ICFE
ICFE eNEWS #15-22 - June 29th 2015
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Penn Corner June 2015 - Update from the Federal Trade Commission

Fake Cancer Charities Duped Donors

The FTC and law enforcement partners from all 50 states and the District of Columbia charged four sham cancer charities with taking over $187 million from donors and spending much of it on the people who ran the fake charities, and their telemarketers. The money went for cars, vacations, cruises, college tuition, gym memberships, jet ski outings, sporting event and concert tickets, and dating site memberships, among other things. According to the complaint, Cancer Fund of America, Inc.; Cancer Support Services Inc.; Children's Cancer Fund of America Inc.; and The Breast Cancer Society told donors their money would help support cancer patients with medicine, groceries, transportation for chemo treatments, counseling, and hospice care, but little or none went for those purposes.

Ashworth College Learns a Lesson

Ashworth College agreed to settle FTC charges that it misrepresented what its online college degree and career-training programs could do for students. Ashworth promised that graduates of its programs would have the "credentials [to] apply for jobs [or] change careers." However, many of its programs did not meet the standards of state licensing bodies. The FTC also alleges the for-profit college falsely claimed that the course credits students earned there could transfer to other colleges. The FTC says Ashworth had no basis for that promise - and even lacked the type of accreditation that many schools require to accept transfer credits.

Debt Collectors Messaging for Money

The FTC took action against three debt collection companies, alleging that when they texted, emailed or called financially distressed people, they didn't say they were debt collectors. According to the complaint, Unified Global Group, Premier Debt Acquisitions, and Primary Group deceived people by pretending to be attorneys or government agencies and threatening lawsuits or arrests.

Flushable Wipes Clogged Pipes

The FTC filed a complaint against Nice-Pak Products, alleging the company lacked proof for claims that its wipes were safe for sewer and septic systems. According to the FTC, Nice-Pak deceived people by claiming in ads that the wipes would break down after flushing. Nice-Pak also claimed the wipes were safe for household and public systems. The FTC says Nice-Pak didn't test the wipes under real-world conditions. According to the settlement, the company can't say the wipes are safe to flush unless it has new tests proving that they are.

Sweepstakes Scam Stopped

The FTC issued a complaint against Mail Tree, Inc. and ten other companies for taking more than $25 million from older people with a sweepstakes scam. According to the FTC, people got official-looking prize notifications in the mail with seals, stamps, and identification numbers that said they had won $2 million dollars or more. The FTC alleges the companies tricked people into sending $20-$30 dollars each to claim their promised millions.

Sleep-Disorder Drug Stays Competitive

Cephalon, Inc. agreed to pay $1.2 billion to settle FTC charges that it illegally blocked generic competition to its blockbuster sleep-disorder drug Provigil. According to FTC Chairwoman Edith Ramirez, the "landmark settlement is an important step in the FTC's ongoing effort to protect consumers from anticompetitive pay for delay settlements, which burden patients, American businesses, and taxpayers with billions of dollars in higher prescription drug costs." The settlement ensures that Teva Pharmaceutical Industries, Ltd., which acquired Cephalon in 2012, will compensate purchasers, including drug wholesalers, pharmacies, and insurers, who overpaid because of Cephalon's illegal conduct.

New Notario Scams Fotonovela

The FTC has a new Spanish-language fotonovela called Como se enteraron Myriam y Pedro de las estafas de notario, or How Myriam and Pedro Found Out About Notario Scams. The fotonovela tells readers in the Latino community about the warning signs of this immigration-related scam. It also explains where to find help with the immigration process, and how to report scams to the FTC. Visit FTC.gov/bulkorder to order free copies.

"Cancer is a debilitating disease that impacts millions of Americans and their families every year. The defendants' egregious scheme effectively deprived legitimate cancer charities and cancer patients of much-needed funds and support. The defendants took in millions of dollars in donations meant to help cancer patients, but spent it on themselves and their fundraisers. I'm pleased that the FTC and our state partners are acting to end this appalling scheme." -- Jessica Rich, Director of the FTC's Bureau of Consumer Protection

Deceptive Crowdfunding Crackdown

The FTC settled its first crowdfunding case. According to the FTC complaint, Erik Chevalier, using the name "The Forking Path Co.," made deceptive promises to people that he would use crowdfunding money to create a board game called "The Doom That Came to Atlantic City." The FTC alleges Chevalier also promised people rewards for contributing - like an early version of the game or game figurines. The FTC says The Forking Path Co. never made the board game, sent rewards, or gave money back to people.

Nopalea Refunds

The FTC mailed 500,000 refund checks totaling almost $3 million to people who lost money buying Nopalea, a cactus-based fruit drink marketed to treat health problems. According to the FTC, Trivita, Inc. claimed Nopalea was scientifically proven to relieve pain, among other things. The FTC alleges that the company lacked the science to back up its claims about the juice's health benefits.

Bogus Telemarketing Pitch

According to the FTC, Universal Processing Services of Wisconsin, LLC, and HES Merchant Services Company, Inc. agreed to settle deceptive telemarketing charges. The FTC alleges the companies used illegal robocalls to solicit thousands of people about a credit card interest rate reduction service. The FTC says the companies lied about being able to help people out of credit card debt. The companies also called numbers that were registered on the FTC's Do Not Call Registry.

IN OTHER NEWS:

FTC Requests Bankruptcy Court Take Steps to Protect RadioShack Consumers' Personal Information
FTC Returns Money to Consumers in Phantom Debt Collection Scam
FTC Approves Final Consent Orders in Two Deceptive Auto Advertising Cases
FTC Returns Money to Consumers in Mortgage Relief Scam

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Looking to fix your home? The FTC has tips on finding a reputable contractor, and avoiding home improvement scams. http://go.usa.gov/3E4NC
Are you a federal employee whose personal information may have been exposed? Protect your identity with these steps: http://go.usa.gov/3P5BV
Paying through an app? Make your account less vulnerable to fraud. Check the app's settings for security features. http://go.usa.gov/3P59Q
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Sent by:

Paul S. Richard
President - Executive Director
Institute of Consumer Financial Education (ICFE)


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