Texas Man Who Solicited Payments from Businesses for Unauthorized Ads in Fictitious Publications Settles FTC Charges

A Texas resident who used a variety of assumed names to bilk small businesses nationwide for ad fees in his nonexistent law enforcement publications has settled Federal Trade Commission charges. Clinton Robert Greenwell, doing business as “State Police Magazine,” “The Police Bulletin,” “State Police Enforcers Yearbook,” “State Police Officers Yearbook,” “Firefighters News Journal” and “Creative Publishing,” must obtain a $200,000 performance bond before engaging in or assisting others engaged in the telemarketing of any goods or services, as part of the FTC settlement.

The FTC filed its complaint against Greenwell in May 2003 as part of “Operation Phoney Philanthropy,” a law enforcement and public education campaign by the FTC and state charity regulators to stop fraudulent fundraising. The complaint alleged that Greenwell misrepresented that the businesses authorized him to place their ads in his publications, and they therefore were obligated to pay for the ads. The cost of the advertisements ranged between $150 and $400 each. In addition, the complaint alleged that Greenwell misrepresented that he was a member of, or associated with, a police force or organization. Businesses that fell victim to Greenwell’s scheme by paying once often were targeted a second and third time by the defendant using different aliases and assumed publication names, the FTC alleged.

The Settlement

The settlement announced today prohibits Greenwell from engaging in
misrepresentations in connection with the advertising, promotion, offering for sale, or sale of advertisements to businesses. The settlement specifically prohibits Greenwell from misrepresenting:

• That businesses have authorized advertising to be placed in his publications and
  are obligated to pay for the ads;
  
  
• That he is a member of, or associated with, a police force or law enforcement
  organization; and
  
  
• Any fact material to a consumer’s decision to purchase advertising.

The settlement requires Greenwell to obtain a $200,000 performance bond before engaging in, or assisting others engaged in, the telemarketing of any goods or services. The settlement contains a $200,000 suspended judgment against Greenwell which becomes due in full if it is found that he made material misrepresentations to the court about his financial condition. Finally, the settlement contains various recordkeeping provisions to assist the FTC in monitoring the defendant’s compliance.

The Commission vote authorizing staff to file the stipulated final judgment was 5-0. The judgment was approved by the U.S. District Court for the Southern District of Texas, Houston Division, and entered on October 24, 2003.

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

Copies of the stipulated final judgment are available from the FTC’s Web site at http://www.ftc.gov and also from the FTC’s Consumer Response Center, Room 130, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for the consumer to prevent fraudulent, deceptive, and unfair business practices in the marketplace and to provide information to help consumers spot, stop, and avoid them. To file a complaint, or to get free information on any of 150 consumer topics, call toll-free, 1-877-FTC-HELP (1 877-382-4357), or use the complaint form at http://www.ftc.gov. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to hundreds of civil and criminal law enforcement agencies in the U.S. and abroad.