• The FTC highlighted its ongoing partnership with state and local law enforcement officials in its campaign to combat fraud and stop exploitation of the Hispanic community during the Hispanic Law Enforcement and Outreach Forum in Miami, Florida. There are 55 actions in progress involving a range of products and services, including prize-promotion scams, purported weight-loss supplements, immigration fraud, bogus high school diplomas, and mortgage fraud. The FTC also unveiled a new Spanish-language consumer Web site, www.ftc.gov/espanol, and announced the publication of new Spanish-language consumer education materials on prize promotions and getting credit. Additionally, the FTC and the U.S. Postal Inspection Service are hosting a series of workshops in Hispanic communities across the country to bring local law enforcement and Hispanic community leaders together in the fight against fraud. Workshops have already been held in Chicago and Dallas and are planned for Phoenix and Los Angeles later this year. At the forum in Miami, the FTC also announced the filing of three new complaints. The FTC filed a complaint in California against Del Sol, LLC for an illegal prize scam. The FTC also filed in Texas against Direct-Prom, Inc for targeting Hispanics with deceptive advertisements for weight-loss supplements and in Nevada against Success Vending Group, Inc. for deceptive marketing of vending machine ownership opportunities. The FTC also recently created a new Web site, www.ftc.gov/ojo, for its Spanish-language consumer fraud awareness campaign, “OJO – Mantente alerta contra el fraude. Infmate con la FTC” (“Be on the alert against fraud. Stay alert with the FTC”). In addition to the OJO Web site, the FTC has five Spanish-language “micro sites” on credit, business opportunities and work-at-home scams, identity theft, information security, and diet and fitness. The agency’s objective is to let Spanish speakers know how they can identify and avoid fraudulent and deceptive practices and where they can report them.
  • The FTC and the Department of Health and Human Services (“HHS”) will jointly sponsor a workshop on childhood obesity on July 14 and 15, 2005 in Washington, DC. The workshop will bring together key experts for a discussion on industry self-regulation concerning the marketing of food and beverages to children, as well as initiatives to educate children and parents about nutrition. FTC Chairman Deborah Platt Majoras said, “This workshop will bring together a wide range of voices to examine ways, including self-regulation, to best promote competition among marketers of healthy foods and the dissemination of good information so that consumers can make healthy food choices.” The 1999 – 2002 National Health and Nutrition Examination Survey estimated that 16 percent of children and adolescents ages six to 19 years are overweight. In planning this workshop, the FTC and HHS seek public comment on a variety of issues related to industry self-regulation and childhood obesity. Comments may be submitted at https://secure.commentworks.com/ftc-foodmarketingtokids/.
  • The FTC and 35 government partners from more than 20 countries have launched a campaign to stop spam “zombies”. Spammers use hidden software to hijack consumers’ home computers and route spam emails through them. The hijacked, or “zombie”, computers hide the true origin of the spam. “Operation Spam Zombies” will educate Internet Service Providers about “zombie” computers by sending letters to more than 3,000 ISPs around the world, urging them to employ protective measures to prevent their customers’ computers from being hijacked by spammers. The measures include technological solutions and educating consumers about how to keep their home computers secure. The next phase of the operations will be to directly locate the zombies and the networks hosting them. The FTC has created a webpage www.ftc.gov/bcp/conline/ edcams/spam/zombie/index.htm, which includes a summary of the project, the letter that the FTC and its partners are sending to ISPs, and a list of participating agencies from around the world. The partners will also post translations of the ISP letter and other updates concerning this project on this Web site.
  • On May 4, the FTC’s Associate Director for Planning and Information, Lois C. Greisman, provided the Canadian Parliament with an overview of the FTC’s Telemarketing Sales Rule and Do Not Call Registry provision. A National Do Not Call Registry was launched in the United States in June 2003 and is enforced by both the FTC and the Federal Communications Commission (FCC). The statement to the Parliament noted that the Registry provides consumers with a “meaningful choice” about what calls they receive. The Registry also improves efficiency and effectiveness of telemarketers by allowing them to scrub their call lists of consumers who do not wish to be called. Compliance with the Registry (which contains 92 million numbers) has been high, but the FTC still actively investigates and prosecutes violators. The FTC has brought eleven Do Not Call cases and the FCC has issued sixteen citations.
  • The FTC, in conjunction with the Department of Justice (“DOJ”) and the Department of Education (“ED”), issued its fourth annual report on scholarship fraud to Congress on May 3rd. The report outlines the agencies’ continued efforts to combat scholarship and financial aid fraud and details the nature and quantity of scholarship fraud incidents of the past year. The College Scholarship Fraud Prevention Act of 2000 requires the yearly report and charged the FTC and ED with conducting outreach efforts to educate consumers about scholarship scams. The agencies have created web sites, booklets, and posters and distributed them in English and Spanish. This year’s report notes a sizeable increase in inquires from 2003 but attributes the jump to improved reporting rather than an increase in scholarship fraud. To date the FTC has brought eleven cases against alleged scammers since its “Project Scholarscam” campaign was implemented in 1996.

Authored by:
Camelia Mazard
202-218-0028
cmazard@sheppardmullin.com
and

Case Collard
202-218-6876
ccollard@sheppardmullin.com