On December 11, 2023, the Federal Trade Commission announced that it has obtained proposed orders against the operators of a purported wide-ranging scheme known as “The Sales Mentor” that allegedly made millions by falsely promising consumers that they could make big money from telemarketing sales.

According to the FTC, the Defendants agreed to proposed court orders that would require them to pay a total of $1 million for consumer refunds.

In a federal court complaint, the FTC charged the companies, their owners, their officers and a former sales director with deceiving consumers to pay hundreds or even thousands of dollars for supposed telemarketing training programs that rarely, if ever, delivered on what was promised.

In addition, the FTC said the companies continued to make deceptive earnings claims even after they received the FTC’s Notices of Penalty Offenses on money-making opportunities and on endorsements and testimonials warning them that such conduct is unlawful.

On November 21, 2023, the agency announced that a DNA testing firm will pay a $700,000 civil penalty and will be barred from a wide range of deceptive practices to settle charges from the FTC and the California Attorney General that the company deceived users about the accuracy of its DNA reports.

In a joint complaint filed in federal district, the agencies say that in marketing its DNA-based ancestry and information reports, the company deceived consumers about the accuracy of its test reports compared with those of other DNA testing companies, falsely claimed to have patented an algorithm for its genetic matching process, and used fake reviews and testimonials on its websites.

The company also allegedly used “dark patterns” in its online billing process to trick consumers into paying for products they did not want and did not agree to buy, according to the complaint.

On November 16, 2023, the FTC announced that it had taken action against a company for allegedly failing to adequately secure data and notifying consumers after their personal data was breached.

According to the agency, it will require the prison communications provider and two of its subsidiaries to notify consumers of any future data breaches as part of a proposed settlement over charges they failed to secure sensitive data of hundreds of thousands of users stored in a cloud environment, and failed to alert all those affected by the incident.

In a complaint, the FTC says that the company and two of its subsidiaries failed to implement adequate security safeguards to protect personal information they collect from users of its services, which purportedly enabled bad actors to gain access to unencrypted personal information stored in the cloud and used for testing new search software.

On December 4, 2023, the FTC announced that it will hold a virtual information hearing on January 16, 2024 as part of its review of the proposed “Click to Cancel” rulemaking and proposed amendments to the Negative Option Rule.

On March 23, 2023 the FTC announced a rulemaking proposing several significant updates to its rule regarding subscriptions and recurring payments, including a “click to cancel” provision requiring sellers to make it as easy for consumers to cancel their enrollment as it was to sign-up. The new click to cancel provision, along with other proposals, is aimed at protecting consumers from struggles to cancel unwanted subscription payment plans. The hearing will be open to the public and viewable on the FTC’s website.

On December 12, 2023, the FTC announced the finalization of the CARS Rule, designed to fight scams in vehicle shopping. The new rule is intended to fight two common types of illegal tactics consumers face when purchasing a car - bait-and-switch tactics and hidden junk fees.

The Combating Auto Retail Scams Rule also includes protections for members of the military and their families, who the FTC states are targeted not only with bait-and-switch tactics and junk fees, but also deceptive information about whether dealers are affiliated with the military, and other specific issues that affect servicemembers.

Consult with an experienced FTC defense attorney about recent consumer protection regulatory developments and enforcement trends that may impact digital marketers.