work and offers questions to ask retailers. 8.5”x11”, 2 pages. www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt173.shtm.
HAVE YOU BEEN BAMBOOZLED BY BAMBOO FABRICS? Lets environmentally conscious shoppers know that the soft “bamboo” fabrics on the market today are really rayon, which is made using toxic chemicals in a process that releases pollutants into the air. 8.5”x11", 1 page. www.ftc.gov/bcp/edu/pubs/consumer/alerts/alt160.shtm.
As the hurricane season gets underway, it’s time to tap into your inner scout and "be prepared." Your preparation for weather extremes or other natural disasters of course involves securing your windows, roof, or basement, but it also requires you to organize your financial papers. The FTC has useful information on where to start, and how to minimize disruption once a storm has passed. The one-stop site — www.ftc.gov/hurricanerecovery — has practical guidance on how to weather a storm and its related surges, high winds, tornadoes, and flooding, as well as how to get your financial and insurance documents ready.
Being prepared also means knowing what to watch out for after a disaster. Get tips on avoiding the home repair rip-offs, bogus charities, and other scams that inevitably follow in a hurricane’s wake, as well as links to other organizations with important information. Visit www.ftc.gov/hurricanerecovery.
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