FTC Obtains Contempt Ruling Against ‘Yellow Pages’ Scam

At the Federal Trade Commission’s request, a federal court has banned Robert Ray Law and his company, CPU Service Incorporated (CPU) from sending unsolicited direct mail to advertise or promote goods or services, imposed a judgment of almost $400,000, and required them to immediately pay $45,000.

In July 2014, the FTC charged Law and Your Yellow Book Inc. (YYB) with using bogus invoices to trick small businesses, doctors’ offices, retirement homes, and religious schools into paying for unordered online business directory listings. In December 2014, a final order banned them from the directory business and prohibited them from misrepresenting that consumers owe money for a good or service.

According to FTC, Law created CPU to run a virtually identical scam, faxing fake invoices to nearly 150,000 small businesses across the country seeking payment for online computer support and consulting. As a result, in August 2015, the FTC asked the court to hold Law and CPU in contempt of the YYB order.

The order announced today modifies the 2014 order, awards a judgment for the full amount of money taken from businesses, and requires payment of Law’s remaining liquid assets to the FTC.

The U.S. District Court for the Western District of Oklahoma, Oklahoma City Division, entered the contempt order on October 30, 2015.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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  1. FTC Obtains Court Order Barring Remaining AuraVie Skincare Sellers from Deceptive Marketing and Billing Practices
  2. FTC Returns Money to Consumers in Online ‘Yellow Pages’ Scam
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FTC Seeks Public Input in Review of Holder Rule

As part of the Federal Trade Commission’s systematic review of all current FTC rules and guides, the FTC is seeking public comment on the efficiency, costs, benefits, and impact of the Holder Rule, which protects the rights of consumers who make a purchase using credit obtained through a merchant.

The Rule, formally called the “Trade Regulation Rule Concerning Preservation of Consumers’ Claims and Defenses,” protects consumers when merchants sell a consumer’s credit contract to other lenders. Specifically, it preserves consumers’ right to assert the same legal claims and defenses against anyone who purchases a credit contract, as they would have against the seller who originally provided the credit. Under the Rule, consumers can cite a seller’s misconduct in order to defend themselves against a creditor’s lawsuit for money owed under a contract, or to seek a refund of money they have paid under the contract.

The Commission vote approving the Federal Register Notice was 4-0. It is available on the FTC’s website and will be published in the Federal Register soon. Instructions for filing comments appear in the Federal Register Notice. Comments must be received by February 12, 2016; they will be posted at https://www.ftc.gov/policy/public-comments. (FTC File No. P164800; the staff contact is Stephanie Rosenthal, Bureau of Consumer Protection, 202-326-3332)

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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FTC Staff Advises New York State Public Service Commission On Improving Proposal to Transform Electric Distribution System

The Federal Trade Commission staff submitted a comment in the New York State Public Service Commission’s (NY PSC’s) Reforming the Energy Vision (REV) proceeding regarding that agency’s “Staff White Paper on Ratemaking and Utility Business Models” (Revenues White Paper). The REV proceeding seeks, among other things, to restructure New York State’s electricity distribution system in the face of a number of key developments, such as technical advances in distributed energy resources (DERs), increased concerns about the environmental effects of power generation, and consumers’ interest in customized electricity services.

The FTC staff comment, submitted in reply to comments that other parties filed concerning the Revenues White Paper, addresses the NY PSC staff’s views on how to blunt electric distribution utilities’ incentives to discriminate against independently owned and operated DER projects.

The FTC staff comment suggests that the Revenues White Paper, which describes the REV’s objectives only in terms of lower prices or lower power bills, should also focus on improvements to electric system efficiency and on increases in the value that customers derive from customized electricity services. The comment encourages the NY PSC to consider concerns about potential cross-subsidization by distribution utilities and unfair competition in services that independent firms provide to DER investors, owners, and organizers. It also suggests adjustments to some of the distribution utilities’ financial incentives in order to improve customer benefits and avoid harm to competition and efficiency.

The Commission vote authorizing the staff comment was 4-0.  (FTC File No. V140012; the staff contact is John H. Seesel, Associate General Counsel for Energy, Office of the General Counsel, 202-326-2702.)

