In a March 7, 2013 press release, the FTC announced it filed eight complaints in courts around the U.S. against marketers that “allegedly bombarded consumers with hundreds of millions of unwanted spam text messages in an effort to steer them towards deceptive websites falsely promising free gift cards.” The 29 defendants allegedly sent more than 180 million unwanted text messages to consumers, many of whom had to pay for getting the texts.
The messages promised free gifts or prizes, including $1,000 gift cards to major retailers such as Best Buy, Walmart, and Target. Consumers who clicked on the links were required to provide personal identifying information, apply for credit, or pay to subscribe to services to get the “free” cards. Once they entered their personal information, they were told to go to another site and told they would have to participate in a number of “offers,” as many as 13, to be eligible for their gift card. Eventually, after the consumer participated in all of the offers, they were told that to get the promised gift card, they had to find three other people who would also complete the offers.
The Acting Director of the FTC’s Bureau of Consumer Protection, said, “Today’s announcement says ‘game over’ to the major league scam artists behind millions of spam texts. The FTC is committed to rooting out this deception and stopping it. For consumers who find spam texts on their phones, delete them, immediately. The offers are, in a word, garbage.”
The 29 defendants include those who sent the unwanted text messages, as well as those who operated the deceptive websites. The FTC is also filing a contempt action against a serial text message spammer, Phil Flora, who was prohibited in 2011 from sending spam text messages and who is accused of being part of the current text message scheme. The FTC is seeking restraining orders against the defendants to stop them from continuing their alleged unfair practices and to preserve and account for their assets.
To see the names of the companies named in the complaint and to learn more about the case, go to http://www.ftc.gov/opa/2013/03/textmessages.shtm.
The FTC files a complaint when it has “reason to believe” that the law has been or is being violated. The complaint is not a finding or ruling that the defendant has actually violated the law. The cases will be decided by the court.
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