September 2022

FTC Releases Agenda for Virtual Event on Digital Advertising to Kids

The Federal Trade Commission released the final agenda for its October 19 virtual kids digital advertising event that will explore how best to protect children from a growing array of marketing practices that make it difficult or impossible for children to distinguish ads from entertainment in digital media. The event, Protecting Kids from Stealth Advertising in Digital Media, will examine the current kids digital advertising landscape, its impact on children, and whether current legal and regulatory regimes are equipped to protect children from potential harms.

FTC Chair Lina M. Khan will provide opening remarks to kick off the event and will be followed by two presentations discussing the range of digital spaces children, including teens, frequent and the types of advertising and marketing techniques used to advertise to them. The event will also feature three panel discussions focused on:

  • Children’s cognitive abilities: Panelists will examine children’s cognitive abilities at different ages and developmental stages to recognize and understand advertising content and to distinguish it from other content.
  • Current advertising landscape: Panelists will explore the impacts of the current advertising landscape, including any harms stemming from children’s inability to distinguish advertising from other content.
  • Possible solutions: Panelists will discuss the current legal regime, its challenges, and potential ways to protect children from any harmful effects related to digital marketing and advertising.

The event, which begins at 9 a.m. ET, will be webcast on the FTC’s website, Registration is not required to watch the webcast. Information on the panelists and other speakers can be found on the event page. The public will have until November 18, 2022 to submit comments on the topics that will be discussed at the event.

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Federal Trade Commission, California Take Action To Shut Down Mortgage Relief Operation that Preyed on Struggling Homeowners

The Federal Trade Commission and the California Department of Financial Protection and Innovation (DFPI) are taking action against various companies doing business as Home Matters USA, Academy Home Services, Atlantic Pacific Service Group, and Golden Home Services America, and the owners of the companies, Dominic Ahiga and Roger Scott Dyer, for operating a sham mortgage relief operation that misled consumers and cost them millions. In the first case brought jointly by the two agencies, the FTC and DFPI allege that the companies charged consumers thousands of dollars with false promises they would negotiate with consumers’ mortgage lenders to alter their loans, at times even representing they were affiliated with government COVID-19 relief programs. A federal court has temporarily shut down the operation and frozen the assets of the defendants in the case.  

“At a time when millions of Americans were dealing with a pandemic and struggling to pay their mortgages, defendants preyed on consumers with false promises of mortgage assistance relief” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We are excited to build on our relationship with California’s DFPI in this case and will continue to work with our state partners to shut down schemes that take advantage of consumers experiencing financial hardship.”

“Illegal mortgage relief assistance schemes prey on the most vulnerable homeowners and are a significant threat to the generational wealth that home ownership provides for consumers,” said DFPI Commissioner Clothilde Hewlett. “The DFPI has taken strong, decisive action against the companies behind this scheme using the California Consumer Financial Protection Law to put a stop to their illegal activities and protect not only California consumers, but also consumers nationwide.”

The defendants have pitched their services under a number of names, including Academy Home Services, Atlantic Pacific Service Group, Golden Home Services America, and Home Matters USA among others. The FTC and DFPI complaint alleges that they have been deceiving consumers since at least June of 2018 with false promises that they can negotiate lower interest rates or payments.

The investigation in this case found that the defendants target distressed homeowners with their deceptive claims in telemarketing calls, text messages and online ads, often promising that in just three months, they can get consumers’ mortgages modified. In many cases, the complaint alleges, they claimed to be affiliated with government agencies or that their services were part of government COVID-19 assistance programs. When consumers paid for the defendants’ services, they rarely, if ever, get the promised modifications, and instead are harmed by the scheme in numerous ways:

