Internet Advertiser Settles FTC Charges: Agency's Online Fraud Enforcement Continues

U.S.Telemedia, a firm that marketed computer chips online, has settled Federal Trade Commission charges that its marketing was deceptive and that it violated the Mail and Telephone Order Merchandise Rule. The agency charged that U.S. Telemedia, Inc., an Illinois corporation that advertised over the Internet, and Robert Brandzel, its principal officer, failed to deliver merchandise in a timely manner and failed to provide refunds to consumers who either did not get the chips they ordered or did not get them in a timely manner. To settle the FTC charges, U.S. Telemedia will pay $5500 in consumer redress and be barred from future violations of the rule.

The FTC’s complaint filed in U.S. District Court in March charged that U.S.Telemedia’s advertising urged consumers to telephone or send e-mail messages describing the specifications of the computer chips they wanted and their "target price." When consumers contacted U.S.Telemedia, they were told that they would have to make advance payment by cashier’s check or money order before their order could be shipped. In some cases, U.S.Telemedia told consumers that they would not ship the order until after the consumer’s check had cleared, which they said may take up to ten days. In fact, the FTC alleged, consumers who paid for the chips they ordered did not receive them within the times represented and did not receive a refund of their payment upon request. "In most instances consumers did not receive the ordered items at all," the complaint says. The court issued a temporary restraining order and an asset freeze in response to the FTC complaint.

The case against U.S.Telemedia was announced as part of a continuing crackdown on deceptive marketing in cyberspace that has targeted a range of phony schemes including credit repair ripoffs, bogus income opportunities, and a phony grant assistance operation. The FTC has brought over a dozen cases against on-line scammers.

To settle the FTC charges, Brandzel and U.S.Telemedia will pay $5500 in consumer redress and will be barred from misrepresenting the merchandise or the shipping schedule for its items and from any other violations of the Mail and Telephone Order Rule. In addition, Brandzel would be required to notify the FTC if he establishes any World Wide Web site.

NOTE: This consent judgement is for settlement purposes only and does not constitute an admission by the defendant of a law violation. Consent decrees/judgments have the force of law when signed by the judge.

Copies of the complaint and consent order are available from the FTC’s Public Reference Branch, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-2222; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710. FTC news releases and other materials also are available on the Internet at the FTC’s World Wide Web site at: http://www.ftc.gov

(FTC File No. X960 051)
(Civil Action No. 96C 1440)