FTC Charges Contempt in Cramming CaseThe Federal Trade Commission issued contempt of court charges yesterday against an Internet firm it accuses of violating a ban on deceptive practices, including placing unauthorized charges on a telephone bill, known as "cramming."
According to the FTC, Mercury Marketing of Delaware Inc., based in Philadelphia, violated a March 1, 2001, agreement settling charges with the FTC. Those charges alleged that Mercury used telemarketing to offer small businesses Web design and advertising services and charged their phone bills, but also charged the telephone bills of some who declined the service or only asked for free information, the FTC said.
Neal D. Saferstein, who is CEO of Mercury and a member of its board of directors, according to Mercury's Web site, Gointernet.net, did not return a call for comment yesterday.
In some cases, the small-business owners could not remember receiving a call from Mercury, according to the FTC. As part of the settlement, Mercury agreed to avoid misleading consumers and to receive express, verifiable permission before issuing charges.
Yet Mercury has continued to engage in deceptive practices by billing businesses without authorization, the FTC said. The agency said it conducted a random survey of 417 Mercury customers, taken from a list provided by Mercury, and found that only one had agreed to hire Mercury to maintain a Web page.
None actually received such a service, and 72 percent were unaware that a monthly charge of $29.95 from Mercury was appearing on their telephone bills, the FTC said.
Mercury also came under fire earlier this year when the Michigan Attorney General's office filed charges accusing the company of cramming the state's residents in January.