Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC actions lead to halt of three online yellow pages scam operations, (Jul 17, 2014)

By Linda O’Brien, J.D., LL.M.

Three FTC complaints have led to a halt of Montreal-based telemarketing operations that allegedly took millions of dollars from small businesses, churches, nonprofits and local government agencies by charging them for unwanted listings in online “yellow pages” directories, the Commission announced today. In a fourth case, a federal court has entered a judgment and order against another Montreal-based directory operation in a case brought by the FTC last year.

At the request of the FTC and the Florida Attorney General, federal judges in Florida temporarily halted and froze the assets of two operations, National Business Advertising and Your Yellow Pages. In another case brought by the FTC in Washington, a federal judge temporarily halted the unlawful business practices of another operation, OnlineYellowPagesToday.com. In all three cases, the government seeks to permanently stop the illegal practices and make the defendants refund victims’ money. In a case brought by the FTC in November 2013 against Online Local Yellow Pages, a federal judge entered a $15.6 million judgment against the defendants and banned them from the directory business.

National Business Advertising. According to a complaint filed by the FTC, (FTC v. 7051620 Canada, Inc., File No. 142-3046), the defendants - Francois Egberongbe, Robert N. Durham, Sr., and 7051620 Canada Inc., also doing business as National Business Advertising, Nationwide Marketing Bureau Inc., National Biz Ads, and Yellow Business Ads - used a variety of deceptive tactics to represent that consumers owed money for business directory listings and advertising services they never ordered, and in many cases, never received.

These defendants also pretended to be various debt collection companies, such as TransUnion Credit Bureau, Regional Debt Recovery, and RDR Collections Inc. The defendants got some consumers to pay, in amounts ranging from $200 to more than $1,500, by promising to stop contacting them and to close the accounts, but they kept billing them afterward. In addition, the complaint alleges that the defendants violated the Florida Deceptive and Unfair Trade Practices Act.

Your Yellow Pages. In its complaint, (FTC v. Your Yellow Pages, Inc., File No. 142-3047), the FTC alleged that the defendants in this case – Donovan B. Hinds, a/k/a Donavan B. Hinds; Ernest Baxter, a/k/a Ernest Baster and Carl Jenkins; Andrew Beitler; Your Yellow Pages Inc.; Rapid Pages Inc.; and City Pages Inc.; and Online City Yellow Pages – used a variety of deceptive tactics to represent that consumers owed money for business directory listings they never ordered. They often cold-called small businesses or non-profits, and often falsely claimed that the consumers owed them money for the second year of a two-year contract, and that the consumers owed amounts ranging from $400 to more than $1,800.

These defendants also pretended to be a Florida debt collection company, EBS Collections. They got some consumers to pay by promising to stop contacting them, but they kept billing them anyway. In addition, the complaint alleges that the defendants violated the Florida Deceptive and Unfair Trade Practices Act.

OnlineYellowPagesToday.com. According to the FTC’s complaint, (FTC v. OnlineYellowPagesToday.com, Inc., File No. 142-3043), the defendants – Oni Nathifa Julien; OnlineYellowPagesToday.com Inc.; USYellowPageDirectory.com Inc.; 7703236 Canada Inc., also doing business as OnlineYellowPagesToday.com, Target Marketing, and Oniks Media; and 7095333 Canada Inc.; and Oniks Media – typically contacted consumers under the guise of confirming contact information in a directory in which the small business or other organization already appeared. Subsequently, the defendants billed consumers $479.95 or more, using the walking fingers image often associated with local yellow page directories on invoices and other correspondence.

Online Public Yellow Pages. The FTC also announced that the federal district Court in Chicago has entered a default judgment of more than $15.6 million based on consumers’ losses, and a permanent injunction against the defendants behind a Canadian based directory scam operation, Mohamad Khaled Kaddoura, Derek Cessford, and Aaron Kirby, and their 15 companies. In its complaint, the FTC charged that the operation, doing business as Online Local Yellow Pages, claimed to be calling consumers about existing yellow pages listings or cancellation requests, but then billed them $499 or more for unwanted new listings, and often bullied consumers into paying by threatening to sue them or damage their credit ratings. The court subsequently halted the scheme and froze the defendants’ assets, pending litigation.

The court order also prohibits the defendants from misrepresenting material facts about any products and services, selling or otherwise benefitting from customers’ personal information, failing to properly dispose of customer information, and collecting money from customers. The case is FTC v. Modern Technology, Inc., File No. 132-3144.

Companies: 7051620 Canada Inc.; Your Yellow Pages Inc.; OnlineYellowPagesToday.com, Inc.; Modern Technology, Inc.

News: ConsumerProtection FederalTradeCommissionNews