FTC settles first Y2K fraud case
In what the agency called its first Y2K-related fraud case, the U.S. Federal Trade Commission said yesterday it has settled with a Canadian company over charges that telemarketers made false and misleading claims about year 2000 protection services.
The company, NCCP Ltd., doing business as National Credit Card Protection Ltd., was selling credit-card protection telling consumers they only had 48 hours to report the loss or theft of a card in order to avoid liability for unauthorized charges (in the U.S., there is no time limit for making those reports, the FTC said). In addition, the FTC said the company was offering a Y2K protection package claiming to prevent Y2K-related problems by affixing adhesive stickers to credit cards, the commission said in a statement.
The settlement calls for NCCP and its owner to pay $100,000 to the agency, bans the company and its owner from selling credit-card protection or registration programs in the U.S. and bars them from making Y2K misrepresentations, among other provisions, the FTC said.
The consent judgment was filed with the U.S. District Court in Buffalo, N.Y., the FTC said. It doesn't mean the defendant has admitted any violations of federal law, the FTC noted.