FTC Sues Infomercial Maker to Collect Consumer Redress

The Federal Trade Commission has asked a U.S. District Court to impose civil penalties on two defendants who have failed to obey an FTC order requiring them to pay $500,000 in consumer redress.

Jeffery Salberg was one of nine marketers of self-help and health-related products promoted in radio and television infomercials who settled FTC charges earlier this year that ad claims for their products were false or unsubstantiated. The settlement barred Salberg and his company, Mega Systems International, Inc., from making deceptive claims relating to their products; required substantiation for claims about the benefits, performance or efficacy of products or programs they advertise, promote, sell, or distribute in the future; barred misrepresentations about the existence, contents, validity, results, conclusions or interpretations of any test, study or research; and required that future radio and television infomercials carry disclosure messages stating that the program was actually paid advertising. In addition, the settlement called for Salberg and Mega Systems to pay $500,000 in consumer redress by July 10, 1998.

"We take Commission orders seriously," said Jodie Bernstein, Director of the FTC's Bureau of Consumer Protection. "We intend to enforce them."

The FTC asked the court to issue a preliminary injunction freezing the defendants' assets, and to order them to pay the $500,000 in consumer redress, interest for the period since July 10, and civil penalties for violating the FTC's order.

Mega Systems is based in Lansing, Illinois.

The Commission vote to file the complaint was 4-0. It was filed in United States District Court for the Northern District of Illinois, Eastern Division.

NOTE: The Commission files a complaint when it has "reason to believe" that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. The case will be decided by the court.

Copies of the complaint and other documents associated with this case 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; 202-FTC-HELP (202-382-4357); TDD 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 File No. C-3811)
(Civil Action Number 98C 8009)