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FTC Requires NXP Semiconductors N.V. to Divest RF Power Amplifier Assets as a Condition of Acquiring Freescale Semiconductor Ltd.

NXP Semiconductors N.V. has agreed to sell its RF power amplifier assets in order to settle FTC charges that its proposed $11.8 billion acquisition of Freescale Semiconductor Ltd. is anticompetitive.

According to the complaint, without a divestiture, it is likely that the proposed merger would substantially lessen competition in the worldwide market for RF power amplifiers, likely resulting in higher prices and reduced innovation.

The Netherlands-based NXP and the Austin, Texas-based Freescale develop and manufacture semiconductor products for a wide range of electronic systems. According to the complaint, the worldwide market for RF power amplifiers – semiconductors that amplify radio signals used to transmit information between electronic devices such as cellular base stations and mobile phones – is extremely concentrated, with Freescale and NXP supplying more than 60 percent, and Infineon Technologies AG as the only other significant competitor.

The proposed consent order preserves competition by requiring NXP to divest all its assets that are used primarily for manufacturing, research, and development of RF power amplifiers to the Chinese private equity firm Jianguang Asset Management Co. Ltd. These assets include a manufacturing facility in the Philippines, a building in the Netherlands to house management and some testing labs, as well as all patents and technologies used exclusively or predominantly for the RF power amplifier business, and a royalty-free license to use all other NXP patents and technologies required by that business. The divestiture also includes all of NXP’s RF power amplifier employees and managers.  

The divestiture package provides Jianguang Asset Management with the assets it needs to compete effectively in the RF power amplifier market and successfully replace the competition that otherwise would have been lost through the proposed acquisition. NXP must refrain for two years from soliciting its former employees and managers. A monitor will oversee NXP’s compliance with the obligations set forth in the order, and if NXP does not fully comply, the Commission may appoint a divestiture trustee to ensure that the terms of the order are met. Further details about the divestiture are set forth in the analysis to aid public comment for this matter.

Throughout the investigation, Commission staff cooperated with staff of the antitrust agencies in the European Union, Japan and Korea, including on the analysis of the proposed transaction and potential remedies, to reach compatible approaches on an international scale.

The Commission vote to issue the complaint and accept the proposed consent order for public comment was 4-0. The FTC will publish the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning today and continuing through December 28, 2015, after which the Commission will decide whether to make the proposed consent order final. Comments can be filed electronically or in paper form by following the instructions in the “Supplementary Information” section of the Federal Register notice. 

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $16,000 per day.

The FTC’s Bureau of Competition works with the Bureau of Economics to investigate alleged anticompetitive business practices and, when appropriate, recommends that the Commission take law enforcement action. To inform the Bureau about particular business practices, call 202-326-3300, send an e-mail to antitrust{at}ftc{dot}gov, or write to the Office of Policy and Coordination, Bureau of Competition, Federal Trade Commission, 600 Pennsylvania Ave., NW, Room CC-5422, Washington, DC 20580. To learn more about the Bureau of Competition, read Competition Counts. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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FTC To Host Data Security Conference in Seattle Feb. 9

The Federal Trade Commission will host a one-day conference in Seattle on Feb. 9, 2016, on how companies can build security into their products and services. The event will have a particular focus on guidance for startups and early stage businesses about how to make security considerations a part of a company’s culture from the start.

FTC Commissioner Julie Brill will provide opening remarks for the conference, which will be the third “Start with Security” event nationwide. The conference will bring together experts in data security to provide guidance to businesses.

The conference will take place at the University of Washington School of Law, and is co-sponsored by the University of Washington Tech Policy Lab and the University of Washington School of Law’s Technology Law and Public Policy Clinic. A full agenda will be made available in the weeks leading up to the conference.

In addition to holding conferences around the country, the FTC has created extensive new business education materials to help companies think about how to incorporate strong security practices.

