FTC Stops Another Diet Pill Scammer, But Still More On the Loose

January 16th, 2009
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FTC Stops Another Diet Pill Scammer, But Still More On the Loose

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Weight-loss-pill marketers who offered free samples in order to obtain credit card information have agreed to stop making false claims and unauthorized charges. The marketers-Neil J. Wardle, Pace Mannion, Christopher J. Wardle, and their companies UltraLife Fitness Inc. and Tru Genix LLC-made false and unsubstantiated statements that hoodia would cause long-term or permanent weight loss without having to reduce caloric intake or increase physical activity.

Many customers who provided their credit card information to cover shipping and handling were also charged for unauthorized periodic shipments. The FTC complaint was settled with a consent agreement under which the defendants were ordered to pay $9.9 million (the total estimated consumer injury).

However, based on inability to pay, each of the three must pay only $50,000 and the rest was suspended. The settlement agreement also bars the defendants from misrepresenting any material fact in connection with the sale of a dietary supplement, food, drug, device, or health-related program or service and from using billing information to acquire unauthorized payments.

Since 1990, the FTC has brought more than 100 regulatory actions against dubious weight-loss products. Despite this effort, the number of scams appears to be growing. Their marketers know that only a small percentage of scammers encounter regulatory action and that even those who do might still make millions.

The marketplace might improve, however, if weight-loss scams could be made less profitable to their “silent accomplices”: the media and credit card companies that facilitate the flow of misinformation and money. It probably would help to lengthen the period during which credit card holders can protest for unauthorized charges or nondelivery of dietary supplement products.

Another helpful strategy might be criminal prosecution for credit card fraud. [Barrett S. FTC curbs hoodia scammers. Diet Scam Watch, Dec 24, 2008] http://www.dietscam.org/reports/ultimate.shtml

Have any thoughts, comments or questions about these dirty ripoff, con-artists? Click the ‘comment’ link just below here – and chime in – I’d love to hear from you.

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