FOR THE CONSUMER
The FTC's monthly newsletter for the Congressional community
It's the news you - and your constituents - can use.

Volume 9 - Number 3
March 2010

IN THIS ISSUE

NEWS FLASH

FREE CREDIT REPORT. Starting April 1, advertising for “free credit reports” will require new disclosures to help people avoid those allegedly “free” offers for credit reports available at AnnualCreditReport.com, or 877-322-8228. The “free” offers often require people to spend money on credit monitoring or other products or services. The Credit CARD Act of 2009 required the Commission to issue a rule to prevent deceptive marketing of “free credit reports.” Read the press release.

P2P. The FTC has notified almost 100 organizations that sensitive data about their customers and/or employees is available on peer-to-peer (P2P) file-sharing networks to any users of those networks, who could, in turn, use the personal information to commit identity theft or fraud. The agency also has opened non-public investigations of other companies whose customer or employee information has been exposed on P2P networks. Check out the FTC’s information for businesses and consumers that recommend ways to manage the risks of using P2P networks. Read the press release.

TOP COMPLAINTS. The FTC has issued the top complaints filed with the agency in 2009. It shows that while identity theft remains the top complaint category, identity theft complaints decreased 5 percent from 2008. The report breaks out complaint data on a state-by-state basis and includes data on the 50 metropolitan areas reporting the highest per capita incidence of fraud and other complaints. The agency also released a new video showing how to file a complaint, and offers examples of what complaints the FTC handles. Read the press release.

BAIT-AND-SWITCH. The FTC has settled charges that Ticketmaster and its affiliates used deceptive bait-and-switch tactics to sell event tickets to concertgoers. Ticketmaster has agreed to pay refunds to people who bought tickets for 14 Bruce Springsteen concerts in 2009 through TicketNow, its ticket resale site, and to be clear about the costs and risks of buying through its reseller sites. The FTC charged that Ticketmaster steered consumers to TicketsNow, where tickets were offered at much higher prices – in some cases quadruple the face value. According to the FTC, Ticketmaster also didn’t tell buyers that many of the resale tickets advertised on TicketsNow.com were not actual tickets secured for sale at the time they were listed and bought. Ticketmaster kept the sales proceeds for more than three months without a reasonable basis for believing it could fulfill the orders. Read the press release.

BOTTOM DOLLAR. The FTC continues its crackdown on con artists who prey on unemployed Americans by promising to help them get jobs in the federal government, as movie extras, or as mystery shoppers; or make money working from their homes stuffing envelopes or assembling crafts and ornaments. David Vladeck, Director of the FTC’s Bureau of Consumer Protection, Tony West, Assistant Attorney General for the Civil Division of the Department of Justice, and Ohio Attorney General Richard Cordray announced the law enforcement sweep “Operation Bottom Dollar,” against these scams. The sweep includes seven FTC cases, 43 criminal actions by the Department of Justice, a civil action by the Postal Inspection Service and 18 actions by state attorneys general. The FTC also partnered with Monster.com, the search engine Bing, and Craigslist to post FTC tips that help job seekers recognize and avoid job scams. Read the press release.

SUPPLEMENTS. The FTC has sent letters to 11 companies that promote various Omega-3 fatty acid supplements, telling them they should review their product packaging and labeling to make sure they don’t violate federal law by making baseless claims about how the supplements benefit children’s brain and vision function and development. Product packaging and advertising might be in violation of the FTC Act unless there is scientific evidence to support claims that the products boost, improve, enhance, or support brain and vision function and development in children. The companies have two weeks to respond and explain how they will ensure compliance with the law. Read the press release.

NATIONAL CHECK CONTROL. The FTC will distribute $1.6 million to thousands of people who were scammed into paying money they didn’t owe by con artists who threatened, harassed and lied to them. In 2003, the FTC sued three companies, operating under the name National Check Control; in 2005, the court stopped their operations and ordered them to pay redress to the people they’d bilked. The redress funds will go to nearly 25,000 people who lost $100 or more each. Read the press release.

DR. FIX-IT. A group of Colorado physicians settled FTC price fixing charges by agreeing to stop setting reimbursement rates or using anticompetitive negotiating tactics against health insurers. The FTC claimed that Roaring Fork Valley Physicians, which represents about 80 percent of the doctors in Garfield County, Colorado, set higher prices for medical services and encouraged members to refuse to deal with insurers that did not meet its demands for higher rates. Read the press release.

