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Deceptive Advertising

Deceptive Advertising Definition

Deceptive Advertising Definition

Deceptive advertising, also known as false advertising, refers to a manufacturer’s use of confusing, misleading, or blatantly untrue statements when promoting a product. Advertising law will protect consumers from deceptive advertising through the enforcement of specific legislation. Advertising law and consumer law have basically the same function: to promote truth in labeling.
Truth in labeling means that all pertinent information that a consumer should reasonably be aware of should be printed on the label of the product. This will ensure that consumers are protected, and know exactly what they are buying. This limits the level of manipulation by manufacturers and advertisers.
There are several different methods for attempting to deceive consumers that are not permitted under advertising law. One way is through hidden fees or the use of surcharges. This means that a company will charge extra fees beyond the advertised price for a certain product or service. This is very common in mobile phone contracts and air travel. 
Oftentimes, the company will try to protect themselves by disclosing the extra fees in the “fine print” of the contract. Most consumers will be unaware of these charges and overlook them when signing contracts. Advertising law mandates that the language of a contract must not be so confusing that it prevents a consumer from being aware of them. Oftentimes, especially in mobile phone contracts, activation fees will be included. Advertising law will permit these charges as long as they are disclosed to the consumer.
Another method of deceptive advertising occurs when “going out of business sales” actually charge customers more for products that had already been marked down. According to consumer law, this is an unfair practice because it takes advantage of and misleads the customer. By advertising that the company is going out of business and “everything must go” this tells the customer that the prices will be marked down. However, this is not always the case. A customer may actually pay a higher price than normal during a going out of business sale.
Advertising law also recognizes the manipulation of standards as a deception under consumer law. This means that a company will begin to change something, such as a unit of measurement, to mean something different from how it is normally understood. This will allow companies to charge more for their services, but is a violation of rights according to consumer law. 
Undefined terms is also considered a violation under consumer law. This will occur when manufacturers are very vague in their terms. They may be using terms that are not legally accepted and basically have little meaning.

Deceptive Advertising Overview

Deceptive Advertising Overview

Deceptive Advertising Definition
Deceptive advertising refers to the use of confusing or untrue statements by advertisers in an attempt to mislead the consumer. It is also known as false advertising. Advertising and consumer law function to protect the consumer and promote truth in advertising.
Truth in labeling is a concept in advertising and consumer law that mandates that all important information that a consumer should reasonably be aware of will be printed on the label of a product. This will ensure that consumers are well aware of the product they are purchasing and reduces consumer manipulation by advertisers and manufacturers.
There are several ways that businesses will use deceptive advertising, including: hidden fees and surcharges, bait and switch, misleading sales advertisements, and manipulation of the standards. Manufacturers may attempt to use vague language in order to confuse a consumer.

Bait-And-Switch Advertising
The bait and switch is a type of fraudulent advertising where advertisers will lure in a customer with the bait and then switch the deal so that the consumer ends up purchasing a higher priced item. A manufacturer may bait someone with the promise of a product at a very low price.
Once the customer is hooked, the manufacturer will change the arrangement by claiming the product is no longer available at that price. The idea is that the seller has already drawn in the customer, so there is little chance that he or she will lose the customer even when the deal is changed. 
Consumer law allows for customers who have been a victim of the bait and switch to take action against the advertiser in court. If it is proven that the defendant has engaged in fraudulent advertising, then the plaintiff can be awarded damages. The bait and switch is considered to be false advertising because the manufacturer actually has no intention of selling the given item at the advertised price. 

Online Deceptive Advertising
Deceptive advertising is a practice that has been ongoing for centuries. However, with technological advances, such as the Internet, online deceptive advertising has become more and more prevalent. Radio, television, and online advertising have become the major outlets for manufacturers to promote their products.
There are three main types of fraudulent online advertising: blatant misstatement of the facts, hidden fees and surcharges, and false claim-belief interaction. Claim-belief interaction occurs when an advertiser’s misleading claim results in an untrue assumption by the consumer.
Many claims of online advertising fraud relate to privacy protection. When a consumer makes an online purchase with a credit card, this information will not always be kept confidential. Also, many Internet sites will make claims of false investments or ways that an individual can make money by working at home. Many of these claims prove to be false.  

