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It billed itself as “Facebook and Myspace for kids,” but according to a settlement with the FTC, the Skid-e-Kids website failed to meet critical compliance obligations under COPPA, the Children’s Online Privacy Protection Act. As a result, the FTC says the site collected personal information from about 5,600 kids without their parents’ consent. Under COPPA and the FTC’s COPPA Rule, website operators like Skid-e-Kids have to notify parents and get...

In celebration of Halloween — and with apologies to Edgar Allen Poe — here’s our take on what companies can do to make sure spooky business practices don’t come back to haunt them. Once upon a midnight lawful Pondering practices, good and awful, Reading through the U.S. Code For dos and don’ts I parse and claw. I came upon the Trade Commission’s Section 5 with all revisions. “Tell the truth”: Its admonition. It’s no defense to hem and haw...

Between the picture of the President and Vice-President standing in front of the American flag and the references to government funds to stabilize the economy, it’s understandable that people who signed up for the service advertised on the Grant Connect website thought they were on their way to landing a grant. Promoters even described Grant Connect as “a unique, consumer-friendly US government grant program that delivers all of the tools for the...

It’s unusual for an FTC court document to come with a warning label, but the allegations contained in a recent debt collection case against an outfit doing business as Rumson, Bolling & Associates aren’t for the faint of heart. According to the FTC, the defendants harassed debtors with abusive and profane language, including threats to harm their family members, kill their pets, and desecrate the bodies of their deceased loved ones. And that’s...

FTC watchers will remember Phillip A. Flora. In the first case of its kind, the FTC alleged that Mr. Flora was a One-Man Message Machine, churning out a “mind-boggling” number of unsolicited commercial text messages pitching mortgage modification services. How many did he send? According to the FTC, millions and millions . Problem #1: The FTC charged that sending the unsolicited messages (or causing them to...

The FTC’s settlement with Reebok requires the company to get their ad claims in shape and works out a $25 million refund program for people who bought EasyTone and RunTone shoes and apparel. Of course, the terms of the lawsuit apply only to Reebok, but experienced advertisers understand the benefits of mining FTC orders for compliance nuggets applicable to their business. What if you sell Reebok shoes or apparel or represent companies that do...

Shape up your substantiation or tone down your ads. That’s the message marketers should take from the FTC’s $25 million settlement with Reebok for false and unsubstantiated claims for the company’s EasyTone and RunTone toning shoes. Fitness freaks and couch potatoes alike have noticed the toning shoe trend. Reebok kicked off its EasyTone walking shoes line in early 2009. RunTone running shoes followed in 2010. Retailing for about $100, the shoes...

If necessity is the mother of invention, bogus invention promotion companies are the sketchy brothers-in-law. That’s why inventors who think they may have that Next Big Thing should investigate thoroughly before signing on with a firm that promises to evaluate, patent, and market an innovation. Some make pie-in-the-sky promises, but serve up crumbs. Unscrupulous promoters try to take advantage of inventors’ enthusiasm by overstating the benefits...

Here’s how AcneApp and Acne Pwner were supposed to work. Buyers downloaded the apps from their favorite app store. After selecting a light — blue to fight bacteria or red to heal, some ads said — they rested their smartphone against their skin. “Kill ACNE with this simple, yet powerful tool,” promised the marketer of Acne Pwner. (No, that’s not a typo. For readers old enough to remember when phones had curly cords, gamers use “pwn” to mean to...

“You can settle your credit card debt for pennies on the dollar without filing for bankruptcy.” For people struggling to stay afloat, Debt Relief USA’s national TV ads must have seemed like a lifeline. When consumers called the company, representatives assured them that low monthly payments to Debt Relief USA would cover both the settlement of their reduced debts and the company’s fees. For the service to work, said the reps, people had to stop...