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From: Penn Corner <subscribe@subscribe.ftc.gov>
Date: Wed, Aug 13, 2014 at 6:52 AM
Subject: News from the Federal Trade Commission - August 2014
To: iammejtm@gmail.com

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Does Shopping Make You App-y?

A new staff report issued by the FTC finds that many mobile apps that help people shop don't provide key information — like how the apps manage payment-related disputes or handle consumer data — prior to download. FTC staff looked at popular apps that allow users to compare prices across retailers, find deals and coupons, or pay for purchases while shopping in brick-and-mortar stores. The report recommends that companies that provide shopping apps clarify how they handle unauthorized purchases, explain how consumer information will be collected and shared, and ensure that their data security promises translate into sound data security practices. The FTC also released new tips for people who use shopping apps.

Mortgage Mis-Modification

The FTC charged six companies with taking hundreds — sometimes thousands — of dollars for mortgage modifications, and then leaving homeowners worse off. According to the complaints, some companies pretended to be associated with the government; others guaranteed that they could get loan modifications regardless of the circumstances. The FTC's actions are part of a joint federal and state enforcement sweep, Operation Mis-Modification. The Consumer Financial Protection Bureau brought charges against three other mortgage relief operations, and state agencies announced 32 similar actions. Since 2008, the FTC has brought 48 lawsuits against companies peddling fraudulent mortgage relief schemes.

Saying Scram to Cram Scams

At the request of the FTC, a federal court temporarily halted a scheme that crammed more than $100 million in charges on people's mobile phone bills without their permission. In its complaint, the FTC seeks to shut down the operation permanently and recover money consumers lost. The defendants allegedly used deceptive practices, including websites with bogus offers of "freebies" or gift cards, to trick people into providing their mobile phone numbers. In addition to law enforcement, the agency is using consumer education and policy discussions to combat mobile cramming. The agency recently released a new report with five recommendations for the industry and testified before Congress about the problem.

Getting Your Money Back

When possible, the FTC provides refunds to people affected by unfair or deceptive business practices. This month, the FTC sent checks totaling $9.3 million to nearly 200,000 people who bought Ab Circle Pro. The marketers allegedly claimed that exercising on the device for just three minutes a day would cause users to lose 10 pounds in two weeks. The FTC also sent refund checks totaling more than $16 million to 18,000 people who paid American Tax Relief to reduce their tax debts. In a separate case, $800,000 was returned to some 1,300 consumers who fell prey to mortgage relief scams.

Barred from Collusion

Two internet resellers of UPC barcodes, used by retailers for price scanning and inventory purposes, have settled charges that they acted illegally by inviting competitors to join in a collusive scheme to raise the prices of barcodes sold online. The FTC charged executives from InstantUPCCodes.com and Nationwide Barcode with exchanging email messages proposing that the two companies — along with a third barcode seller — together raise their prices. The allegedly improper discussions stopped only after the FTC started its investigation.

"As mobile apps become more central to the shopping experience, it's important that consumers have meaningful information about how those apps work before they download them. Consumers should not be left in the dark about their potential liability for erroneous or unauthorized charges or about the way shopping apps handle their data."

— Jessica Rich, Director, Bureau of Consumer Protection

Don't Take Them at Face Value

TicketNetwork — the third largest online exchange for event tickets in the U.S. — and two of its sales partners have agreed to settle allegations brought by the FTC and the State of Connecticut that they misled consumers. According to the complaint, the defendants' websites and advertisements led people to believe they were buying event tickets from the original venue at face value. Instead, they were getting resale tickets and often paying more than the venue's original price.

A Shot of Double Talk

To settle FTC charges, the Quebec-based marketers of "fat burning" and "calorie blocking" diet pills will pay $500,000 for making allegedly deceptive weight loss claims. According to the FTC, the defendants called themselves "Freedom Center Against Obesity" and claimed that their Double Shot pills would cause rapid, substantial and permanent weight loss — without diet or exercise. But they didn't have any research to back up these claims.

Tech Support Scammers Ordered to Pay Up

A U.S. District Court recently ordered the operators of several international tech support scams to pay more than $5.1 million for convincing people that their computers were riddled with viruses and then charging for bogus support services. The operations were mostly based in India and targeted English-speaking consumers in the United States and several other countries.