  • Deceiving consumers about their services: The defendants, as part of the sales process, regularly misled consumers, saying they had a track record of success and were able to “beat the system.” Consumers would receive documents with bogus claims about specific changes to their mortgage, including lowered interest rates or payments, but the complaint alleges that the defendants regularly failed to deliver any meaningful benefit to consumers.
  • Costing consumers money and harming their credit: While the defendants charged consumers, many of whom were already struggling with mortgage payments, hundreds or even thousands of dollars, the harms extended beyond that loss. In many cases, the defendants told consumers not to pay their mortgage while using their “services,” leading to many consumers facing late fees and significantly lower credit scores.
  • Costing consumers their homes: According to the complaint, the defendants require consumers to sign “cease and desist” letters that are sent to their mortgage lender, requiring the lenders to communicate only with the defendants. By not receiving notices of missing payments or default even as they continue to pay defendants, some consumers have found themselves in foreclosure.

The complaint alleges that the defendants’ practices violate numerous laws and regulations, including the FTC Act, the Mortgage Assistance Relief Services Rule, the Telemarketing Sales Rule, the COVID-19 Consumer Protection Act, and the California Consumer Financial Protection Law.

The individual defendants in this case are Dominic Ahiga and Roger Scott Dyer.  The corporate defendants in this case are Apex Consulting & Associates, Inc., Green Equitable Solutions, Infocom Entertainment Ltd, Inc., and South West Consulting Enterprises, Inc. 

The Commission vote authorizing the staff to file the complaint and request for a temporary restraining order was 5-0. The complaint was filed in the U.S. District Court for the Central District of California. The court entered the temporary restraining order against the defendants on September 14, 2022.

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FTC to Crack Down on Companies Taking Advantage of Gig Workers

The Federal Trade Commission has announced enforcement priorities to fight for consumers who work in jobs that are part of the gig economy. In a new policy statement adopted today, the Commission outlined a number of issues facing gig workers, including deception about pay and hours, unfair contract terms, and anticompetitive wage fixing and coordination between gig economy companies.

“No matter how gig companies choose to classify them, gig workers are consumers entitled to protection under the laws we enforce,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We are fully committed to coordinating our consumer protection and competition enforcement efforts within the FTC as well as working with other agencies across the government to ensure gig workers are treated fairly.”

  • Misrepresentations about the nature of gig work: While gig companies promote independence to potential workers, in practice these firms may tightly prescribe and control their workers’ tasks in ways that run counter to the promise of independence and an alternative to traditional jobs.
  • Diminished bargaining power: Workers have little leverage to demand transparency from gig companies, even in the face of unclear information about when work will be available, where they will have to perform it, or how they will be evaluated.
  • Concentrated markets: Markets populated by gig companies are often concentrated, resulting in reduced choice for workers, customers, and businesses. These companies may be more likely to exert their market power in anticompetitive ways that harm workers’ wages, job quality, and other aspects of gig work.

The policy statement makes clear that the FTC’s authority to enforce both competition and consumer protection laws in the gig economy is not affected by how companies choose to classify the consumers who perform gig work. In the statement, the Commission names multiple areas where the Commission will aim to prevent harm to consumers:

  • Holding companies accountable for claims and conduct about costs and benefits: Gig companies must not be deceptive in their claims to prospective gig workers about potential earnings, and they must be transparent and truthful about costs borne by workers.
  • Combating unlawful practices and constraints imposed on workers: Gig companies using artificial intelligence or other advanced technologies to govern workers’ pay, performance, and work assignments are still required to keep promises they make to workers. Companies must also ensure that any restrictive contract terms, including those limiting workers from seeking other jobs, do not violate the FTC Act or other laws.
  • Policing unfair methods of competition that harm gig workers: The FTC will investigate evidence of agreements between gig companies to illegally fix wages, benefits, or fees for gig workers that should be open to competition. The FTC will also investigate exclusionary or predatory conduct that could cause harm to customers or reduced compensation or poorer working conditions for gig workers.

The policy statement notes that companies that fail to follow the laws governing unfair, deceptive, or anticompetitive practices could be obligated to pay consumer redress and civil penalties and may be ordered to cease unlawful business practices. The Commission also notes in the statement that it will partner with other governmental agencies to protect gig workers.

