News Flash What Do You Think? Reports Coming Events New Consumer Products Tip of the Month — A NOTE TO HOMEOWNERS Numbers to Know

NEWS FLASH

FLU TREATMENT SCAMS. The FTC and the U.S. Food and Drug Administration are alerting the public to be wary of Internet sites and other promotions for products that claim to diagnose, prevent, mitigate, treat, or cure the 2009 H1N1 influenza virus. These fraudulent products come in all varieties, including dietary supplements, foods, or products purporting to be drugs, devices or vaccines. Such fraudulent products will not prevent the transmission of the virus or offer effective treatments against infections caused by the H1N1 influenza virus. Press release: www.ftc.gov/opa/2009/05/swineflu.shtm.

MORTGAGE FRAUD. The FTC has sued five operations that deceptively marketed their mortgage modification and home foreclosure relief services, including several that gave the false impression they were affiliated with the federal government. This brings to 11 the number of such cases the FTC has brought in the last year. The FTC also sent warning letters to 71 companies that may be deceptively marketing these services. Press release: www.ftc.gov/opa/2009/04/hud.shtm.

MOD SQUAD. The FTC, with the U.S. Departments of the Treasury, Justice, and Housing and Urban Development, and the Attorney General of Illinois announced new initiatives regarding loan modifications and foreclosure rescue scams to coordinate their resources to alert financial institutions to emerging schemes, step up enforcement actions, and educate consumers to help those in financial trouble avoid becoming victims. Press release: www.ftc.gov/opa/2009/04/loanfraud.shtm.

PONZI SCHEME. At the FTC’s request, a federal court has ordered the operators of an “Internet kiosk” business opportunity scam and Ponzi scheme to pay $18.9 million. The FTC will distribute more than $2 million to the victims. The court found that Charles and Elizabeth Castro, Network Services, and their affiliates violated federal law by duping hundreds of buyers with promises of lucrative earnings. The Internet kiosks were supposed to allow public access to the Internet, for a fee, from hotels, bowling alleys, and convenience stores. Monthly “revenue” payments sent to investors came from money paid by new investors. Press release: www.ftc.gov/opa/2009/04/nsd.shtm.

DIRECT TV. Satellite television provider DIRECTV and Comcast Corp., one of the nation’s largest providers of cable and Internet services, have agreed to pay a total of $3.21 million to settle separate FTC charges that they violated federal law, including allegedly calling people who had told the companies not to call them again. DIRECTV has agreed to pay $2.31 million; Comcast has agreed to pay $900,000. Press release: www.ftc.gov/opa/2009/04/directv.shtm.

KELLOGG. Kellogg Company, the world’s leading cereal producer, has settled FTC charges that advertising claims touting a breakfast of Frosted Mini-Wheats as “clinically shown to improve kids’ attentiveness by nearly 20%” were false and violated federal law. According to the clinical study referred to in Kellogg’s advertising, only about half the children who ate Frosted Mini-Wheats for breakfast showed any improvement in attentiveness, and only about one in nine improved by 20 percent or more. Press release: www.ftc.gov/opa/2009/04/kellogg.shtm.

TRUE COLORS. Chemical giant BASF agreed to sell certain assets to complete a $5.1 billion acquisition of rival Ciba Holding Inc. and settle FTC charges that the deal would reduce competition in worldwide markets for two high performance pigments.  The FTC order requires BASF to sell all assets, including intellectual property, related to bismuth vanadate and indanthrone blue, which are pigments used to color cars, building materials, construction equipment, inks, and plastics. Press release: www.ftc.gov/opa/2009/04/basf.shtm.

FAKE CHECKS. At the request of the FTC, a federal court has stopped a lottery and prize-promotion scam that used counterfeit cashier’s checks and false promises of big cash prizes to bilk people out of thousands of dollars each. The court ordered Cash Corner Services, Inc., and their affiliates and principals to pay $1 million. According to the FTC, the defendants mailed letters congratulating people on winning a lottery or sweepstakes, and enclosed a fake check they said was for taxes or fees that had to be paid before  “winnings” could be collected. Prize winnings supposedly ranged from $250,000 to $750,000. People deposited the checks and wired the money, only to learn that the original checks were counterfeit and they were out any money they wired to pay the “fees.” They received nothing, despite the fact that some sent as much as $24,000 for “fees.” Press release: www.ftc.gov/opa/2009/04/cashcorner.shtm.

WHAT DO YOU THINK?

The FTC is seeking public comment on these proposed rules.

PETROLEUM INDUSTRY.

Deadline for comments: May 20.

This revised proposed rule would prohibit market manipulation in the petroleum industry. Once the FTC reviews the comments, it will issue a final rule. Press release: www.ftc.gov/opa/2009/04/rnprm.shtm.          

PRIVACY OF HEALTH INFORMATION.

Deadline for comments: June 1.

