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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.
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  • 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.
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  • 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.
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  • 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.
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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.

				

			

			
						
					
			

	
		
		

			

				
				
December 3, 2014

				 PaymentsMD, LLC settled FTC charges alleging they misled thousands of consumers who signed up for an online billing portal by failing to adequately inform them that the company would seek highly detailed medical information from pharmacies, medical labs and insurance companies.  The FTC alleges the companies used the sign-up process for a “Patient Portal” — where consumers could view their billing history — as a pathway to deceptively seek consumers’ consent to obtain detailed medical information about the consumers to create patient profiles. FTC 				 			
	
		
		
	


 			




	
		
		

			

				
				
November 20, 2014

				 Consumer Collection Advocates, Corp. agreed to stop operating an advance fee recovery scheme for the duration of the on-going litigation with the FTC. The FTC seeks to permanently stop the operation, which in the past year took close to $1.3 million from consumers, many of them elderly people who had lost money to timeshare resale and precious metal investment frauds.  According to the FTC’s complaint, telemarketers for the company called consumers and falsely guaranteed that, for an up-front fee, typically 20 percent of the amount they lost, the defendants would recover substantial amounts of money for them – 60 percent or more – within 30 to 180 days.  The FTC alleges few, if any, consumers received any money.  FTC				 			
	
		
		
	


 			




	
		
		

			

				
				
November 19, 2014

				 One Technologies group settles with the FTC for running an online scheme that allegedly lured consumers with “free” access to their credit scores and then billed them a recurring fee of nearly $30 dollars for a credit monitoring program they never ordered.  The credit monitoring programs, MyCreditHealth and ScoreSense, were marketed through at least 50 websites, including FreeScore360.com, FreeScoreOnline.com and ScoreSense.com.  According to the FTC, they bought advertising on search engines such as Google and Bing so that ads for their websites appeared near the top of search results when consumers looked for terms such as “free credit report.”  The FTC alleges the defendants failed to clearly disclose that consumers who accessed their credit score through their websites would be enrolled in a credit monitoring program and incur monthly charges until they called the defendants to cancel.  FTC				 			
	
		
		
	


 			




	
		
		

			

				
				
November 17, 2014

				 TRUSTe, Inc., a major provider of privacy certifications for online businesses, has agreed to settle FTC charges that it deceived consumers about its recertification program for company’s privacy practices, as well as perpetuated its misrepresentation as a non-profit entity.  The FTC alleges that from 2006 until January 2013, TRUSTe failed to conduct annual recertifications of companies holding TRUSTe privacy seals in over 1,000 incidences, despite providing information on its website that companies holding TRUSTe Certified Privacy Seals receive recertification every year.  FTC Chairwoman Edith Ramirez said “TRUSTe promised to hold companies accountable for protecting consumer privacy, but it fell short of that pledge.”   FTC				 			
	
		
		
	


 			




	
		
		

			

				
				
November 10, 2014

				 Norm Thompson Outfitters. Inc., and Wacoal America, Inc. agreed to pay to pay $230,000 and $1.3 million, respectively, to settle charges that their marketing claims for their caffeine-infused products were false and not substantiated by scientific evidence.  In settling the charges, the companies are banned from claiming that any garment that contains any drug or cosmetic causes substantial weight or fat loss or a substantial reduction in body size. The companies also are prohibited from making claims that any drug or cosmetic reduces or eliminates cellulite or reduces body fat, unless they are not misleading and can be substantiated by competent and reliable scientific evidence.  FTC				 			
	
		
		
	


 			




	
		
		

			

				
				
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				 			
	
		
		
	


 			


											

						

								

									
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