A good read for all internet marketers from the Federal Trade Commission.
Found at:
http://www.ftc.gov/opa/2002/04/energysurf2002.shtm
Release Date: April 18, 2002
FTC Warns Internet Marketers about Making Misleading Claims about the Benefits of Gas-Saving and Other Energy-Related Devices
Consumers Should be Wary of Questionable Claims
As
gas prices creep higher and higher heading into travel season, the
Federal Trade Commission recently conducted an Internet surf to detect
and deter the deceptive marketing of products that purportedly save
energy. After the surf, the FTC staff sent warning letters
to more than 50 companies making questionable gas-saving and other
energy-related advertising claims. While most of the warnings were
targeted at marketers of automotive gadgets and additives, additional
warnings addressed Internet marketers of purported energy-saving
products for the home. The letters reminded the advertisers that they
need scientific substantiation for their energy-saving claims and
provided them with additional advertising guidance.
The
warnings advised that the recipients may be subject to law enforcement
action if they make deceptive claims in the future. "Our message to
industry is that false or inflated energy-saving claims will not be
tolerated. Our message to consumers is that they should be skeptical of
dramatic fuel-savings claims for automotive and other products," said
J. Howard Beales, III, Director of the FTC's Bureau of Consumer
Protection.
The warning letters involved the following types of products:
- Fuel-Saving
Automotive Devices and Additives: Numerous Web sites make implausible
claims for various aftermarket automotive devices (fuel-line magnets,
air bleed devices, and other retrofit gadgets) and additives that
supposedly increase gas mileage (and sometimes reduce emissions) for
automobiles. For example, FTC staff found claims such as "saves
thousands of dollars on gas!" or "increased mileage up to 300%." The
staff's experience with these products suggests that many of these
claims are either false or grossly exaggerated. In addition, the
Environmental Protection Agency (EPA) has evaluated or tested more than
100 purported gas-saving devices and additives, and has not found any
product that significantly improves gas mileage.
- Instantaneous
Water Heaters & Home Water Purification (or Softening) Systems:
Some distributors are making exaggerated claims about the performance
and the energy savings associated with instantaneous ("tankless") water
heaters and home water purification or softening systems (e.g., "save
50% on hot water costs"). The Commission previously challenged similar
claims for water purification systems.
- Transient
Voltage Surge Suppressors: Although these products can protect
equipment from power surges, in the past the Commission and the states
have challenged claims that these products provide significant savings
for consumers' energy bills.
The
Internet surf and warning letters are part of the FTC's continuing law
enforcement efforts to combat deceptive energy-saving claims. Late last
month, the Commission approved a consent order with Kryton Coatings
International and Procraft, Inc., which claimed that their "liquid
siding" provides insulation equivalent to seven inches of fiberglass
batting and R-20, and reduces utility bills up to 40 percent. In
November 2001, the Commission obtained a consent decree resolving
charges that Esrim Ve Sheva Holding Corp. (Gadget Universe) and its CEO
made false and unsubstantiated claims for Super FuelMAX, an automotive
fuel-line magnet (e.g., "A certified EPA laboratory reports an amazing
27% in increased mileage and 42% reduction in harmful pollutants").
The
FTC cautions consumers to be wary of drastic energy-saving claims. The
FTC has issued several consumer education brochures on topics such as
purported fuel-saving automotive devices (Gas-Saving Products: Facts or Fuelishness?), gas-saving tips (How To Be Penny Wise, Not Pump Fuelish), and guidance for heating and cooling homes (Weathering the High Cost of Heating Your Home and Cooling Your Home: Don't Sweat It, among other publications). The FTC also has a dedicated energy & environment Web page: http://www.ftc.gov/bcp/conline/edcams/eande/index.html which links to these materials, as well as other energy efficiency information for consumers and businesses.
Details
about EPA's motor vehicle aftermarket retrofit device evaluation
program and related consumer information are available at: http://www.epa.gov/otaq/consumer.htm.
Copies
of the documents related to the FTC's law enforcement actions, and
consumer and business education materials, are available from the FTC's
Web site at http://www.ftc.gov and
also from the FTC's Consumer Response Center, Room 130, 600
Pennsylvania Avenue, N.W., Washington, D.C. 20580. The FTC works for
the consumer to prevent fraudulent, deceptive and unfair business
practices in the marketplace and to provide information to help
consumers spot, stop and avoid them. To file a complaint, or to get
free information on any of 150 consumer topics, call toll-free,
1-877-FTC-HELP (1-877-382-4357), or use the complaint form at http://www.ftc.gov.
The FTC enters Internet, telemarketing, identity theft and other
fraud-related complaints into Consumer Sentinel, a secure, online
database available to hundreds of civil and criminal law enforcement
agencies in the U.S. and abroad.
- Media Contact:
- Howard Shapiro
Office of Public Affairs
202-326-2176
- Staff Contact:
- Joni Lupovitz
Bureau of Consumer Protection
202-326-3743