FTC taking action against free acai pill trials

August 17, 2010 4:55:32 AM PDT
A federal judge has frozen the assets of Phoenix-based company that markets acai berry weight-loss pills online through free trials.

It comes as the Federal Trade Commission files a lawsuit against the company, claiming it used deceptive business practices that cost consumers millions of dollars. That company is accused of deceptive advertising and unfair billing practices in the sale of supplements that were marketed for weight loss or cancer prevention.

The lawsuit announced Monday in Chicago also accuses the company of using false endorsements from Oprah Winfrey and celebrity cook Rachel Ray.

Fake celebrity endorsements caught the attention of some consumers trying to lose weight. Federal officials says the consumers thought the endorsements were real, then got into contracts they couldn't get out of, all for pills containing laxatives.

Now, some consumers and federal officials are warning others looking for deals online.

A preschool teacher from downstate and a stock broker from Ohio have become unexpected consumer advocates after being caught up in what the Federal Trade Commission calls a deceptive business.

"We're hard working people trying to put food on the table, and that money was taken away from us," said Rhonda Wooten, preschool teacher.

"Would you want your mom to be scammed like this. Think of your loved ones," said Heather Boedecker, stock broker.

Monday, the FTC announced a lawsuit against Central Coast Nutraceuticals -- or CCN -- and four other businesses all operated out of the same office in Phoenix, Arizona. The FTC captured one of their websites where it advertises: weight loss, health benefits and a free trial offer of their acai berry products.

The Better Business Bureau and other agencies have received 2,800 complaints in just three years about CCN.

"Consumers need to understand, the next time they're browsing on the internet, they should be wary of free or risk-free trials," said David Vladeck, Federal Trade Commission.

Heather Broedecker says she tried a free trial offer for over a week with no results. Then she says she got threatening calls about money owed to the company.

"I didn't like the way they put that it's gonna hurt your credit, because I've built up my credit to be very good, and for them to say this is going to hurt your credit unless you pay, that was definitely a jab," said Broedecker.

Rhonda Wooten also says she ordered a free trial for a small shipping fee. She says CCN took between $200-$500 from her debit account for a subscription she didn't ask for.

"I've got four kids that don't have that money because I spent it on this," Wooten said.

Visa assisted with the investigation and suggests consumers:

  • read and understand all terms and conditions,
  • pay attention to any pre-checked boxes - failing to uncheck boxes can bind you to terms and conditions,
  • review credit and bank statements for any unauthorized charges,
  • try to resolve the situation with the merchant - if your not successful, dispute the charge immediately with your bank.

Oprah Winfrey sued CCN and dozens of other companies for using a fake endorsement from her. The law firm Davis and Gilbert representing Ms. Winfrey issued a statement, saying in part, "It is important for the public to be aware that these marketers are out there and to carefully research any offer that claims to be endorsed by a celebrity figure."

Attempts by ABC 7 to reach CCN, or the other companies, or their officers were not successful. The officer holders are due in court on Friday. But at this time they do not face any criminal charges.


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