Three California Companies with Deceptively Marketing and Selling Auction Materials for Homes and Cars Three federal district court judges in Los Angeles this week ordered a temporary halt to the allegedly deceptive sales practices of three California-based companies that sell informational guides on how to purchase seized and repossessed cars and foreclosed homes. In two of the cases, the defendants also doubled-billed consumers by sending and charging for additional guides without the consumers' authorization. At the FTC's request, in each of the three cases, the courts froze the defendants' assets and appointed a receiver to manage the business affairs of each corporate defendant. The FTC is also seeking preliminary and permanent injunctions in the three cases, as well as other equitable relief. Consumers should be very wary of responding to ads touting information on how to obtain bargains on seized vehicles and repossessed homes.
Cars sold at government auctions and foreclosed homes typically sell for their market value.
Nationwide Information Service and Productive Marketing are based in Santa Barbara, California, and The Kohl Group is based in Los Angeles. The defendants purport to have current local listings of foreclosed homes that are available for purchase, as well as general information on how to purchase them. They also purport to have current local listings of vehicle auctions and information about purchasing items at auction. During the sales pitch, the telemarketers of each of these companies employ a series of deceptive tactics. The complaints allege that, for example, the defendants regularly assess charges to consumers' credit cards and automatically withdraw money from their checking accounts without authorization.