The Federal Trade Commission has announced two proposed settlements that will conclude their sweep against online marketers that allegedly used fake news sites to promote weight-loss products.
The two settlements, one with Beony International and owner Mario Milanovic and one with Beony International employee Cody Adams, each impose a $13 million judgment. However, that will be suspended when the defendants pay more $1.6 million and sell a 2008 Porsche. However, if the financial information the defendants provided is later determined to have been false, the full amount of the judgments will be imposed.
As with similar cases in the sweep, the FTC alleged that while Beony websites were designed to appear as if they were part of legitimate news organizations, they were actually advertisements delivering deceptive advertising about acai berry weight-loss products featured in the “news reports.”
The settlements also bar the defendants from further deceptive claims about any product or service, including the acai berry weight-loss supplements, colon cleansers, teeth whiteners, work-at-home plans, and surplus auctions that they marketed. The defendants also must disclose any material connections they have with merchants.