The business guidance lays out ten key steps to effective data security drawn from the alleged facts in the FTC’s data security cases and is designed to provide an easy way for companies to understand the lessons learned from those previous cases. Available as a guidebook and a series of videos, the guidance includes references to the cases, as well as plain-language explanations of the security principles at play.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

 

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Ohio Auto Dealers Settle FTC Charges That They Deceived Consumers By Failing to Disclose Key Lease Terms

Two Ohio auto dealers have agreed to settle Federal Trade Commission charges that they deceived consumers with advertisements that touted low monthly car lease payments but failed to disclose key terms of the offers.

The FTC’s administrative complaint alleged that Progressive Chevrolet Company and Progressive Motors Inc., of Masillon, Ohio, failed to properly disclose terms such as the total amount due at signing, whether a security deposit was required, and credit score requirements. According to the agency, typical consumers could not qualify for the advertised terms. They are charged with violating the FTC Act and the Consumer Leasing Act and Regulation M.

Progressive Chevrolet Company, also does business as Progressive Auto Group, Progressive Jeep, and Progressive Chrysler, and Progressive Motors Inc., also does business as Progressive Ram and Progressive Chrysler Jeep Dodge Inc.

The proposed settlement order, which will remain in effect for 20 years, prohibits the respondents from advertising misleading lease or financing terms. It also requires them to clearly and conspicuously disclose all qualifications or restrictions on a consumer’s ability to obtain the advertised terms. If the ad states that consumers must meet a certain credit score in order to qualify for the offer and a majority of consumers are not likely to meet the stated credit score, the ad must clearly and conspicuously disclose that fact.

The respondents are also barred from advertising a payment amount, or that any or no initial payment is required, without clearly disclosing that the transaction is a lease, the total amount due at consummation or delivery, the number of payments and their amounts and timing, whether or not a security deposit is required, and that there may be an extra charge at the end of the lease where the consumer’s liability (if any) is based on the difference between the vehicle’s residual value and its value at the end of the lease.

The Commission vote to issue an administrative complaint and accept the proposed consent agreement was 4-0. The FTC will publish a description of the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning today and continuing through December 28, 2015, after which the Commission will decide whether to issue the order on a final basis. Interested parties can submit written comments electronically.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $16,000.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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Ginger Jin Named Director of FTC’s Bureau of Economics; Alison Oldale Named BE Deputy Director for Antitrust

Federal Trade Commission Chairwoman Edith Ramirez has appointed Professor Ginger Zhe Jin as Director of its Bureau of Economics, succeeding Francine Lafontaine, who is returning to the University of Michigan. She has also named Alison Oldale as the Bureau’s Deputy Director for Antitrust.

“We are very pleased that Ginger Zhe Jin will join the Federal Trade Commission as Director of the Bureau of Economics, and that Alison Oldale will serve as Deputy Director for Antitrust. Professor Jin brings to us unique and extraordinary research-based expertise on a variety of issues that span both the competition and consumer protection missions of the agency.  Dr. Oldale is a highly regarded antitrust economist with exceptionally deep and broad experience acquired through service in both the public and private sectors. Their combined expertise and experience will contribute greatly to the Commission in fulfilling its competition and consumer protection missions,” Chairwoman Ramirez said. “I am grateful to Francine Lafontaine for her outstanding work as Bureau Director. Under her able leadership, the Bureau of Economics has continued to make vitally important contributions to the Commission’s work on behalf of American consumers.”

Jin, who will begin her new role in January, has been serving the FTC as a fellow while on sabbatical from the University of Maryland. She is a Professor of Economics at the University of Maryland College Park, a Research Associate of the National Bureau of Economic Research, co-editor of the Journal of Economics & Management Strategy, and co-founder of Hazel Analytics, Inc. Jin’s research has focused on information asymmetry among economic agents, with studies including restaurant food safety, health insurance, prescription drugs, online trading, online reviews, and regulatory inspection.

Jin earned a doctorate in Economics from UCLA, master’s degrees in economics from UCLA and the Graduate School of the People’s Bank of China, and a bachelor’s degree in economic management from the University of Science and Technology of China.

