Source: Bigstock
On July 3rd a federal district court granted the FTC’s request to stop a group of San Diego-based Internet marketers, including Triangle Media Corporation, from deceptively advertising free trial offers and charging consumers for the trial product while also enrolling them in ongoing continuity plans without their knowledge or consent. The court temporarily halted the company’s operations, froze its assets, and appointed a temporary receiver over the businesses.
When consumers clicked on ads for Triangle’s products, they landed on websites promoting “risk-free” trials. The order flow and payment page suggested that consumers just had to pay the cost of shipping, which was typically $4.95. Whereas the shipping costs were presented in bold, black text that was highlighted in yellow, the other aspects of the offer were presented in a small gray-on-white disclosure at the bottom of the page: “By placing an order you will be enrolled in our membership program. This program will charge $4.95 today and $84.71 for your trial full-size product on the 15th day if you do not call to cancel the membership. You will receive a full-size bottle of the product for $84.71 (S&H included) every 30 days thereafter until you cancel.” Consumers who ordered on their phones had to click on another hyperlink to be taken to that disclosure. If you look below you can see that hilariously small and hard to read disclosure.
Source: FTC
The FTC’s press release thanked a number of agencies who apparently collaborated with the FTC: the United States Postal Inspection Service, the Nevada Attorney General’s Office, the San Diego County District Attorney’s Office, the Better Business Bureau of Eastern & Southwest Missouri & Southern Illinois, the Better Business Bureau of Denver & Boulder, the Better Business Bureau of Detroit & Eastern Michigan and the Better Business Bureau of Southern Nevada. Clearly, this was a group effort!
Takeaway:
I assume none of you would be using such nefarious tactics but keep in mind that free to pay and risk-free trials are heavily regulated and it is important to ensure that your advertising practices comply with state and federal laws. And, keep in mind that CA has a new law that just went into effect on July 1, 2018.
