Last week, the FTC issued its first settlement with a consumer charged with making misrepresentations in a product or service testimonial.
Specifically, the complaint charged Russell Dalbey, the CEO and founder of the company behind the “wealth-building” program “Winning in the Cash Flow Business,” with defrauding consumers, with false claims that they could make large amounts of money quickly and easily by finding, brokering, and earning commissions on seller-financed promissory notes. The complaint named as defendants Dalbey and various corporate entities – - as well as Marsha Kellogg, a consumer who provided a testimonial in an infomercial.
Kellogg settled with the FTC concerning charges that she falsely claimed in infomercials that she earned almost $80,000 from one promissory note transaction using Dalbey’s program and that her total earnings were over $134,000. The complaint alleged that Kellogg earned $50,000 less than what she claimed.
The Colorado Attorney General joined the FTC in prosecuting the case. The complaint alleged that the defendants’ actions violated Section 5 of the FTC Act, the Telemarketing Sales Rule, and the Colorado Consumer Protection Act.
FTC Doesn’t Buy Misleading Infomercial Testimonial « Internetine TV 12:57 pm on June 8, 2011 Permalink
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