The Commission voted 3-2 at an open meeting to adopt the policy statement, with Commissioners Noah Joshua Phillips and Christine S. Wilson voting in the negative.

Workers who believe that their labor rights have been violated can call 1-844-762-6572 for assistance filing an unfair labor practice charge. Or they can contact their closest National Labor Relations Board Field Office or submit a charge on the NLRB’s website.

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FTC Proposes New Rule to Combat Government and Business Impersonation Scams

The Federal Trade Commission has proposed a rule to fight government and business impersonation scams—a perennial scourge that has cost consumers hundreds of millions of dollars over the past five years. The proposed rule would codify the well-understood principle that impersonation scams violate the FTC Act, as do those who provide impersonators with the means to harm consumers. The proposed rule would allow the Commission to recover money from, or seek civil penalties against, scammers who harm consumers in violation of the rule.

“The proposed rule will expand the Commission’s toolkit to combat the significant harm caused by government and business impersonation frauds,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “We look forward to comments from the public on our efforts to deter fraud, hold impersonators accountable, and secure redress for consumers.” Explore Data with the FTC: Find out about consumer fraud reports in your state and nationally

Fraud reports to the FTC about government and business impersonation scams rose sharply at the beginning of the COVID-19 pandemic. The FTC received more than 2.5 million reports of these scams from consumers nationwide from the beginning of 2017 through the middle of 2022, and those consumers reported losing more than $2 billion to these scams.

Government and business impersonators can take many forms, posing as, for example, a lottery official, a government official or employee, or a representative from a well-known business or charity. Impersonators may also use implicit representations, such as misleading domain names and URLs and “spoofed” contact information, to create an overall net impression of legitimacy. These scammers are fishing for information they can use to commit identity theft or seek monetary payment, often requesting funds via wire transfer, gift cards, or increasingly cryptocurrency.

The proposed rule announced today follows an Advance Notice of Proposed Rulemaking published by the Commission last December. In response to that notice, the FTC received more than 160 public comments, none of which opposed proceeding with the rulemaking process. Comments came from members of the public as well as a bipartisan coalition of 49 state attorneys general and multiple companies and industry organizations.

In the Notice of Proposed Rulemaking announced today, the Commission is seeking comment on proposed measures that would fight government and business impersonation scams by declaring various tactics used by scammers unlawful. These include posing as a government or business by name or by implication. For example, the proposed rule would ban scammers from:

  • Using government seals or business logos when communicating with consumers by mail or online.
  • Spoofing government and business emails and web addresses, including spoofing “.gov” email addresses or using lookalike email addresses or websites that rely on misspellings of a company’s name.
  • Falsely implying government or business affiliation by using terms that are known to be affiliated with a government agency or business (e.g., stating “I’m calling from the Clerk’s Office” to falsely imply affiliation with a court of law).  

The proposed rule would also apply to those who provide “means or instrumentalities” for those committing a government or business impersonation scam, such as a supplier who manufactures a fake government credential used by scammers. In addition, the proposed rule would include non-profit organizations in its definition of businesses, so that it would apply to scammers that impersonate charities.

The proposed rule would allow the FTC to seek important relief for consumers across a broad array of government and business impersonation cases. This is especially important following the Supreme Court’s ruling in AMG Capital Management LLC v. FTC, which significantly limited the agency’s ability to return to consumers money that was taken in a scam.

The notice includes questions for public comment to inform the Commission’s decision-making on the proposal. These include questions about provisions in the proposed rule and whether other provisions should or should not be included in the rule. After the Commission reviews the comments received, it will decide whether to take the necessary next steps toward issuance of a final rule.

The Commission vote to approve the Federal Register notice announcing the notice was 5-0. The notice will be published in the Federal Register soon. Instructions for filing comments appear in the notice. Comments must be received within 60 days of the publication of the notice.

