FTC Charges Online Marketing Scheme with Deceiving Shoppers
The defendants' websites, TV infomercials, and emails deceived consumers by prominently claiming that their products and services were free
The Federal Trade Commission (FTC) has charged a group of online marketers with deceptively luring consumers with "free" and "risk-free" trials for cooking gadgets, golf equipment, and access to related online subscription services.
According to the FTC, the defendants asked people for their credit card information to cover shipping and handling, and then charged them for products and services without their consent. The FTC's complaint alleges that Brian Bernheim, Joshua Bernheim, Jared Coates, Robert Koch AAFE Products Corp., JBE International LLC, BSDC Inc., KADC Inc., Purestrike Inc., and BNRI Corp., formerly known as Bernheim and Rice Inc., violated the FTC Act and the Restore Online Shoppers' Confidence Act.
According to the complaint, the defendants' websites, TV infomercials, and emails deceived consumers by prominently claiming that their products and services were free—without clearly disclosing that they would start charging consumers if they did not cancel their "free trial" or return the "free" products. They also misrepresented their return, refund, and cancellation policies. Specifically, they buried these terms in pages of fine print that people could reach only through a tiny hyperlink.
During the purchase process, the defendants signed consumers up for more "free" trials after forcing them to click through as many as 14 upsell pages to reach a final confirmation page, according to the FTC's complaint. Many of those pages included poorly disclosed, or undisclosed, additional "free trials" that resulted in yet more unauthorized charges.
The defendants marketed their products under various company names including Kitchen Advance, Gourmet Cooking Online, Gourmet Cooking Rewards, Medicus Golf, Kick X Tour Z Golf Balls, Golf Online Academy, Golf Tour Partners, and Purestrike Swing Clinic.