Consumer Alert
Joining forces to help stop scam calls
By
Rosario Mendez
Attorney and Consumer Education Specialist, FTC
July 18, 2023
Image
Nobody likes getting bombarded with robocalls. Not only are they annoying, but they’re often pushing scams for things like fake auto warranties and credit card debt relief programs. The FTC and law enforcement agencies from all 50 states are taking action to stop them. And you can help, too.
Today, the FTC and its federal and state law enforcement partners announced Operation Stop Scam Calls, the latest joint effort in the fight against illegal robocalls. Today’s announcement outlines the enforcement actions to stop multiple dishonest telemarketers, the companies that hire them, and Voice over Internet Protocol (VoIP) service providers that supply the technology for telemarketers to make millions of scammy robocalls.
Here’s how you can help:
- Know your rights. A robocall trying to sell you something is illegal unless the company has your written permission to call you that way. Read the article Robocalls for more.
- Spot the scams that use illegal robocalls. Many illegal robocalls lead to scams. They might try to convince you the call is from the government, tech support, or your auto warranty company, but it’s not. It’s a scam. Listen to some examples of robocall scams.
- Hang up on phone scams. Some scammers will call you and say you won a prize but you have to pay to get it. (Don’t. It’s a scam.) Or the scammer may say that you’ll be arrested for money you owe and that you have to pay immediately. (That’s also a scam.) Hang up or delete the voicemail. Don’t press any number or call back. For more advice, read Phone Scams.
- Report scams and illegal robocalls. Reporting helps law enforcement and investigators stop scams and illegal robocalls. Report scams at ReportFraud.ftc.gov and report illegal robocalls at DoNotCall.gov.
For more advice on how to stop unwanted calls, check out ftc.gov/calls.
Topics
Scams
_______________________________________________________________
Business Blog
FTC challenges deceptive claims and “selfie” news and reviews for alcohol treatment product
By
Lesley Fair
July 19, 2023
For the millions of Americans struggling to reduce their alcohol intake or stop drinking altogether, a product called Sobrenix sounded like the answer. But according to the FTC, defendants Rejuvica LLC and corporate officers Kyle Armstrong and Kyle Dilger made numerous unsubstantiated representations and falsely claimed to have clinical proof that didn’t really exist, in violation of both the Opioid Addiction Recovery Fraud Prevention Act and the FTC Act. What’s more, the complaint alleges they made deceptive use of endorsements – both by having paid endorsers make TV appearances designed to look like independent news stories, but that were actually paid advertising and by creating a phony “review” website. The proposed settlement includes a financial remedy that will return money to consumers.
Image
Containing a blend of kudzu root, milk thistle seed, angelica root, and other herbs and vitamins, a two-ounce supply of Sobrenix sold for about $34 on the company’s website and through Amazon and Walmart. The label directed people to take Sobrenix once in the morning “and then 30 minutes before drinking, or any time you have cravings.”
Controlling cravings was a key part of the defendants’ marketing strategy and Rejuvica pitched Sobrenix as a solution: “STRUGGLING TO CONTROL YOUR ALCOHOL CONSUMPTION? Sobrenix is designed to reduce alcohol cravings and help you detoxify your body so you can successfully manage alcohol consumption. Even better, taken before drinking, Sobrenix’s ingredients help you stop before you’ve had too much.”
Claiming their product would “STOP Cravings In Their Tracks,” the defendants touted Sobrenix as “the safe, healthy all-natural option” that would help people “get a handle on their alcohol consumption or quit altogether without turning their lives upside down . . . .”
Consumers also may have seen appearances on local news programs by alternative health “expert” Bryce Wylde and nutritionist Jonny Bowden, who Rejuvica paid for their appearances. As Wylde claimed, according to “a double-blinded, placebo-controlled Harvard trial, so this is legit stuff, two pools, students, college students . . . . One group got water, the other group got this stuff [pointing to Sobrenix bottle]. The group that was active, that got this kudzu ingredient, they drank half as much at free will, half as much.” On another program, Bowden similarly touted the ability of Sobrenix to reduce the desire to drink alcohol and also claimed Sobrenix had been found effective in a Harvard study.