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FTC Report Shows Rise in Sophisticated Dark Patterns Designed to Trick and Trap Consumers

The Federal Trade Commission released a report today showing how companies are increasingly using sophisticated design practices known as “dark patterns” that can trick or manipulate consumers into buying products or services or giving up their privacy. The dark pattern tactics detailed in the report include disguising ads to look like independent content, making it difficult for consumers to cancel subscriptions or charges, burying key terms or junk fees, and tricking consumers into sharing their data. The report highlighted the FTC’s efforts to combat the use of dark patterns in the marketplace and reiterated the agency’s commitment to taking action against tactics designed to trick and trap consumers.

“Our report shows how more and more companies are using digital dark patterns to trick people into buying products and giving away their personal information,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “This report—and our cases—send a clear message that these traps will not be tolerated.”

For years, unscrupulous direct-mail and brick-and-mortar retailers have used design tricks and psychological tactics such as pre-checked boxes, hard-to-find-and read disclosures, and confusing cancellation policies, to get consumers to give up their money or data. As more commerce has moved online, dark patterns have grown in scale and sophistication, allowing companies to develop complex analytical techniques, collect more personal data, and experiment with dark patterns to exploit the most effective ones. The staff report, which stems from a workshop the FTC held in April 2021, examined how dark patterns can obscure, subvert, or impair consumer choice and decision-making and may violate the law.

The report, Bringing Dark Patterns to Light, found dark patterns used in a variety of industries and contexts, including e-commerce, cookie consent banners, children’s apps, and subscription sales. The report focuses on four common dark pattern tactics:

  • Misleading Consumers and Disguising Ads: These tactics include advertisements designed to look like independent, editorial content; comparison shopping sites that claim to be neutral but really rank companies based on compensation; and countdown timers designed to make consumers believe they only have a limited time to purchase a product or service when the offer is not actually time-limited. For example, the FTC took action against the operators of a work-from-home scheme for allegedly sending unsolicited emails to consumers that included “from” lines that falsely claimed they were coming from news organizations like CNN or Fox News. The body of these emails included links that sent consumers to additional fake online news stories, and then eventually routed consumers to sales websites that pitched the company’s work-from-home schemes.
  • Making it difficult to cancel subscriptions or charges: Another common dark pattern involves tricking someone into paying for goods or services without consent. For example, deceptive subscription sellers may saddle consumers with recurring payments for products and services they never intended to purchase or that they do not wish to continue purchasing. For example, in its case against ABCmouse, the FTC alleged the online learning site made it extremely difficult to cancel free trials and subscription plans despite promising “Easy Cancellation.” Consumers who wanted to cancel their subscriptions were often forced to navigate a difficult-to-find, lengthy, and confusing cancellation path on the company’s website and click through several pages of promotions and links that, when clicked, directed consumers away from the cancellation path. 
  • Burying key terms and junk fees: Some dark patterns operate by hiding or obscuring material information from consumers, such as burying key limitations of the product or service in dense terms of service documents that consumers don’t see before purchase. This tactic also includes burying junk fees. Companies advertise only part of a product’s total price to lure consumers in, and do not mention other mandatory charges until late in the buying process. In its case against LendingClub, the FTC alleged that the online lender used prominent visuals to falsely promise loan applicants that they would receive a specific loan amount and pay “no hidden fees” but hid mention of fees behind tooltip buttons and in between more prominent text.
  • Tricking consumers into sharing data: These dark patterns are often presented as giving consumers choices about privacy settings or sharing data but are designed to intentionally steer consumers toward the option that gives away the most personal information. The FTC alleged that smart-TV maker Vizio enabled default settings allowing the company to collect and share consumers’ viewing activity with third parties, only providing a brief notice to some consumers that could easily be missed.

As detailed in the report, the FTC has worked to keep pace with the evolving types of dark patterns used in the marketplace. The Commission has sued companies for requiring users to navigate a maze of screens in order to cancel recurring subscriptions, sneaking unwanted products into consumers’ online shopping carts without their knowledge, and experimenting with deceptive marketing designs. 

