The New York firm fed clients false claims that TV antennas might get a free cable: FTC
NEW YORK – With the average American family spending $ 700 a year on basic cable television, $ 1,200 when premium channels are added, it’s no wonder so many people fell for the advertising hype.
A New York-based company called Wellco, Inc. and its CEO George Moscone III were named as defendants in a recent Federal Trade Commission complaint.
The FTC has just announced that the defendants have agreed to pay the fees they “misleadingly advertised Skylink TV antennas to get more than 100 premium channels for free”.
“The defendants used every trick in the book to sell their antennas and amplifiers to people, including older adults, who wanted to save money on cable and satellite television channels,” said Daniel Kaufman, acting director of the FTC. “People should be able to trust what companies make and not discover they’ve been told lies after they buy.”
According to the FTC complaint, Wellco and Moscone, a Westchester County businessman, “made misleading performance claims for their wireless television antennas and associated signal amplifiers, using consumer notices that were either wholly manufactured or removed from competitor advertisements. They have also misrepresented that some of their web pages were objective news reports through the antennas. ”
The company also claimed it was the top-rated indoor TV antenna in the country, “developed by a NASA scientist”.
Since 2017, the defendants have marketed and sold the antennas and optional amplifiers online under four different brand names: TV Scout, Skywire, Skylink and Tilt TV. The bottom line was you’ll never have to pay for cable TV or subscription again. The antennas and amplifiers were sold for around USD 32 each and advertised with a 50% discount.
According to the FTC’s complaints, they sold more than 800,000 antennas and more than 272,000 amplifiers, which equates to $ 35 million. After installing the devices, consumers learned that they could only receive standard UHF and VHF channels, no more than a television antenna.
The proposed informed consent to settle the FTC’s complaint prohibits defendants from engaging in similar behavior in the promotion or sale of a product. In return, Wellco and Moscone do not have to admit the truth of the allegations.
In relation to the money raised, the proposed settlement order passed a judgment of $ 31.82 million against the defendants.
“However, the verdict will be suspended if the defendants paid $ 650,000 to the commission for being unable to pay the full verdict.” Pity!
According to FTC attorney Carl Settelmyer, Wellco and Moscone had to file affidavits and papers to show where all of the money was going. Generally, in such cases, the cost of advertising, manufacturing, shipping, and staffing make up a large part of the cost.
The $ 650,000 will leave very little to repay any of the victims. Settlemyer admits that the company’s relatively small verdict and promise not to repeat the same behavior may seem like a very small punishment, given the national scope of the deception and the number of victims.
“It’s frustrating for a lot of people,” he said. “We try to do the best we can with the circumstances that exist in a particular case in terms of financial relief.”
Neither Moscone nor his lawyer responded to our request for comment.
If you have a story for Arnold, please email Arnold.Diaz@PIX11.com
Suggest a correction
Suggest a correction