Southern California company settles FTC charges of deceptive marketing

The Federal Trade Commission (FTC) in the US has charged a network of online marketers collectively operating as Tarr in Southern California of misleading consumers to buy skincare and dietary products through fake news and magazine sites.

Network members Richard Fowler, Ryan Fowler, and Nathan Martinez were ordered by the court to pay settling charges of $179m, which is the amount that was allegedly paid by consumers over more than five years.

The charges will be suspended if a $6.4m payment is made to the FTC.

According to the commission, the the company sold more than 40 wrinkle reduction, weight loss, and muscle building products with unsubstantiated health claims, as well as deceptive celebrity endorsements and consumer testimonials.

The marketers were said to have used misleading free and risk-free trial offers, which automatically enrolled consumers without consent for negative option auto-ship programmes that had undisclosed additional monthly charges.

They also allegedly used fake media websites and assigned them with domain names that appeared to be legitimate news or magazine sites.

Various versions of the websites were claimed to have been used to conceal the scam from law enforcers, banks, and payment processors.

The court has permanently banned the marketers from the use of any negative option programmes to distribute cosmetics, dietary supplements, food, or drugs sold on a trial or sample basis.

In addition, they have been prohibited to use misleading terms and conditions of any offer and from misrepresenting the benefits or efficacy of products.