The Commission voted 5-0 at an open meeting to authorize the release of the staff report.

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Federal Trade Commission Returns More Than $415,000 To Consumers Harmed by Deceptive Car Dealer Tate’s Auto

The Federal Trade Commission is sending payments totaling more than $415,000 to 3,508 consumers who financed a car or truck at a Tate’s Auto dealership after January 1, 2013, and later had the vehicle repossessed. Tate’s Auto, which operated dealerships in Arizona and New Mexico, allegedly deceived consumers about payment information and falsified information on consumers’ financing applications.

Eligible consumers will receive a check in the mail, unless they specifically requested a PayPal payment. Recipients should cash checks within 90 days or redeem PayPal payments within 30 days. Consumers who have questions about their refund should call the refund administrator, JND Legal Administration, at 888-964-0009. The Commission never requires people to pay money or provide account information to get a refund.

The FTC sued Tate’s Auto in 2018 for inflating consumers’ income on financing applications to third-party lenders, as well as deceiving consumers about the lease or financing terms of the vehicles they were buying. Many of Tate’s customers were citizens of the Navajo Nation, and Tate’s Auto frequently ran radio and print ads in Navajo media. The FTC settled with the auto dealerships in August 2020 and ultimately reached a settlement with the individual defendant in July 2021 that required the defendant to pay money for consumer redress. The FTC wishes to acknowledge the valuable assistance of the Navajo Nation Human Rights Commission during the investigation of this case.

The Commission’s interactive dashboards for refund data provide a state-by-state breakdown of refunds in FTC cases. In 2021, Commission actions led to more than $472 million in refunds to consumers across the country, but these refunds were the result of cases resolved before the U.S. Supreme Court ruled in 2021 that the Commission lacks authority under Section 13(b) to seek monetary relief in federal court going forward. Because of that ruling, the Commission no longer has its strongest tool to return money to consumers, and it will become harder to provide refunds to consumers harmed by deceptive and unfair conduct going forward. The Commission has urged Congress to restore the Commission’s ability to get money back for consumers.

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FTC, CFPB Submit Amicus Brief Defending Consumers’ Ability to Dispute Inaccurate Items on Credit Reports

The Federal Trade Commission joined the Consumer Financial Protection Bureau (CFPB) in filing an amicus brief with the U.S. Court of Appeals for the Third District in the case of Ingram v. Experian. The brief asks the appeals court to overturn a lower court’s decision that could create an exception to the Fair Credit Reporting Act (FCRA) allowing furnishers of credit information to decline to investigate when consumers dispute inaccurate information in certain circumstances. The brief argues that the holding could undercut a key protection provided by the FCRA that allows consumers to dispute and correct inaccurate information in their credit reports.

“The law gives consumers a right to dispute inaccurate information and have their claim investigated,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC-CFPB brief rejects the argument that there are circumstances when furnishers do not have to follow the law.”

The FCRA provides consumers with two avenues for disputing the accuracy of their credit information that furnishers provide to credit reporting agencies. Consumers can file a dispute directly with furnishers or file a dispute indirectly with the credit reporting agencies, which may refer the dispute to the furnishers.

The FTC and CFPB amicus brief relates to a case involving a request made by a consumer to a furnisher, Comcast Communications, to remove an account from his credit report that was listed as delinquent. The consumer reported to Comcast that he was the victim of identity theft and did not open the account. Comcast rejected this claim after it said the consumer failed to submit proof of his identity theft and later referred the matter to a debt collector. The consumer later made what is considered an indirect dispute by disputing the delinquent account with the credit reporting agency Experian, which sent the dispute to the debt collector, as the furnisher of the inaccurate information.

