Sites like DMV.com are "patently misleading" consumers, judge says
A federal judge has ordered the companies behind a chain of websites that purport to offer basic government services to stop claiming they can renew a driver's license, register a car and perform a host of other tasks.
The suspension comes two months after the Federal Trade Commission filed a complaint against On Point Global and about 50 other web-based companies. The agency alleged in December that On Point, Eagle Media, Dragon Global, Macau Media, Skylar Media, Blackbird Media and others created websites that deceive customers into trying to complete transactions like obtaining a fishing license or applying for Section 8 housing.
The websites were available nationwide, the FTC said, and had a common nomenclature like floridadriverslicense.org, michigandriverslicense.org or texasdriverslicense.org. When visiting the sites, customers "were not clearly informed that they could not obtain the government service they were misled to believe was available," the court order states.
After customers enter their credit card information for payment, the websites provide documents that are already publicly available on how to complete the service, the FTC said. The companies "do not deliver the services they tout," the agency said in its complaint, noting the more than 200 associated websites that have created since 2013 as part of the scheme.
"Cleverly designed," but deceptive
The complaint cited technology entrepreneur Burton Katz of Miami as the "mastermind" behind the services, while also naming Miami lawyer Brent Levison, Miami real estate developer Robert Zangrillo, Arlene Mahon and Elisha Rothman as co-conspirators.
The FTC had asked a federal district court to order On Point to stop their practices. Judge Robert Scola, Jr. from the Southern District of Florida ruled "there is good cause to believe" Katz and the others violated federal deceptive commerce act regulations. The companies misrepresented on their websites that they provided government services to consumers who paid and gave personal information, according to Scola's order.
"The websites were cleverly designed so that, even though disclosures appeared on many or most of the pages, consumers attention would be drawn to links and language in larger, more colorful font that directed them to the service they were seeking," Scola's order states.
Attorney Patrick Campbell, who is representing On Point Global, could not be reached for comment.
Katz and others also created websites where consumers were led to believe they could apply for government benefits like food stamps or unemployment, the FTC said. Those sites asked people to share personal information including birth dates, income range, employment status, health insurance and telephone numbers.
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- Federal Trade Commission
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- Florida
Khristopher J. Brooks is a reporter for CBS MoneyWatch covering business, consumer and financial stories that range from economic inequality and housing issues to bankruptcies and the business of sports.
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