This proposed rule would require organizations to notify people when the security of their electronic health information is breached. A new federal law includes provisions to advance the use of health information technology and to strengthen privacy and security protections for health information. To file a public comment, click  https://secure.commentworks.com/ftc-healthbreachnotification  and follow the instructions. Press release: www.ftc.gov/opa/2009/04/healthbreach.shtm.

COOLING OFF RULE.

Deadline for comments: June 22. 

The FTC is reviewing the costs and benefits of its Cooling-Off Rule, which was last amended in October 1995. The Rule requires anyone selling consumer goods or services “door to door” — at a price of at least $25 — to tell buyers about their right to cancel within three business days of buying the product. Press release: www.ftc.gov/opa/2009/04/coolingoff.shtm.

REPORTS

MOBILE COMMERCE. The FTC issued a staff report based on its public town hall meeting and found that the FTC and its law enforcement partners should continue to monitor the impact of unwanted mobile text messages, malware, and spyware on consumers, and take law enforcement action as needed. Press release: www.ftc.gov/opa/2009/04/mobilerpt.shtm.

COMING EVENTS

AT THE FTC.

BIZ OPP RULE. The FTC will hold a public workshop on June 1 to explore proposed changes to the FTC’s Business Opportunity Rule, including the effectiveness of a proposed one-page Business Opportunities Disclosure Form that sellers of business opportunities would have to provide to prospective buyers. The Form is intended to give potential buyers information about earnings claims, legal actions, cancellation or refund policies, and references so they can make an informed decision about the opportunity. Public comments about these issues must be received by June 15. The workshop, which is free and open to the public, will be from 9 am to 5 pm at the FTC’s satellite building Conference Center, 601 New Jersey Avenue, N.W., Washington, DC. All attendees must display a current driver’s license or other form of photo identification for entry. Press release: www.ftc.gov/opa/2009/04/bizopp.shtm.

ON THE ROAD.

IP. The FTC will hold a hearing May 4 and 5 in California in cooperation with the Berkeley Center for Law and Technology and the Berkeley Competition Policy Center to explore how markets for patents and technology operate in different industries, whether those markets operate efficiently, and how patent policy might better promote innovation and competition. The hearing is free, open to the public and will be held at the Haas School of Business, Wells Fargo Room, 2220 Piedmont Avenue, Berkeley. Registration is not required. Press release: www.ftc.gov/opa/2009/04/iphearing.shtm.

NEW CONSUMER PRODUCTS

BOOKMARKS. Visit www.ftc.gov/bulkorder to order these new products.

MONEY MATTERS. Features practical tips on topics like credit repair, debt collection, job-hunting and jobs scams, vehicle repossession, managing mortgage payments, and foreclosure rescue scams. 8.5"x2.5", 2 sided, color. www.ftc.gov/bcp/edu/pubs/consumer/bookmarks/bmk15.pdf

A NOTE TO HOMEOWNERS. Provides information to help homeowners avoid scams targeting people having trouble paying their mortgage. 8.5"x2.5", 2 sided, color.

English: www.ftc.gov/bcp/edu/pubs/consumer/bookmarks/bmk13.pdf

Spanish www.ftc.gov/bcp/edu/pubs/consumer/bookmarks/sbmk13.pdf

CURIOUS? ASK. Learn the telltale signs of cancer treatment scams and questions to ask the doctor about products sold online that claim to cure or treat cancer. 8.5"x2.5", 2 sided, color. www.ftc.gov/bcp/edu/pubs/consumer/bookmarks/bmk14.pdf 

CONSUMER SENTINEL/MILITARY. Tells military members and their families how to file a complaint with the FTC, using Consumer Sentinel/Military, the military portal of the Consumer Sentinel Network. 2.5"x8.5", 2 sided, color.   www.ftc.gov/bcp/edu/pubs/consumer/bookmarks/bmk12.pdf

TIP OF THE MONTH — A NOTE TO HOMEOWNERS

No doubt many of your constituents are facing economic challenges these days. Some may be facing foreclosure. Scammers are targeting people having trouble paying their mortgages: Some claim to be able to “rescue” homeowners from foreclosures, while others promise loan modifications – for a fee. The FTC wants people to know how to avoid scams that could make their housing situation go from bad to worse. Share these tips with homeowners in your district.

To download A Note to Homeowners, go to www.ftc.gov/bcp/edu/pubs/consumer/homes/rea16.shtm.

NUMBERS TO KNOW

FTC'S OFFICE OF CONGRESSIONAL RELATIONS: 202-326-2195.

Check out the CONGRESSIONAL RESOURCES portion of our website at
www.ftc.gov/ocr/index.shtml. No password needed to access.

ORDERING FTC's FREE CONSUMER INFORMATION
-- For one to 49 copies of FTC publications, call 1-877-FTC-HELP (1-877-382-4357).
-- For 50 or more copies of publications, visit www.ftc.gov/bulkorder
-- If you need a copy of any publication immediately, you can view, download, and print from www.ftc.gov
-- For special orders, email Derick Rill at drill@ftc.gov

To file a fraud complaint, visit www.ftc.gov or call 1-877-FTC-HELP (1-877-382-4357).

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