referred to as “bait and switch.” Additional examples of unfair advertising include incorrect pricing, fake
endorsements, deceptive guarantees, making false statements, and providing descriptions that exaggerate
the performance of the product or service.
Taking Advantage of Customers
The FTC also pays particular attention to business ventures that target vulnerable populations. For example,
some telemarketing efforts employ intense pressuring tactics to target seniors and people who don’t speak
English.
E X A M P L E  1 2 . 1
For months, Ivan had searched for just the right window curtain to match the décor of his new high rise
condo. Finally, while browsing through Amazon, he saw two gray velvet curtains that featured a damask
pattern, with taupe and gold accents and specks of ice blue glitter accents. He could not have designed a
more perfect color palette for the window treatments if he tried. Moreover, the velvet blackout touch was
just what he needed. Excited, he hit the “Buy Now” button and waited a couple of days for his order to
arrive. When it did, what a huge disappointment! He could see, if he stared long and hard enough, how
someone with a vivid imagination might consider the curtain to be an abstract interpretation of what was
advertised. However, most people would see that the product was not at all close to what was advertised.
The velvet was closer to linen, the damask pattern was closer to swirls, and the taupe and gold accents with
specks of ice blue were closer to silver and purple, with specks of mauve. After running a Google reverse
image search of the original product photo, he saw it featured in an interior design magazine. When Ivan
looked up the product endorsements and reviews, he saw that all of the reviewers had only posted reviews
for that particular seller’s products, and that they had posted nothing but glowing reviews for each of the
products. It was clear to Ivan that the seller was guilty of false advertising, as well as faking endorsements.
Ivan has enough information to submit a consumer complaint to the Federal Trade Commission.
E X A M P L E  1 2 . 2
Devin is involved in the telemarketing of spy gadgets, such as bugs and bug detectors. He has had a lot of
trouble finding a market for these products. One day, he speaks with an older citizen who asks him about
the benefits of the bug detector. Devin starts to knowingly make unsubstantiated claims that there have
been news reports that home bugging is on the rise. His false claims works like a charm. Spooked, the
elderly customer buys the most expensive bug detector product. Seeing his success, Devin purchases a
report of households in his geographic selling area that are headed by people over the age of 70. Over the
next few months, his sales increase at an explosive rate. When he is recognized by management for his
leading sales numbers, they also inquire about the secret to his success as they seek to replicate it in
training materials for other sales professionals. When Devin proudly explains his tactics, he is terminated by
the company. The company calls the customers impacted by his false claims, explains that there was a
misrepresentation by one their sales associates regarding the scope of known bugging activity, allows them
to keep their bug detectors, and refunds them the money they spent purchasing the products. The sales
associate engaged in unfair trade practices, but the company took appropriate steps to correct it.
Chapter 12 Unfair Trade Practices and the Federal Trade Commission
135