CONSUMER NEWS RECALLS COMPLAINT FORM SCAM ALERTS
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CONSUMER NEWS RECALLS COMPLAINT FORM SCAM ALERTS |
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FTC Winds Up Nationwide Crackdown
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April 12, 2000
The FTC had filed a suit against CWP and Keilty as well as AMP Publications, Inc., and its owner Ranjit Narayan, as part of a nationwide crackdown on fraudulent business opportunities. The FTC alleged that the defendants advertised large potential incomes for work-at-home computer users, but few, if any, consumers who purchased their program were able to make such earnings. Under the terms of the settlement, CWP and Keilty are barred from marketing or selling any work-at-home business opportunity for seven years and are prohibited from making false and misleading statements when engaging in the promotion or sale of any product or service. (In February 2001, the court entered a $4.9 million default judgment against AMP and Narayan and permanently banned them from engaging in the sale of work-at-home business opportunities.) The settlement ends the litigation in this case, which was among 35 cases brought by the FTC and the Department of Justice as part of the crackdown. The defendants in this case, and most of the others, advertised in the classified section of daily newspapers to peddle work-at-home scams. According to the FTC's court papers, the defendants placed classified ads on the Internet, in national magazines and in small-town newspapers. The ads contained statements such as: "COMPUTER USERS NEEDED Consumers who called the toll-free telephone number were told by the defendants' telemarketers that for a fee of $89.95 they would receive everything they needed to start working at home. In numerous instances, the telemarketers stated that consumers would earn $30,000 working part-time, $1,000 per week, or would be able to charge $10-$50 per hour. Consumers were often told that if they purchased the defendants' program, they would be given the names of companies in their particular area that were looking for at-home workers. In fact, the FTC alleged, the defendants' earnings claims were false and when consumers tried to contact the listed companies, they often found the telephone numbers outdated. If they did get through, the consumers were told that the company did not have any relationship with the defendants, and neither wanted nor needed the consumers' services. Before purchasing the defendants' program, consumers were told that it came with a 90-day money back guarantee. However, when consumers complained about the product, they were told for the first time that they had to go through several steps, such as trying to contact several companies on the list; creating several business forms; and keeping the product for 60 to 90 days, before they could get a refund. Under the settlement, which required the court's approval, the defendants are prohibited from making false or misleading statements when engaged in the promotion or sale of any products or services. In addition, they are banned for seven years from engaging in the promotion or sale of work-at-home business opportunities. The settlement further prohibits them from selling or disclosing their customer lists. Finally, the settlement contains various recordkeeping provisions to assist the FTC in monitoring the defendants' compliance with the order. |
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