In response to litigation from the consumer, the lower court ruled in favor of the debt collector, saying that the furnisher is only obligated to investigate “bona fide” indirect disputes and may therefore decline to investigate any dispute it deems frivolous. The FTC and CFPB, however, say that the lower court erred, arguing in their brief that:

  • Furnishers are Required to Investigate: The brief argues that there is nothing in the text of the FCRA that suggests that a furnisher can choose not to investigate indirect disputes if it deems them to be not “bona fide.” The statutory text is unambiguous: furnishers must investigate all indirect disputes, according to the brief.
  • Consumers Would Be Left in the Dark: Under the FCRA, consumers are entitled to be notified about the outcome of their disputes and must be given an opportunity to address any problems with their dispute claims. The district court’s ruling would circumvent those requirements, leaving consumers in the dark and undercutting a central remedy under the FCRA that ensures consumers are able to dispute and correct inaccurate information on their credit reports.
  • Exception is Unnecessary: The exception created by the lower court’s decision is unnecessary because furnishers are already protected in other ways from having to investigate a frivolous dispute. For example, the FCRA requires credit reporting agencies to determine if a dispute is frivolous before forwarding a dispute to the furnisher.

The Commission voted 5-0 to file the amicus brief with the CFPB.

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FTC to Convene First Meeting of Scams Against Older Adults Advisory Group on Sept. 29

Representatives from 13 federal and state government agencies, along with representatives from industry and consumer advocates, will join the Federal Trade Commission on Sept. 29 for the first meeting of the newly formed Scams Against Older Adults Advisory Group.

The advisory group, which was created as part of the Stop Senior Scams Act passed in March of this year, is led by the FTC and will tackle four topics: 1) expanding consumer education efforts; 2) improving industry training on scam prevention; 3) identifying innovative or high-tech methods to detect and stop scams; and 4) developing research on consumer or employee engagement to reduce fraud. The advisory group also will help identify and invite key stakeholders to contribute to the committees’ work.

Agencies and organizations participating in the meeting in addition to the FTC include:

  • AARP
  • AmeriCorps
  • Chamber of Digital Commerce
  • Commodity Futures Trading Commission
  • Consumer Financial Protection Bureau
  • Federal Deposit Insurance Corporation
  • Federal Reserve Board
  • Federal Trade Commission
  • Financial Crimes Enforcement Network
  • Financial Industry Regulatory Authority
  • Innovative Payments Association
  • National Retail Federation
  • Office of the Attorney General for the State of Vermont
  • Retail Gift Card Association
  • Securities and Exchange Commission
  • The Money Services Round Table
  • U.S. Department of Health and Human Services
  • U.S. Department of Justice
  • U.S. Department of Treasury
  • U.S. Postal Inspection Service
  • USTelecom.

The meeting will take place on Sept. 29 at 2:30 p.m. ET and will be livestreamed at

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FTC Sues Marketer of Personal Protective Equipment and Light Fixtures for Advertising Claims About Products Being Made in the USA and Government-Certified

The Federal Trade Commission has referred a complaint to the Department of Justice alleging Adam J. Harmon and two companies he controls falsely told consumers that personal protective equipment they marketed during the pandemic, as well as light fixtures they sold, were made in the United States. The FTC charged Harmon and his two companies, Axis LED Group, LLC and ALG-Health LLC, with violating the COVID-19 Consumer Protection Act, the Made in USA Labeling Rule and the FTC Act. The agency’s proposed order would stop them from making deceptive claims that products were Made in USA – or, that because they were Made in USA, they provided superior protection from COVID-19. The order also would require them to pay a civil penalty for their past deceptive claims. The claims resolved by the settlement are allegations only, and there has been no determination of liability. Defendants neither admit nor deny any of the allegations in the Complaint, except as specifically stated in the Order.

“ALG and its CEO slapped the Made in USA label on masks that were made overseas, and now they’re paying the price,” said Sam Levine, Director of the FTC’s Bureau of Consumer Protection. “As Americans struggle to obtain safe, authentic personal protective equipment, the Commission will use every tool we have to root out false claims and phony labels.”

