The Federal Trade Commission (FTC) and State of Florida have charged an individual and his company with violations of the FTC Act and the Florida Deceptive and Unfair Trade Practices Act for unlawfully requiring businesses to purchase labor law posters.
According to the complaint, the company misrepresented itself as a government agency or an affiliate and also misrepresented payment and posting obligations to the various businesses the company solicited. The complaint asserts that the company sent notices to new businesses explaining that the businesses were required to display labor law posters and must pay the company a fee for the posters. The notices also stated that a failure to comply would result in fines up to $17,000. Within each notice, the company cited federal laws, including repealed statutes, and listed a Business ID number and a response deadline. When consumers called the company’s listed number after they did not receive posters, an automated response would inform the caller that all lines were busy. There was no option to leave a message. Additionally, once a business purchased the labor law poster, the company would send a new notice the following year stating that the relevant law had changed and a new poster was needed for the same fee.
Neither the company nor its owner were associated with any government agency. Further, the complaint asserts that free posters are available from the government and they do not need to be replaced each year. The scheme allegedly managed to collect “more than $800,000 from more than 9,000 consumers.”
The complaint was filed in the Southern District of Texas. The FTC press release is located here.