Markets Wired

An Arizona-based telemarketing operation that identified itself as “Helping Hands of Hope” has settled charges that it conned consumers into buying household items such as light bulbs and trash bags that were priced substantially higher than at retail, by falsely promising the proceeds would benefit charities or the disabled. The defendants will be permanently barred from such fraudulent conduct and from calling consumers who have asked not to be called.

According to the FTC’s complaint, filed in May 2008 as part of the “Operation Tele-Phoney” multi-agency law enforcement sweep against telemarketing fraud, the Helping Hands of Hope defendants used telemarketing to target consumers nationwide, including many who were elderly. In addition to making false promises, Helping Hands’ telemarketers harassed consumers who resisted buying products, sent consumers products they never ordered, and then claimed that they had, in fact, ordered them, the complaint alleged. Finally, the FTC charged that Helping Hands’ telemarketers violated the National Do Not Call Registry rules by calling consumers even after they had asked not to be called again.

The court order settles the FTC’s charges against Helping Hands of Hope, Inc.; U.S. Blind Services, Inc.; Employment Opportunities of America, Inc.; Third Strike Employment, Inc.; and Robyn Mayhan. It prohibits the defendants from misrepresenting, or assisting anyone else in misrepresenting, that:

• a consumer’s purchase will benefit handicapped or disabled people;
• anyone working for the companies is handicapped or disabled;
• any of the companies’ products are made or packaged by the handicapped or disabled;
• or that any company operates a charitable organization.

The order also bars the defendants from mailing or billing consumer for any merchandise they did not order. Further, Helping Hands and the other defendants are prohibited from violating the FTC’s Telemarketing Sales Rule, including calling any number that is on the National Do Not Call Registry, calling consumers who have asked not to be called again, and failing to pay the annual fee required to access the Registry.

Finally, the order imposes a judgment of $26.3 million against all of the defendants. The corporate defendants will turn over assets worth more than $60,000 in partial satisfaction of the judgment. The judgment against Mayhan, the companies’ president, has been suspended based on her inability to pay. She will have to pay the full amount if she is later found to have misrepresented her financial condition.

The Commission vote authorizing the staff to file agreed-upon final order in consent of the court action was 4-0. It was filed in the U.S. District Court for the District of Arizona, on April 1, 2010, and entered by the Court on April 6, 2010.

NOTE: This stipulated final order is for settlement purposes only and does not constitute an admission by the defendant of a law violation. A stipulated final order requires approval by the court and has the force of law when signed by the judge.

Copies of the stipulated final order are available from the FTC’s Web site at http://www.ftc.gov and from 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 and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, click: http://www.ftc.gov/ftc/complaint.shtm or call 1-877-382-4357. The FTC enters Internet, telemarketing, identity theft, and other fraud-related complaints into Consumer Sentinel, a secure, online database available to more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad. For free information on a variety of consumer topics, click http://ftc.gov/bcp/consumer.shtm.

(Helping Hands.wpd)
(FTC File No. X080048; Civ. No. CV-08-0909-PHX-JAT)