The Federal Trade Commission says that BlueHippo, a consumer technology-buying service advertised on television, is collecting money from customers but is not delivering the goods and is asking a federal court for a contempt order.
The company advertises that it will help consumers buy computers, accessories and other electronic items without a credit check – it says with a down payment and a series of interim payments, its customers will be able to collect the purchased items. But according to the FTC, very few of the customers have received anything. FTC said that the company “collected more than $15 million from consumers based on claims that it would finance their purchases of new computers, but delivered neither the financing nor the financed computers, in violation of a 2008 court order.”
“Years of broken promises by BlueHippo have left consumers seeing red,” said FTC Chairman Jon Leibowitz. “We’re putting companies like this on notice: If you mistreat consumers and thumb your nose at the courts, we will hold you accountable.”
FTC claims the company continued to deceive customers even after signing the earlier settlement order. It is looking for customer restitution and an immediate stop to deceptive practices. The case is being filed in the U.S. District Court for the Southern District of New York.
RBR-TVBR observation: Remember back a little while ago when the FTC created a momentary panic by suggesting that the media holds ultimate responsibility for the accuracy of all advertising messages it runs? This is another instance that shows why such a regulatory scheme is unfair and unworkable.
It is impossible for any station or magazine or newspaper or website to thoroughly research the character of every single advertiser. And they certainly can’t look into a potential advertiser’s mind and divine future intent, nor can they deny selling an ad based on the possibility of deception that hasn’t even occurred yet.
The FTC is the cop on this beat, not the media, and that is the way it must remain.