Marketer of Software Display-rack Distributorships to Pay Redress under Settlement of FTC Fraud Charges

William B. Chappie, the remaining defendant named in a Federal Trade Commission case involving marketers of software display-rack distributorships, has agreed to pay $70,000 for consumer redress and to be permanently banned from selling or assisting others to sell any business venture in the future. The settlement stems from charges the FTC filed against Infinity Multimedia, Inc., Quality Marketing Associates, Inc., William B. Chappie and Joseph Anthony Wentz. The FTC had alleged that, in the course of selling their pre-packaged businesses for between $8,000 and $80,000 for a distributorship, the defendants made false earnings and success claims, had one of their employees pose as an independent reference for potential investors to call, and used a variety of other deceptive practices.

In June 1996, the FTC filed its complaint in federal district court, alleging that the defendants, all of Pompano Beach, Florida, misrepresented the earnings potential of their business ventures, the authenticity of their references, and their ability to find profitable locations for purchasers' display racks. (In September 1996, defendants Infinity Multimedia, Inc., Quality Marketing Associates, Inc., and Joseph Anthony Wentz reached a settlement.)

The consent judgment negotiated by the FTC requires the court's approval to become binding. Specifically, the proposed settlement announced today would:

• permanently ban Chappie from participating in any way in the marketing, promotion or sale of any franchise or business venture;

• require Chappie to pay $70,000 to the FTC for consumer redress;

• prohibit Chappie from providing customer lists to others; and

• prohibit him from using aliases.

The FTC filed the proposed consent judgment in this case in the U.S. District Court for the Southern District of Florida, Fort Lauderdale Division. The Commission vote to authorize filing of the proposed settlement was 4-0. The FTC's Denver Regional Office handled the investigation.

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

Copies of the new release, the proposed consent judgment, and other documents associated with this case are available from the FTC's Consumer Response Center, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-FTC-HELP (202-382-4357); TDD for the hearing impaired 1-866-653-4261. Copies of the news releases and other materials also are available on the Internet at the FTC's World Wide Web site at: http://www.ftc.gov To find out the latest news as it is announced, call the FTC News Phone recording at 202-326-2710.

(FTC Matter No. X960073)
(Civil Action No. 96-6671-CIV-Gonzalez)