Federal Trade Commission

This week, the FTC announced that it reached settlements with a state real estate board and an international online business coaching organization. It also announced that millions of dollars in refunds would be made available following a win at trial against a private website attempting to assist consumers with government services. The conduct ranges from allegedly anticompetitive behaviors in violation of Section 5 of the FTC Act as well as false and deceptive marketing and advertising practices. These stories and more after the jump.

Tuesday, April 5, 2022

Bureau of Competition: Real Estate Competition and Exclusionary Conduct

  • The FTC has approved a final order settling charges with the Louisiana Real Estate Board for allegedly violating Section 5 of the Federal Trade Commission Act. The complaint alleged that the Board’s regulations exceeded the scope of the federal mandate by requiring appraisal fees to equal or exceed the median fees identified in survey reports commissioned and published by the Board. The complaint also alleged that the Board investigated and sanctioned companies that paid fees below the specified levels, and that the 2010 Wall Street Reform and Consumer Protection Act (Dodd-Frank) neither requires nor authorizes the restrictions that the board imposed. Under the order, the Board is forbidden from adopting a fee schedule for appraisal services or taking any other actions that have the effect of raising, stabilizing, or fixing compensation levels for appraisal services. It must also rescind the rule that effectively set minimum fees for real estate appraisals.

Bureau of Consumer Protection: Advertising and Marketing; Online Business Coaching

  • The FTC announced a settlement with My Online Business Education (“MOBE”), a business coaching scheme that allegedly made bogus promises about how much money participants could make. MOBE will be retuning more than $23 million to more than 37,000 consumers who lost money by participating in the alleged scheme. The FTC filed a complaint against MOBE in 2018 for targeting service members, veterans, and older adults through various forms on marketing channels with false claims that its business education program would enable people to start their own online business and earn substantial income with a “proven” 21-step system. Consumers who paid the initial $49 entry fee for the 21-step program were allegedly pressured with numerous sales pitches for membership packages that cost thousands of dollars to continue participating in the program. The money being returned to consumers comes from settlements and judgments that were entered before the United States Supreme Court’s decision in AMG Capital Management v. FTC. As previously reported, the Supreme Court ruled that the Commission lacks authority under Section 13(b) to seek monetary relief in federal court going forward.

Thursday, April 7, 2022

Bureau of Consumer Protection: Deceptive Online Advertising and Marketing

  • The FTC announced a trial win against On Point Global, which allegedly ran hundreds of deceptive websites that mimicked government websites and promised quick and easy government services, such as renewing a driver’s license or eligibility determinations for public benefits like Section 8 housing or food stamps. According to the FTC, consumers submitted payments for what they allegedly believed to be government services but, at most, received a PDF with publicly available information. The FTC alleged that customers who shared sensitive personal information on On Point Global’s website almost immediately started to receive unwanted sales and marketing calls. As a result of the win, On Point Global has made $102 million in refunds available to consumers who were harmed by the alleged schemes.