The company then highlighted excerpts from those TV appearances online and in social media. For example, Rejuvica stated on its website, “Sobrenix was recently featured on KATU & CITY TV. Our product was recognized by health experts Jonny Bowden & Bryce Wylde as a product to help reduce and control cravings. We are so excited to share this video with you!”
In addition, a website called AlcoholSupportSupplements.com claimed to review multiple alcohol support supplements and named Sobrenix the “clear winner,” scoring 94% out of 100%.
So what was really going on with the marketing of Sobrenix? According to the complaint, the defendants didn’t have substantiation for their claims that the product reduces or eliminates alcohol cravings, enables people to substantially reduce or eliminate alcohol consumption, helps them regain control of problem drinking, and treats alcohol use disorder. What about the representation that Sobrenix’s effectiveness was supported by clinical evidence? The FTC alleges those statements were false.
The FTC also says the defendants conveyed to consumers that what Wylde and Bowden said about Sobrenix on those TV news programs were independent opinions by impartial experts. In fact, their statements were – with the defendants’ full cooperation – bought and paid for through the company’s public relations firm. According to the complaint, Rejuvica’s Director of Marketing candidly described one of Wylde’s appearances as “basically a Sobrenix commercial.” Once Wylde and Bowden appeared on those programs, Rejuvica’s PR firm suggested the defendants could “amplify” the paid-for placements by treating them “like it was a pleasant surprise to be included in a segment on the power of plants and cravings” – a tactic the defendants implemented by featuring excerpts on their website and in social media.
And the website that claimed to “review” Sobrenix so favorably? The complaint charges that it and similar ones promoting other products sold by the company were simply Rejuvica-written ads deceptively masquerading as the independent opinion of qualified experts.
The proposed order puts injunctive provisions in place to protect consumers from unsubstantiated health-related claims. The order also prohibits the defendants from misrepresenting that claims are clinically or scientifically proven and from misrepresenting the results of scientific tests or studies. In addition, the defendants must disclose when endorsements have been paid for, can’t portray ads as legitimate news coverage, and can’t misrepresent the independence or expertise of any entity or person who reviews a product. Based on the defendants’ financial condition, a portion of the $3.24 million judgment will be suspended. The $650,000 the defendants must pay will be used to provide refunds for consumers.
What can other companies take from the case?
OARFPA makes a wide variety of deceptive practices illegal. Under the Opioid Addiction Recovery Fraud Prevention Act, it’s “unlawful to engage in an unfair or deceptive act or practice with respect to any substance use disorder treatment service or substance use disorder treatment product.” Therefore, companies that market product or services covered by the statute must comply with OARFPA and the FTC Act.
No news is good news? This isn’t the FTC’s first case challenging the deceptive tactic of dressing up advertising in the misleading guise of independent news programming. It’s conduct that advertisers, ad agencies, PR firms, and others in the promotional arena should avoid.
Bogus “selfie” reviews violate Section 5. We may not be fans of duck-lipped close-ups, but the kind of selfie that really raises our hackles are ads that masquerade as independent reviews by experts or consumers.
The FTC has resources for businesses about the use of endorsements, influencers, and reviews.
Tags:
- Consumer Protection
- Bureau of Consumer Protection
- Advertising and Marketing
- Endorsements, Influencers, and Reviews
- Health Claims
- Advertising and Marketing Basics
_______________________________________________________________
Consumer Alert
Is it a legitimate investment opportunity or a scam?
By
Jim Kreidler
Consumer Education Specialist, FTC
July 20, 2023
Image
When you hear about a can’t-miss investment opportunity your first reaction might be to jump right in. Don’t. But how do you tell the difference between a legitimate investment — and a scam?
