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Other Federal Enforcement Actions

Numerous federal agencies have authority to institute enforcement proceedings against wrongdoers.  These agencies include:

  • The Department of the Treasury and its divisions including the Financial Crimes Enforcement Network (FINCEN), which is responsible for safeguarding the U.S. financial system from illicit use and money laundering including through enforcement of the Bank Secrecy Act, and the Office of Foreign Assets Control (OFAC), which enforces economic and trade sanctions. Whistleblowers with knowledge of violations of the Bank Secrecy Act can submit a claim under the Anti-Money Laundering Whistleblower Program.  Violations of other laws enforced by the Department of Treasury may give rise to claims under different whistleblower reward programs.
  • The Federal Trade Commission (FTC), which is charged with preventing anticompetitive, deceptive, and unfair business practices. The FTC can bring enforcement actions under U.S. antitrust laws and to stop unfair, deceptive and fraudulent business practices. The FTC does not have any authority to pay financial rewards to whistleblowers; however, conduct that is regulated by the FTC may also give rise to a claim under a different whistleblower reward program.
  • The Consumer Financial Protection Bureau (CFPB), created by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which regulates the offering and provision of consumer financial products or services under the federal consumer financial laws, and has the authority to bring enforcement actions against financial service providers. While the CFPB accepts tips from whistleblowers, and applicable laws offer whistleblowers protection from retaliation, there is currently no provision for CFPB whistleblowers to receive financial rewards. However, conduct that is regulated by the CFPB may also give rise to a claim under a different whistleblower reward program.
  • The Environmental Protection Agency, which enforces federal environmental laws and regulations. The EPA does not currently have any authority to pay financial rewards to whistleblowers; however, conduct that is regulated by the EPA may also give rise to a claim under a different whistleblower reward program, and a number of federal environmental laws protect government or private employees reporting environmental violations under the statutes from retaliation.

Below are summaries of recent settlements and successful enforcement actions involving these agencies. If you believe you have information about fraud which could give rise to a claim under a whistleblower reward program, please contact us to speak with one of our experienced whistleblower attorneys.

November 6, 2014

MPHJ Technology Investments, LLC, and its law firm agreed to settle charges that they used deceptive sales claims and phony legal threats in letters that accused thousands of small businesses around the United States of patent infringement.  According to the FTC,  the company bought patents relating to network computer scanning technology, and then told thousands of small businesses that they were likely infringing the patents and should purchase a license.  In more than 9,000 letters sent under the names of numerous MPHJ subsidiaries falsely represented that many other companies had already agreed to pay thousands of dollars for licenses.  FTC

October 30, 2014

FTC charges Gerber Products Co., also doing business as Nestlé Nutrition, with deceptively advertising that feeding its Good Start Gentle formula to infants with a family history of allergies prevents or reduces the risk that they will develop allergies.  The FTC also alleges that Gerber has falsely advertised Good Start Gentle’s health claims as FDA-approved. The FTC is seeking to prohibit Gerber from making the alleged false and unsubstantiated allergy-prevention claims.  FTC

October 29, 2014

JDI Dating Ltd., an England-based company, and its owner William Mark Thomas, agreed to settle charges alleging the company used fake, computer-generated profiles  to trick users into upgrading to paid memberships and charging these members a recurring monthly fee without their consent.  The settlement prohibits the defendants from misrepresenting material facts about any product or service and requires that, before obtaining consumers’ billing information for a product with a negative-option feature, the defendants clearly disclose the name of the seller or provider, a product description and its cost, the length of any trial period, the fact that charges will continue unless the consumer cancels, the deadline for canceling, and the mechanism to stop recurring charges. The order also requires the defendants to pay $616,165 in redress.  FTC

October 28, 2014

FTC charges AT&T Mobility, LLC with misleading millions of its smartphone customers by charging them for “unlimited” data plans while reducing their data speeds, in some cases by nearly 90 percent.  The FTC’s complaint alleges that the company failed to adequately disclose to its customers on unlimited data plans that, if they reach a certain amount of data use in a given billing cycle, AT&T reduces – or “throttles” – their data speeds to the point that many common mobile phone applications – like web browsing, GPS navigation and watching streaming video –  become difficult or nearly impossible to use.  FTC

October 24, 2014

HealthyLife Sciences, LLC and its former CEO settle charges that they deceived consumers with promises that their Healthe Trim supplements would burn fat, increase metabolism, and suppress appetite and made false and unsubstantiated claims that Healthe Trim supplements would cause rapid and substantial weight loss.   Advertisements for Healthe Trim, which used the tagline “Get High School Skinny,” relied heavily on consumer testimonials that portrayed losing weight as easy.   The settlement bans the former CEO from the weight-loss industry and HealthyLife Sciences is banned from making any of the seven weight-loss claims that the FTC has publicly advised are scientifically infeasible, with respect to any supplement, over-the-counter drug, or any product rubbed into or worn on the skin.  FTC

October 24, 2014

HealthyLife Sciences, LLC and its former CEO settle charges that they deceived consumers with promises that their Healthe Trim supplements would burn fat, increase metabolism, and suppress appetite and made false and unsubstantiated claims that Healthe Trim supplements would cause rapid and substantial weight loss.   Advertisements for Healthe Trim, which used the tagline “Get High School Skinny,” relied heavily on consumer testimonials that portrayed losing weight as easy.   The settlement bans the former CEO from the weight-loss industry and HealthyLife Sciences is banned from making any of the seven weight-loss claims that the FTC has publicly advised are scientifically infeasible, with respect to any supplement, over-the-counter drug, or any product rubbed into or worn on the skin.  FTC

October 23, 2014

A court shut down Centro Natural Corp. and Sumore L.L.C., at the FTC’s request, on allegations that they operate a phantom debt collection operation that deceived and abused thousands of Spanish-speaking consumers across the country in an attempt to collect money they did not even owe.  According to the FTC, the companies bilked consumers out of at least two million dollars by cold-calling consumers and threatening them with harsh consequences, such as arrest, legal actions, and immigration status investigations, if they failed to make large payments on bogus debts.  The defendants’ telemarketers also pressured and deceived consumers into paying for unwanted products by telling consumers it would “settle” their debt.  The FTC is seeking a court order permanently stopping the defendants’ scam.  FTC

March 10, 2014

The FTC has sent more than $2.4 million in refund checks to just over a hundred consumers harmed by the Premier Precious Metals scheme, which bilked millions of dollars from investors, including many senior citizens. The scheme worked by conning consumers into buying precious metals on credit without clearly disclosing significant costs and risks, including the likelihood that consumers would subsequently have to pay more money or lose their investments. FTC
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