FTC Regulations Against Deception
The Federal Trade Commission (FTC), established in 1914, is tasked with protecting the rights of consumers. The FTC will create and enforce legislation that governs commercial practices. One division of the FTC, the Bureau of Consumer Protection, is most responsible for protecting the privacy of consumers and prohibiting deceptive advertising practices. 
The National Do Not Call List is a major piece of legislation developed by the FTC that protects consumer privacy against telemarketing phone calls. A citizen may call the phone number for the Do Not Call List and request to be added to the list. After a period of 31 days, telemarketing companies will no longer be able to call the phone numbers on this list. Once registered, the phone number will become permanently restricted from telemarketers. However, a consumer may still continue to receive calls from political organizations, charities, and businesses with which they have a previous relationship.  

Telemarketing & Electronic Advertising
Telemarketing is a business practice where businesses will attempt to solicit consumers through telephone calls to their home and places of business. These phone calls may be made by a telemarketer or a pre-recorded advertisement that will be replayed through automatic dialing. This automatic dialing system is often referred to as “robocalling” and is most associated with political advertisements.
Telemarketing is considered controversial because many people view these phone calls as an interference of their personal privacy. This is why the FTC has begun regulating the practices of telemarketers by establishing the National Do Not Call List.
Telemarketers will receive peoples’ telephone numbers from registries, previous purchase histories, or they may purchase them from other companies’ databases. Electronic advertising has been increasing in popularity over the years and allows businesses to reach target consumers with more accuracy.

Telemarketing & Electronic Advertising

Telemarketing & Electronic Advertising

Telemarketing is a business practice in which businesses solicit consumers through telephone calls to their homes or places of business. A telemarketing phone call may be placed by a person or a pre-recorded advertisement that will be replayed through automatic dialing.
Most people view telemarketing as an annoyance and an interference with their privacy. This is why there have been rules and regulations established by the Federal Trade Commission (FTC) that will restrict the practices of telemarketing companies. The National Do Not Call List, for example, allows consumers to add their telephone number to a list that cannot be accessed by telemarketing companies. A consumer is able to call a free telephone number and request to be added to the list. Once the phone number is added, a telemarketing company can continue to make phone calls for a period of 31 days. After this time, the restriction of this phone number is permanent.
Telemarketers usually will work from a business office or a call center. These calls will be made by people who receive a list of telephone numbers and are required to call a certain amount of consumers per day. They will usually have a pre-determined sales pitch that they are required to repeat during each telephone call.
Telemarketing calls that are made by automatic dialing are referred to as “robocalling”. This can often be seen in political advertisements. If a telemarketer is able to find an interested consumer, they will often make several follow-up calls to ensure that a deal can be made. Telemarketers will obtain phone numbers from credit information, surveys, and the previous purchase history. This is often helped by the advancement of electronic advertising.
Many people will fill out information on the Internet that includes a telephone number. In this case, telemarketing companies can use this information. These companies will often purchase telephone numbers from other businesses’ databases. With the aid of electronic advertising, these companies will be able to determine who will be most likely to purchase their product. This will be based on past purchase history, demographic, and other information. 
Electronic advertising has increased in popularity in recent years with technological advances, such as the Internet. It allows companies to reach their target demographic much easier than other forms of advertising. This is because electronic advertising can be based on the user’s past history.
For example, electronic advertising companies will be able to match up specific consumers with companies that provide these products and services. This will be based on their purchase history, websites they have visited, or terms that they have searched online. Electronic advertising is a very effective method of selling to consumers.

