FTC Enforcement

February 14, 2024

A merchant cash advance operator who was found guilty of deceiving small businesses has been ordered to pay $20.3 million in civil penalties and monetary relief.  Jonathan Braun was convicted of misrepresenting the terms of merchant cash advances his business provided, using unfair collection practices, and threatening consumers with physical violence to get them to pay up.  FTC

February 9, 2024

Simple Health Plans LLC and CEO Steven J. Dorfman have been ordered to pay $195 million for violating the FTC Act and Telemarketing Sales Rule and misleading consumers into believing they were signing up for healthcare plans that covered a wide array of services.  Despite  paying as much as $500 per month for benefits, consumers were essentially uninsured and exposed to limitless medical expenses.  FTC

October 18, 2023

For-profit Sollers College, its parent company, Sollers Inc., and its founder and president Siba Padhi have been ordered to cancel $3.4 million in student debt and pay $1.2 million in civil penalties for misrepresenting its job placements rates and relationships with prominent companies in order to lure students to the school.  Since 2018, Sollers claimed that 90% of its graduates were placed in jobs within 3 months of graduation, when in reality the number was as low as 52%.  Sollers also encouraged students into paying tuition with illegal income-sharing agreements, wherein students would pay the school a fixed percentage of their future income for about two years.  Nearly 400 students nationwide were affected by this misconduct, with more than 60 of them being residents of New Jersey.  NJ AG; FTC

October 12, 2023

Trans Union LLC and its subsidiary, TransUnion Rental Screening Solutions, Inc. (TURSS), have agreed to pay $15 million to settle charges of violating the Fair Credit Reporting Act (FCRA) by failing to ensure the accuracy of information included in tenant background screening reports, thus hampering the ability of consumers to obtain housing.  Some of the failures included reporting developments in the same eviction proceeding as if they were from more than one eviction, mischaracterizing the nature of certain information, and failing to accurately report eviction outcomes.  CFPB; FTC

October 6, 2023

Two groups of student loan debt relief scammers—SL Finance LLC and owners Michael and Christian Castillo, along with BCO Consulting Services and SLA Consulting Services Inc and owners Gianni Olilang, Brandon Clores, Kishan Bhakta, and Allan Radam—have been ordered to pay a partially suspended $5.8 million each and be permanently banned from the industry.  The defendants pretended to be affiliated with the Department of Education and used their fake position to charge students millions in junk fees through nonexistent loan repayment and forgiveness programs.  FTC

September 11, 2023

Background report providers Truthfinder and Instant Checkmate have been ordered to pay $5.8 million to settle charges of violating the Fair Credit Reporting Act by failing to ensure the maximum possible accuracy of their reports.  The companies were found to falsely describe certain records as criminal when in fact they were traffic tickets.  When consumers flagged information as inaccurate, the companies never investigated the information flagged, modified the reports, nor noted in reports that information had been flagged by others.  FTC

August 28, 2023

Roomster and owners John Shriber and Roman Zaks have been ordered to pay $36.2 million in monetary judgment and $10.9 million in civil penalties to resolve allegations of charging consumers for access to fake listings for available housing.  Additionally, Roomster was found to have bought tens of thousands of fake reviews which it used to populate the listings.  Per settlement terms, the required payments are suspended upon payment of $1.6 million to New York, California, Colorado, Florida, Illinois, and Massachusetts, which led the investigation along with the FTC.  FTC

July 14, 2023

Online counseling service BetterHelp has been ordered to pay $7.8 million, refrain from disclosing private client health data for advertising purposes, and obtain affirmative consent from clients disclosing such information again, following a settlement with the FTC.  The company was previously found to disclose its clients’ email addresses, IP addresses, and health questionnaire information to various advertisers, in direct contradiction to its promises to clients that such information would be disclosed for select purposes only.  FTC

July 13, 2023

Cryptocurrency platform Celsius Network has been banned from handling consumer assets and ordered to pay a $4.7 billion judgment, suspended pending the return of remaining assets to consumers in ongoing bankruptcy proceedings.  Before filing for bankruptcy in July 2022, Celsius marketed the platform as a safe place to deposit cryptocurrency and made various representations to build consumer confidence, including promises that consumers could withdraw deposits at any time, that deposits were insured by a $750 million policy, that sufficient reserves were on hand, and that deposits could earn as high as 18% APY.  However, all of those claims were all false, and in fact, Celsius misappropriated $4 billion in deposits, using them to fund operations, reward other consumers, and make high-risk investments that often lost money.  FTC; SEC

June 27, 2023

Publishers Clearing House has been ordered to pay $18.5 million and overhaul its sweepstakes entry and sales processes.  The FTC had charged the company with misleading consumers through “dark patterns”—including misleading email subject lines and manipulative website design—to convince consumers to make unnecessary purchases, and to disguise hidden shipping and handling costs on so-called “risk free” purchases.  FTC