Alison Oldale, who will join the agency in December, is an Executive Vice President at Compass Lexecon in Washington, DC, with expertise in pharmaceuticals, transport, entertainment and media, intellectual property, telecommunications, and healthcare. She previously worked for the FTC as Deputy Director for Antitrust on a detail assignment from the United Kingdom’s Competition Commission, where she was Chief Economist. She also has served as a director at the economics consulting firm LECG.

Oldale earned a doctorate in economics and a master’s degree in econometrics and mathematical economics from the London School of Economics, and a bachelor’s degree in economics from the University of Cambridge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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Cybersecurity Awareness Resources

FIL-55-2015
November 23, 2015

Cybersecurity Awareness Resources

Printable Format:

FIL-55-2015 – PDF (PDF Help)

Summary:

As part of the FDIC’s Community Banking Initiative, the agency is adding to its cybersecurity awareness resources for financial institutions. These include a Cybersecurity Awareness video and three new vignettes for the Cyber Challenge, which consists of exercises that are intended to encourage discussions of operational risk issues and the potential impact of information technology disruptions on common banking functions.

Statement of Applicability to Institutions with Total Assets under $1 Billion: This Financial Institution Letter applies to all FDIC-supervised financial institutions.

Highlights:

Community financial institutions may be exposed to operational risks through internal or external events ranging from cyber attacks to natural disasters. Operational risks can threaten an institution’s ability to conduct basic business operations, impact its customer service, and tarnish its reputation. To help community financial institutions assess and prepare for these risks, the FDIC is incorporating new tools to its Directors’ Resource Center at https://fdic.gov/regulations/resources/director/.

  • Cyber Challenge facilitates discussion between financial institution management and staff about operational risk issues. The exercises are designed to provide valuable information about an institution’s current state of preparedness and identify opportunities to strengthen resilience to operational risk. The first four Cyber Challenge videos and supporting discussion materials were released in early 2014 and are available at the Directors’ Resource Center. Cyber Challenge now consists of:
    • Seven scenarios presented through short video vignettes;
    • Associated challenge questions;
    • Reference materials; and
    • An instructional guide.
  • Cyber Challenge is not a regulatory requirement; rather, it is an optional tool to assist financial institutions in strengthening their resilience to operational risk. Cyber Challenge is available at https://www.fdic.gov/regulations/resources/director/technical/cyber/purpose.html.

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FTC Sends Refund Checks Totaling More Than $250,000 To Consumers Who Bought Lipidryl Weight Loss Supplement

The Federal Trade Commission is mailing 1,596 refund checks totaling $250,485 to consumers nationwide who bought the dietary supplement Lipidryl for purported weight loss. These are legitimate refund checks, and must be cashed within 60 days of the date they are issued, or will become void.

The refunds stem from a December 2014 settlement with the marketers of Lipidryl. According to the FTC’s complaint, Bioscience Research Institute LLC, the company that sold Lipidryl charged $129.99 for a three-month supply of Lipidryl, which contains African mango seed extract. The FTC complaint charged that ads for Lipidryl falsely claimed that the supplement was clinically proven to cause substantial weight loss (such as 28 pounds in 10 weeks) and reduce users’ waistlines.

Rust Consulting, Inc., the redress administrator for this matter, will mail refund checks to eligible consumers starting today. Each consumer will receive a full refund for their purchase. The checks must be cashed within 60 days of the date they are issued.

The FTC never requires consumers to pay money or provide information before redress checks can be cashed. Any questions can be directed to Rust Consulting at 877-690-7102.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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FTC Offers Top 10 Holiday Shopping Tips For Consumers, And Advice For Online Retailers

Whether you’re shopping by phone, mail or online this holiday season, the Federal Trade Commission offers 10 tips to help you shop wisely and save a few bucks, too. Need tips on making a shopping budget, comparing prices, taking advantage of rebates and layaway, and protecting your identity when shopping online? Check out consumer.ftc.gov for helpful information.

In addition, an FTC business blog post, Cyber Monday success: Five tips for online retailers, advises merchants to honor their delivery promises, prevent back-order blunders, avoid illegal negative option sales, make return policies clear, and maintain high security standards to prevent fraud and identity theft. Learn more at business.ftc.gov.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.

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