With the onset of the COVID-19 pandemic in early 2020, Harmon began operating under the name ALG-Health LLC, and selling personal protective equipment such as masks, gowns, and gloves. According to the complaint, Harmon and ALG made numerous false and misleading claims that their PPE products were all or virtually all made in the United States, even though the products were wholly imported, or incorporated significant imported materials or subcomponents. These claims and other false statements – including that the defendants’ products were U.S.-origin respirators, certified by the National Institute for Occupational Safety (NIOSH) – violated the COVID-19 Consumer Protection Act, the complaint alleges. Specifically, the defendants harmed consumers by:

  • Deceiving consumers about the country of origin of their products. Through social media posts, marketing materials, and labels, the defendants claimed that their lighting and COVID-19 personal protective products were manufactured in the United States. In fact, the defendants’ products were almost entirely imported. The defendants’ conduct violated the FTC Act, the Covid-19 Consumer Protection Act, and the Made in the USA Labeling Rule.
  • Deceiving consumers about the efficacy of their COVID-19 PPE products. The defendants claimed to consumers that their PPE products were superior due their country of origin. These false claims deceived consumers and undermined honest competitors.

Enforcement Action

The proposed order settling the FTC’s complaint against Harmon, Axis LED Group, LLC, and ALG-Health LLC prohibits the conduct alleged in the complaint. Harmon and his companies must:

  • Stop making deceptive U.S.-origin labeling and advertising claims. Harmon and his companies are prohibited from claiming that products are made in the United States unless they can (1) show that the product’s final assembly or processing – and all significant processing – takes place in the United States, and that all or virtually all ingredients or components of the product are made and sourced in the United States, or (2) clearly and prominently qualify origin claims to disclose imported content or processing.
  • Provide substantiation. The defendants must substantiate all Made in USA and COVID-19-related claims, and refrain from making misleading claims for any products or services they provide.
  • Pay civil penalties. The defendants must pay a $157.683.37 civil penalty, which is due immediately. The defendants are also subject to a $2.8 million redress judgment, which is suspended due to their inability to pay. Should the FTC discover that the defendants have misstated the value of any assets or failed to disclose them, the agency will seek to have the suspension lifted and the full judgment due immediately.

Protecting consumers and honest businesses from deceptive Made in USA claims is a key priority for the Federal Trade Commission. Over the last year, the agency has brought three other cases in this area, Resident Home, Lions Not Sheep, and Lithionics Battery, LLC. Last August, the Commission voted to finalize the Made in USA Labeling Rule, which enables the Commission to seek civil penalties from companies that make false claims. This is the Commission’s second action this year to enforce the rule.

The FTC’s Enforcement Policy Statement on U.S. Origin Claims provides further guidance on making non-deceptive “Made in USA” claims. 

The Commission vote to authorize the staff to refer the complaint to the DOJ and to approve the proposed consent decree was 5-0. Commissioners Noah Joshua Phillips and Christine S. Wilson issued a joint concurring statement. The DOJ filed the complaint and proposed consent decree on behalf of the Commission in U.S. District Court for the Northern District of Ohio.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. Consent decrees have the force of law when approved and signed by the District Court judge.

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FTC to Host Forum on September 8 on Commercial Surveillance and Lax Data Security Practices

WHAT:The Federal Trade Commission is hosting a public forum regarding its Advanced Notice of Proposed Rulemaking (ANPR) on commercial surveillance and data security practices that harm consumers and competition.WHEN:Thursday, September 8, 2022, 2 p.m. – 7:30 p.m. ETWHERE:The event will be held online. A link to view the forum will be posted to the day of the event and on the event page.WHO:The event will feature remarks by FTC Chair Lina M. Khan, Commissioners Rebecca Kelly Slaughter and Alvaro Bedoya, as well as a staff presentation, two panel discussions, and comments from the public.TWITTER:Follow along with the conversation on the FTC’s Twitter page (@FTC) using the hashtag #ANPRForum.

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