Investment scams create the impression that you can “make lots of money” with “little to no risk.” They often start on social media, online dating apps, or from an unexpected text, email, or call. This Military Consumer Month we’re talking about ways to avoid investment scams and bogus money-making schemes.
Here’s what to know:
Don’t accept any unsolicited offers. If you get an out-of-the-blue call, text, or email about “an amazing investment opportunity,” it’s a scam. Walk away.
Don’t believe promises that you’ll make money or earn guaranteed returns. No one can guarantee you’ll make lots of money with little to no risk. Anyone who does is a scammer.
Reject the high-pressure pitch. Scammers will often pressure you to act fast, saying that you’ll miss the opportunity if you fail to do so. They try to plant an image in your head of what life will be like when you’re rich. Don’t believe it. Legitimate investments let you take the time you need to investigate before spending any money.
Do your own research. Don’t make any investment until you’ve checked it out and fully understand what you’re investing in, and the terms of the deal. Research the investment and the person offering it. Search online for the name of the company plus “review,” “complaint,” or “scam.”
You may be able to spot a scam, but chances are, you know someone who doesn’t. Sharing what you know could help a family member, colleague, servicemember, or a veteran in your life avoid investment scams. Spotted a scam? Report it at ReportFraud.ftc.gov.
Scams
Money-Making Opportunity ScamsLeave a comment
_______________________________________________________
Business Blog
FTC-HHS joint letter gets to the heart of the risks tracking technologies pose to personal health information
By
Lesley Fair
July 20, 2023
We usually don’t recommend reading other people’s mail, but even if you weren’t one of the approximately 130 companies that received a recent joint letter from the FTC and HHS’ Office for Civil Rights (OCR), anyone in the health arena – hospitals, other HIPAA-covered entities, telehealth providers, health app developers, etc. – should take the letter to heart and consider a privacy and security check-up at their business.
The joint letter alerts recipients to the risks that tracking technologies – including Meta/Facebook pixel and Google Analytics – pose to the privacy and security of consumers’ personal health information. As users interact with websites or mobile apps, technologies are often tracking their online activities and gathering personal data about them. Much of this happens behind the scenes with consumers utterly unaware they’re being tracked and unable to avoid what’s happening.
The nature of the data these technologies are gathering without consumers’ consent – for example, health conditions, diagnoses, medications, and visits to healthcare providers – is uniquely confidential. And impermissible disclosure can lead to identity theft, financial loss, discrimination, stigma, mental anguish, and other injurious consequences.
You’ll want to read the letter for OCR’s perspectives on tracking and personal health information, but here’s a sentence worth highlighting: “HIPAA regulated entities are not permitted to use tracking technologies in a manner that would result in impermissible disclosures of PHI to third parties or any other violations of the HIPAA Rules.” The letter also cites a December 2022 OCR bulletin with an overview about how HIPAA applies to the use of online tracking technologies.
But even if a company isn’t covered by HIPAA, the letter is a reminder that it still has obligations under the FTC Act and the FTC’s Health Breach Notification Rule to protect against the impermissible disclosures of personal health information. Citing recent FTC law enforcement actions against Easy Healthcare, BetterHelp, GoodRx, and Flo Health, the letter establishes that it’s “essential to monitor data flows of health information to third parties via technologies you have integrated into your website or app.” What if you had someone else design your site or app? The compliance buck still stops with you. Furthermore, your company is legally responsible even if you don’t use the data obtained through tracking technologies for marketing purposes.
In addition to underscoring that both agencies are watching developments in this area, the letter ends with this admonition: “To the extent you are using the tracking technologies described in this letter on your website or app, we strongly encourage you to review the laws cited in this letter and take actions to protect the privacy and security of individuals’ health information.”
That’s sound advice for companies that received the joint letter – and for other businesses, too.
Check out more health privacy resources from the FTC.
Tags:
__________________________________________________________
