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Posts about Businesses in hot water

Marketer banned from sending texts

Posted by: James Eli Shiffer Updated: February 10, 2014 - 6:26 PM

By Alejandra Matos

A Wisconsin marketer was permanently banned from sending unsolicited text messages to consumers after he sent millions of texts to people promising free gift cards and electronics, the Federal Trade Commission announced last week.

Jason Q. Cruz of West Bend, Wis., allegedly sent the text messages promising free iPads or $1,000 gift cards from major retailers, the FTC said.

Those who clicked on the links were taken to a website that requested their personal information and required them to sign up for multiple “risky” trial offers for “questionable products and services” that cost money or included recurring monthly charges, the FTC said.

The FTC sued Cruz in March, and the ban on future texts settles that lawsuit.

$56K awarded to fired worker who complained about racist images

Posted by: Alejandra Matos Updated: February 5, 2014 - 5:58 PM

An African-American restaurant worker who lost his job after complaining about racist images in his workplace was awarded $56,000 by a federal court in western Wisconsin. 

In 2010, Dion Miller arrived for his scheduled shift at Sparx Restaurant in Menomonie, Wis., and found a picture of black actor Gary Coleman taped to a cooler, along with a dollar bill with a noose around the neck of a black-faced George Washington. There were also swastikas and the image of a man in a Ku Klux Klan hood. 

Miller complained to several managers and was told the images had been posted by the managers themselves the night before as a “joke.” Less than a month later, Miller was fired for having “a bad attitude,” according to the complaint, filed on his behalf by the U.S. Equal Employment Opportunity Commission (EEOC).

In September 2013, a jury found Miller was fired with malice or reckless disregard of his federally protected rights. The jury awarded him $15,000 for emotional distress, and last week, U.S. District Judge Barbara B. Crabb ordered that the restaurant’s owner, Northern Star Hospitality, pay Miller an additional $41,000 in back wages and interest. 

“Anti-discrimination efforts would come to a standstill if employees weren’t allowed to freely complain about racist and discriminatory conduct,” said John Hendrickson, regional attorney for the EEOC’s Chicago district. “Employers who punish employees who do complain are following a self-destructive scenario and ought not to be surprised when the EEOC shows up.”

Sparx closed down soon after the EEOC sued the restaurant, and was replaced by a Denny’s franchise. The owner of Northern Star Hospitality, Chris Brekken, could not be reached for comment. 

The court also ordered training for Brekken and other managers. 

Telemarketer starts new scheme

Posted by: Alejandra Matos Updated: February 3, 2014 - 5:32 PM

A Florida company previously sanctioned for bilking consumers out of millions in a telemarketing scheme is in trouble again, this time for an allegedly deceptive payday loan deal, according to the Federal Trade Commission.

Suntasia Marketing Inc. tricked consumers into giving up their bank account information by pretending it was needed for an online loan application, the FTC said last week. The company allegedly used the bank information to enroll consumers in an online mall membership.

A Florida judge imposed a $14.75 million judgment for violating a 2008 order that barred the company  from making misrepresentations to consumers. At the time the company defrauded consumers by charging  their bank accounts for travel clubs they did not sign up for. 

FTC: Email threats were fraud

Posted by: Alejandra Matos Updated: January 30, 2014 - 1:55 PM

The Federal Trade Commission has filed its first Affordable Care Act-related fraud case against a suspected spammer.

Kobeni Inc. and its president, Yair Shalev, were charged last week in federal civil court in southern Florida for sending e-mails to consumers that said they would be violating the law if they did not immediately click on a link to enroll in health insurance, the FTC said.

The links often contained grammatical mistakes such as “your breaking a federal law.”

The links sent consumers to a website with advertisements for insurance companies that did not authorize Kobeni to use their names, the FTC said.

Kobeni was paid by the website’s operators each time someone clicked the links contained in the ads, the FTC said.


Funeral home to pay $32,000 to settle consumer protection violation charges

Posted by: Brandon Stahl Updated: January 8, 2014 - 1:07 PM

After an undercover federal investigation, a New York funeral home has agreed to pay a $32,000 fine to settle charges it violated federal consumer protection laws

Funeral homes are required to provide consumers with accurate, itemized price information about services at the outset of making funeral arrangements, according to the Federal Trade Commission. 

Harrison Funeral Home and its owner, John Balsamo, were  accused of violating that law after FTC inspectors posed as consumers seeking to make arrangements and the funeral home failed to provide price lists.

The FTC "funeral rule" gives consumers numerous rights when dealing with funeral homes, including getting prices over the phone, getting casket prices before you actually see them, and making funeral arrangements without having to pay for embalming. 


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