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The Federal Trade Commission (FTC) is pursuing a broader administrative complaint against a marketing company and its owner for allegedly luring consumers to auto sales events using deceptive COVOD-19 stimulus relief and price mailers.

The FTC said it is now charging Traffic Jam Events, LLC and its owner David J. Jeansonne II with multiple counts of deceptive conduct.

In the administrative complaint, the Commission alleged that the respondents distributed deceptive advertisements and promotional materials including mailers that claimed to provide COVI-19 stimulus relief to consumers.

Allegations against Traffic am Events and its owner

Around March 2020, Traffic Jam Events and Jeansonne II allegedly started to deceptive marketing materials to lure consumers to go to dealerships. The ads claimed that COVID-19 stimulus relief is available at designated locations for a limited time. The mailers led consumers to believe that they could obtain financial assistance in person at the “relief headquarters,” which were actually auto sales events.

In addition, the FTC alleged that the respondents disseminated mailers claiming that the recipients won prizes to lure them and their families to auto sales events. The mailer included a purported official winning code with an instant cash price of $2,500.

The mailer invited consumers to check if they are a “guaranteed winner” by pulling a tab to see if the code is similar to the one in the “combination box.”  It reads, “If your digital electronic combination box matches the official winning code and one of the codes below, you are a guaranteed winner. . . .”

In the mailer, consumers were instructed to go to a car dealership to “claim” the prize. However, a small print on the back of the mailer stated that a consumer’s chance to win a prize is 1-in-52,000.

The Commission alleged that Traffic Jam Events and Jeansonne II violated Section 5 (a) of the FTC Act and Section 144 of the Truth in Lending Act (TILA) and Section 226.24(d) of Regulation Z, 12 C.F.R. §226.24(d).

The FTC’s original complaint against the respondents did not include their alleged violation of the TILA and Regulation Z.

State law enforcement actions

The FTC noted that the State Attorneys General of Florida, Indiana, and Kansas recently sued Traffic Jam Events and its owner for deceptive marketing.

Jeansonne II entered into a consent agreement with Indiana on behalf of his company.

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