[{"pubDate":"Wed, 07 Oct 2026 08:05:50 +0200","url":"https://www.ftc.gov/business-guidance/blog/2014/10/first-ftc-rosca-case-challenges-bogus-bogo-free-claims","titre":"First FTC ROSCA case challenges bogus BOGO and \"free\" claims","id":3201052,"description":"First FTC ROSCA case challenges bogus BOGO and \"free\" claims wfg-adm109 October 21, 2014 | 12:02PM First FTC ROSCA case challenges bogus BOGO and \"free\" claims By Lesley Fair It’s called ROSCA – the Restore Online Shoppers’ Confidence Act – and it prohibits marketers from charging consumers for an online transaction unless the marketer has clearly disclosed all material terms of the deal and received the consumer’s express informed consent. Your e-commerce clients will want to know about the FTC’s first ROSCA case , filed recently in Nevada. According to the lawsuit, Health Formulas, LLC and a tangle of related California- and Nevada-based companies and individuals – consumers may know them as Simple Pure Nutrition – pitched a variety of products for weight loss, muscle building, virility, and skin care. The defendants advertised diet supplements like Pure Green Coffee Bean Plus and RKG Extreme as a shortcut to drop the pounds: “Burn fat without diet or exercise,” “Extreme weight loss!” “Shed pounds fast!” “Super concentrated double fat burning,” etc. Among the defendants’ more colorful business names: Weight Loss Dojo, Longhorn Marketing (sorry, Texas fans), Black Bull, and Unleash the Thunder. But unsubstantiated weight loss claims were just the start. The FTC says the defendants lured people in with bogus promises of a “free” trial or deceptive buy-one-get-one (BOGO) offers. Then they tricked consumers into giving their credit or debit card information with the false implication that consumers had to “just pay shipping.”   Digits in hand, the defendants really went to town, allegedly signing consumers up without their authorization for a negative option program that billed their accounts over and over again, to the monthly tune of between $60 and $210. The FTC says the defendants violated ROSCA by using a negative option feature without providing clear and conspicuous disclosures, getting the consumer’s express informed consent, and offering a simple mechanism for stopping the recurring charges. The FTC’s complaint also cites the defendants’ hard-to-find and hard-to-understand fine-print “terms and conditions,” which consumers could reach only by scrolling through the equivalent of two printed pages and clicking on an obscure hyperlink. Assuming they found it – and that’s a big if – the typical “terms and conditions” document was 10 pages long. On some websites, consumers had to scroll down the payment page to see further fine-print disclosures about the cost of the products. The first sentence reiterated what consumers generally understood (“You must pay a shipping and handling fee of $4.95 for us to send you a full 30 day supply of Garcinia Cambogia Extract”) but it wasn’t until the middle of the paragraph that the defendants mentioned that the trial period lasts only 14 days, that it began when the items were shipped (not delivered), and that consumers would be charged after that. Other websites didn’t even include that information. According to the lawsuit, consumers who attempted to take the defendants up on their money-back guarantee were met with a series of undisclosed roadblocks. In addition to the ROSCA counts, the FTC says the defendants’ practices violated the Electronic Fund Transfer Act by debiting consumers’ accounts on a recurring basis without their prior written authorization. What’s more, the complaint charges that the defendants continued to call people after being told to cut it out, in violation of the Telemarketing Sales Rule’s entity-specific Do Not Call provisions. The FTC says they also violated the TSR through a series of deceptive upsells. A federal judge has entered a temporary restraining order and the FTC is seeking to put a permanent stop to the defendants’ illegal practices. If your clients have ROSCA questions, the","source":"FTC USA Business Blog Posts"},{"url":"https://www.ftc.gov/business-guidance/blog/2023/05/franchise-fundamentals-taking-deep-dive-franchise-disclosure-document","titre":"Franchise Fundamentals: Taking a deep dive into the Franchise Disclosure Document","pubDate":"Tue, 06 Oct 2026 08:06:24 +0200","source":"FTC USA Business Blog Posts","description":"Franchise Fundamentals: Taking a deep dive into the Franchise Disclosure Document lfair May 23, 2023 | 6:41PM Franchise Fundamentals: Taking a deep dive into the Franchise Disclosure Document By Lesley Fair Love at first sight may (or may not) be a real thing, but when it comes to investing your money, it’s unwise to fall for a franchise without first subjecting it to tough-minded scrutiny. The third in the FTC’s Franchise Fundamentals blog series walks through an essential part of that evaluation: an in-depth review of the Financial Disclosure Document (FDD) required by the FTC’s Franchise Rule . You must receive the Franchise Disclosure Document at least 14 days before you’re asked to sign any contract or pay any money to the franchisor or one of its affiliates. In fact, you have the right to the FDD once the franchisor has received your application and agrees to consider it. So speak up if you don’t receive it and ask questions – lots of them – as you review the FDD and any attached documents.   Image Indeed, the franchisor’s conduct regarding the FDD may raise some red flags about how they do business. Providing the FDD doesn’t establish that a franchisor is reputable – it’s required by law, after all – but if a franchisor doesn’t promptly provide this mandatory document, gives you an incomplete FDD, evades your probing questions, or tries to rush you through the process, it doesn’t speak well of their approach to legal compliance.  Assuming you have the FDD in hand, let’s consider some of the 23 required items line by line. Here are things to look for as you review the FDD. Franchisor’s Background (FDD Item 1) Item 1 provides background information about the franchisor and any parent companies, predecessors, and affiliates, including how long the franchise has been in business. It also lets you know if there are any legal requirements unique to the franchised business, like the need to get a special license or permit. This can help you understand the costs and risks you would be taking on. Business Background (FDD Item 2) Remember the old adage “People are known by the company they keep”? Well, companies are known by the people they keep, which is why Item 2 identifies directors, principal officers, and other key executives. Pay attention to their business backgrounds, their experience in managing a franchise system, and how long they’ve been with the franchisor. Litigation History (FDD Item 3) Item 3 lists information about prior litigation, including whether the franchisor or any of its executive officers have been convicted of certain crimes or have been found liable – or settled lawsuits – related to the franchise relationship. Lawsuits against the franchisor could mean it hasn’t honored its agreements or that franchisees are dissatisfied with its performance. Item 3 also says whether the franchisor has sued any of its franchisees in the past year. That information could suggest problems in the franchise system. For example, if a franchisor sued franchisees for failing to pay royalties, was it because franchisees weren’t successful and couldn’t make their royalty payments? Bankruptcy (FDD Item 4) Have the franchisor, its affiliates, or any of its executives filed for bankruptcy? Item 4 discloses that information and could give you insights into the financial condition of the business.  Initial and Other Fees (FDD Items 5-7) Items 5-7 go over some of the costs involved in starting and operating a franchise. That could include things like deposits or franchise fees (some of which may be non-refundable); what you’ll have to pay for initial inventory, signs, equipment, leases, or rentals; and ongoing costs, like royalties and advertising fees. A Consumer’s Guide to Buying a Franchise suggests more than a dozen other areas of financial inquiry, which should give you an indication about the importance of both getting in touch with your inner bean","id":3199079}]