Northwest Region

In 1975, the Northwest Region (NWR) pioneered the first use of the FTC’s 13(b) authority to obtain preliminary relief in a fraud case. In Travel King and Psychic Surgery, the Region took action against travel agencies for making false claims about psychic surgery, misrepresenting it as an actual surgical operation to remove diseased tissue from the body using only the bare hands.

In 1996, NWR brought Fortuna Alliance, the FTC’s first major case where the internet was used to perpetrate fraud. The defendants allegedly promised consumers that, for a payment of $250, they would receive profits of over $5,000 per month. The program spawned many websites and victimized thousands of investors across 60 different countries. Although the defendants initially operated out of the U.S., the FTC discovered they had secreted millions of dollars to offshore bank accounts in Antigua. With the aid of the courts and banks in Antigua, the Commission got an order against the defendants, requiring them to repatriate over $2 million in offshore assets and pay approximately $7 million in redress to consumers from 60 countries. To keep consumers around the world updated about the case, the FTC created a website to provide status updates, redress information, and pleadings.

The Northwest Region’s (NWR) Charity Fraud Law Enforcement and Education Initiative had its origins in the 1990s and has become one of the primary national efforts to target charity-related fraud and sham charities, while also educating consumers and businesses about how to donate wisely. The effort includes: bringing 1997’s Operation False Alarm and another nationwide sweep in 2003; bringing the first FTC case with all 50 states as co-plaintiffs; operating a listserv for more than 350 state charity officials from the 50 states, the District of Columbia, Guam, and American Samoa, as well as the FTC, to exchange information about law enforcement and regulatory issues; and hosting the workshop, Give & Take: Consumers, Contributions, and Charity.

The Northwest Region (NWR) was among the first law enforcers to apply FTC law to competition issues related to internet commerce. In 1998, NWR was responsible for Fair Allocation System, one of the first FTC competition cases involving internet sales. The FTC alleged an association of 25 automobile dealerships in five Northwest states planned to boycott Chrysler Corporation if the manufacturer did not agree to restrict the number of vehicles available to competing dealers engaged in low-price internet marketing. The auto dealers formed the association, Fair Allocation System, Inc., to address their concerns. As described in the Analysis to Aid Public Comment accompanying the settlement, “The goal of the boycott was to limit the sales of a car dealer that sells cars at low prices and via a new and innovative channel – the Internet.”

The Regions have been instrumental players in a group of Canadian law enforcement task forces, an initiative to coordinate the law enforcement response to the growing problem of cross-border fraud. For more than 15 years, the Northwest, East Central, and Midwest Regions, with support from the FTC’s Office of International Affairs, have coordinated law enforcement with Canadian counterparts though task forces located in Vancouver, Alberta, Toronto, and Montreal. These efforts have resulted in a host of civil and criminal actions. For instance, the Vancouver taskforce’s work lead to more than 40 extraditions of telemarketers to the U.S. for prosecution and subsequent incarceration.