Skip to content

FTC Steps Up Actions Against Deceptive Marketers Online

Last month, the Federal Trade Commission (FTC) announced actions or settlements against multiple businesses it alleges engaged in various forms of deceptive and misleading online marketing. The variety of businesses - from supplement merchants to student loan consolidators - demonstrates the broad use of deceptive practices and how they continue to flourish online. It's a reminder to payment service providers and e-commerce platforms that virtually any merchant poses risk for deceptive marketing.

Highlights from the FTC in just the past month include the following:

 

The FTC announced that Renaissance Health Publishing, LLC and its owner would refund more than $76,000 to consumers who purchased Isoprex, a supplement comprising mostly herbs and spices. According to the FTC, the company made problematic claims that the product could relieve suffering from muscle and joint pain, headaches, arthritis, joint inflammation, and a range of other ailments in older adults.

 

Arete Financial Group and other related companies agreed to pay at least $835,000 to settle FTC allegations that their student debt relief program charged illegal upfront fees and made false promises. The FTC first alleged in 2019 that the companies pretended to be affiliated with the US Department of Education and deceptively promised loan forgiveness, consolidation, and repayment programs for those with student debt to reduce or eliminate payments and balances.

 

More than 70,000 consumers will receive reimbursement in response to an FTC settlement with NeuroMetrix, Inc., a company that sold Quell, a wearable transcutaneous electrical nerve stimulation device. According to the FTC, the company touted the device as "clinically proven" and "FDA cleared" for chronic pain relief. The pain claims lacked scientific evidence and claims about FDA clearance for this use were false, according to the FTC.

 

The FTC alleged that a company using the name "SBA Loan Program" and the website SBALoanProgram[.]com misled small businesses to believe they had an affiliation with the US Small Business Administration and could provide access to the relief programs offered as a result of the pandemic. The settlement announced last month prohibits Ponte Investments, LLC, and its owner from misrepresenting that they are authorized to accept or process applications for SBA loans and that they are in any way affiliated with the SBA or the US government.

 

More than 12,000 consumers will receive checks from a $110,000 settlement over a complaint the FTC filed with  Excellent Marketing Results, Inc. The FTC alleges the company made problematic claims about the supplement's ability to treat or relieve joint pain.

 

The FTC announced last month that Online Trading Academy (OTA) will pay between $5 and $9.1 million as well as forgive the debt of thousands of consumers as part of a settlement over deceptive marketing practices. The FTC alleged that for years the company used sales pitches with testimonials to promise significant income from their investment training program, when in actuality most purchasers made little to no money.

 

At LegitScript, our mission is to make the internet and payment ecosystems safer and more transparent for businesses and internet users. Our experts proactively track high-risk areas and provide analysis of whether a merchant may be engaged in deceptive marketing posing regulatory, reputational, or credit risk. Our merchant monitoring provides best- in-class solutions for identifying and removing these problematic vendors.

Want to learn more? Download our guides on deceptive practices. Just click on the images below.

 

David Khalaf is a writing, communications, and marketing professional with specialties in media, investigations, content strategy, and writing instruction. His 20 years of writing, media, and communications work have included two top-tier universities (USC and UCLA), print and digital magazines, consulting firms, and technology companies.

His current work involves content strategy and development at LegitScript, a company that helps the world's leading search engines, payment service providers, and internet platforms and marketplaces do business with legitimate, legally operating entities in more than 80 countries and 15 languages around the world. LegitScript specializes in risk and compliance for highly regulated industries including CBD/cannabis, online gambling, cryptocurrencies, drugs, financial trading, online adult, scams and fraud, and more.

Recent Blog Articles

Merchant Onboarding Essentials: What You Need to Know

Modern merchant onboarding involves much more than collecting documents - it's about building a smart, scalable risk management process that can keep up with changing technology and fraud tactics. Whether you're launching a payments platform or refining your underwriting approach, getting onboarding...

LegitScript Marketplace Risk Panel Recap: The Dark Side of Weight-Loss Drugs: Regulation, Risk, and Red Flags

Marketplaces and other online platforms must constantly revisit and stress test their policies to ensure they are properly mitigating risk while providing sufficient room for growth. But what happens when a new regulation or trend upends those policies? Listen below to an excerpt of the panel discus...

Trust, Risk, and the Future of Compliance: Key Takeaways from Marketplace Risk San Francisco 2025

Marketplace Risk San Francisco 2025 offered a rare opportunity to pause the noise and listen closely to the industry, to its undercurrents, and to the questions no one's asking on stage. Once you're tuned in, you begin to hear the real story: an acute urgency around platform trust, growing anxieties...

Partnering for Compliance: What Platforms and Pharmaceutical Manufacturers Need to Know

Pharmaceutical manufacturing is a quickly growing sector that in recent years has been riding a wave of demand resulting from the booming telehealth industry, GLP-1 weight loss drugs, and an aging population requiring increasing medical care. Keep reading to understand how pharmaceutical manufacturi...