Cleaning Supply Sellers Agree to Settle FTC Contempt Charges

Dennis J. Saccurato and his businesses, Sparta Chem, Inc. and Compu-Kleen Inc. of Elmwood Park, have agreed to a settlement with the Federal Trade Commission in which, among other things, they admit that they are in contempt for violating a court order barring them from making fraudulent representations to induce sales of cleaning supplies and shipping and billing for supplies that businesses didn’t order.

In 1996, the FTC charged the defendants with telemarketing fraud. Among other things, the FTC alleged that they made false and misleading representations to get product orders or to obtain information they used later to claim that merchandise was ordered, then shipped merchandise at inflated prices and charged fees that consumers hadn’t authorized. A court settlement required them to comply with the Telemarketing Sales Rule and barred them from further abusive practices. The proposed settlement announced today resolves contempt charges filed by the FTC against the defendants in 2007, in which they were charged with violating the terms of the settlement.

Under the proposed settlement, the defendants, all based in New Jersey, must, for eight years, digitally record all telephone calls to or from any and all customers in their entirety and preserve the recordings. They also must promptly transmit intelligible copies of all such recordings to the FTC upon request, and to customers upon their request.

The settlement also bars the defendants from threatening to refer a charge to a collection agency unless, two weeks beforehand, they provide the customer with recordings of all calls that have taken place between them and the customer regarding the charge. In addition, the settlement requires them to accept all unopened merchandise that’s returned within 90 days of a customer’s receipt of a product or invoice, whichever is later, and it bars them from imposing any costs or fees for such returns.

The settlement includes a $2.3 million judgment, which is suspended based on the defendants’ inability to pay. The full judgment will be imposed if they’re found to have misrepresented their financial condition. The settlement also imposes record-keeping provisions to allow the FTC to monitor compliance with its order.

By a 4-0 vote, the Commission approved the filing of the supplemental stipulated order in the U.S. District Court for the District of New Jersey.

NOTE: This stipulated final order is for settlement purposes only. A stipulated final order requires approval by the court and has the force of law when signed by the judge.

Copies of the order are available from the FTC’s Web site at http://www.ftc.gov and 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 in English or Spanish 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/ftc/complaint.shtm. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to more than 1,600 civil and criminal law enforcement agencies in the U.S. and abroad.

(Sparta Chem)
(FTC File No. X960071)