TESTIMONY

Before the Senate Committee on Commerce, Science and Transportation

FTC Chairman Jon Leibowitz testified that the FTC has stepped up efforts to protect people affected by the economic downtown, and that additional authority would make the agency even more effective. During the past five years the FTC has targeted financial services providers in more than 100 actions and, in the past decade, obtained nearly half a billion dollars in redress for consumers. The agency encourages Congress to give it: explicit authority to act against those who assist others they know, or consciously avoid knowing, are engaged in unfair or deceptive practices under the FTC Act; more efficient rulemaking procedures; authority to get civil penalties for violations of the FTC Act; and to prosecute civil penalty cases in federal court in its own name to bring cases more quickly and more effectively. Read the testimony.

PROPOSAL

The FTC moved to protect distressed homeowners from the promoters of bogus foreclosure rescue and mortgage modification services by proposing a new rule that would forbid companies to charge in advance for these services. Instead, companies could collect payment only after providing services. The FTC notice seeks public input on the proposal. Read the proposal.

NEW AND REVISED MATERIALS FOR CONSUMERS

NEW VIDEOS
Grab these videos for your website or blog.

PUBLICATIONS

  • FEDERAL AND POSTAL JOB SCAMS: TIPS-OFFS TO RIP-OFFS. Highlights that job seekers never have to pay for information about vacancies with the federal government or U.S. Postal Service, and that it’s free to apply for federal and postal jobs. Offers tips to help you avoid federal and postal job rip-offs. 8.5"x11", 2 pages.
  • WORK-AT-HOME SCHEMES. Offers people interested in work-at-home opportunities (including medical billing, envelope stuffing, and craft or assembly work) questions to ask before spending their money on these offers. 8.5"x11", 4 pages.
  • TAKE THIS SCHEME AND STUFF IT: AVOIDING ENVELOPE-STUFFING RIP-OFFS. Warns prospective workers that promises of big earnings stuffing envelopes from home are false and a sign of a rip-off. 8.5"x11", 2 pages.

COMING EVENTS

JOURNALISM. The FTC will host its second workshop on the future of journalism March 9-10. This workshop is free and open to the public; it will be held in Room 432 of the FTC Headquarters at 600 Pennsylvania Avenue, N.W. Read the press release and agenda.

PRIVACY. The FTC is hosting its final public roundtable to explore the privacy challenges posed by social networking, cloud computing, online behavioral advertising, mobile marketing, and the collection and use of information by retailers, data brokers, third-party applications, and other businesses. This roundtable will address such issues as how best to protect health data and other sensitive consumer information, and identity management and accountability approaches to privacy. It also will look back at some of the themes raised throughout the series of discussions. This event is free and open to the public; no pre-registration required. It will be held March 17 at the FTC’s Conference Center, 600 New Jersey Ave, NW, Washington, DC. A live webcast will be available at www.ftc.gov. For more information, visit the workshop page.

TIP OF THE MONTH – JOB SCAMS

You may have heard complaints from unemployed constituents in the midst of a job search. They may have seen ads for firms that promise results. Many of these firms may be legitimate and helpful, but others may misrepresent their services, promote out-dated or fictitious job offerings, or charge high fees in advance for services they guarantee will lead to a job. Here are some tips for them from the FTC:

  • Reject any company that promises to get you a job. Be skeptical of any employment-service firm that charges first, even if it guarantees refunds.
  • Get a copy of the firm’s contract and read it carefully before you pay any money. Understand the terms and conditions of the firm’s refund policy. Make sure you understand what services the firm will provide and what you’ll be responsible for doing. If oral promises are made, but don’t appear in the contract, think twice about doing business with the firm.
  • Take your time reading the contract. Stay away from high-pressure sales pitches that require you to pay now or risk losing out on an opportunity. Be cautious about buying services or products from a firm that’s reluctant to answer your questions.
  • Be aware that some listing services and “consultants” write their ads to sound like they have jobs available when they’re really selling general information about getting a job.

Cut and paste these tips or the FTC’s other free content into your district newsletter, link to it on your Member’s website or hand out publications in town hall meetings. Share the FTC’s new video about avoiding job scams with your network. Learn more at ftc.gov/jobscams.

NUMBERS TO KNOW

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