FTC Regulations Against Deception

FTC Regulations Against Deception

The major responsibility of the Federal Trade Commission (FTC) is to protect consumers against unfair practices. This United States Government Agency was established in 1914 by the Federal Trade Commission Act to protect the privacy and rights of consumers.
The FTC enforces a number of legislation that govern commercial practices, such as the prohibition of monopolies. The FTC has enacted several statutes to break up trusts and other business forms that discourage outside competition.
The FTC has three bureaus, each with specific duties. The Bureau of Competition is the division that is tasked with enforcing antitrust laws. The Bureau of Economics studies the impact of FTC regulations on the economy. The Bureau of Consumer Protection is the division that is responsible for protecting consumers’ privacy against deceptive advertising.
Deceptive advertising occurs when an advertiser will make false claims or promises to consumers based on misleading or untrue information. The main practices of this division is to investigate possible fraud by businesses and manufacturers, as well as promote education about proper advertising practices. The major areas of investigation for this Bureau are telemarketing fraud and privacy issues, such as identity theft.
One of the main pieces of legislation attributed to the FTC Bureau of Consumer Protection is the National Do Not Call List. The Do Not Call List allows citizens to have a certain amount of privacy by limiting the amount of telemarketing phone calls they will receive. In order to register for the Do Not Call List, a person may call a toll free number and request to be added to the list. The Telephone Consumer Protection Act of 1991 established several regulations protecting the privacy of consumers from unwanted telephone calls.
The Do Not Call List was established in 2003 in order to comply with this Act. Telephone numbers that are added to the Do Not Call List are permanently restricted from receiving telemarketing phone calls. Originally, the Do Not Call List required phone numbers to re-register after a period of five years. However, the Improvement Act of 2007 made the registration permanent to further protect consumers’ privacy. 
Cellular telephone calls are not included in the Do Not Call List because telemarketers are not permitted to call cellular phones. The FTC has confirmed that, despite rumors, cell phone companies will not release mobile phone numbers to telemarketers.
However, there are certain restrictions to the Do Not Call List. From the date a person’s phone number is placed on the Do Not Call List, a telemarketing company is still permitted to call this number for up to 31 days. A consumer will still be subject to receiving calls from political organizations, organizations conducting surveys, charities, and businesses with which the consumer has a previous relationship.    

Online Deceptive Advertising

Online Deceptive Advertising

Deceptive advertising refers to the use of confusing or untrue promises by an advertiser in order to mislead the consumer. Deceptive advertising is a type of fraud and is actionable under legislation that is designed to protect the consumer. It is sometimes done inadvertently by an advertiser. However, it is generally done purposely and intended to take advantage of consumers.
This practice has been prevalent for centuries. With the technological advancements in recent years, there is an increased amount of media advertising. Radio, television, and online advertising have become the major forms of product promotion in recent years.
There are basically three types of fraudulent practices that can be used in media advertising. Sometimes, advertisers will mislead consumers with a blatant misstatement of the facts, such as the bait and switch. In this case, the advertiser has no intention of providing the consumer with the product at the advertised price or condition.
Another type of deceptive media advertising occurs when companies include certain hidden fees or surcharges within the language of a contract. These charges are usually so confusing, or embedded within the fine print, that the consumer is completely unaware of them. A claim-belief interaction is a type of fraudulent media advertising where an advertiser will make a claim that leads to a mistaken belief by the consumer.
Online advertising has become a significant issue in deceptive advertising cases in recent years. Oftentimes, this online advertising fraud relates to privacy issues. The Internet allows a variety of purchases to be made online with the promise of businesses to keep this information private. However, this is often not the case. There have been cases where online advertising companies have released this information without consent. 
Online advertising fraud has also been found in cases where an Internet site offers fake stock options, credit card services, or fraudulent investment opportunities. Many Internet sites also offer a way to make money at home. This method of media advertising may promise that a person will be able to use his or her personal computer as a way to start a business at home.
For example, filling out surveys is a way that fraudulent online advertising companies will promise consumers compensation. However, it is very unlikely that these advertisers will be able to fulfill their claims.
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