Martha Clark d/b/a Simplex Systems; Consent Agreement With Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 962-3027]

Martha Clark d/b/a Simplex Systems; Consent Agreement With

Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Consent agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting

unfair acts and practices and unfair methods of competition, this

consent agreement, accepted subject to final Commission approval, would

prohibit the Niverville, New York-based respondent from

misrepresenting, in her advertisements for a credit repair kit, any

remedy for credit history problems available under the Fair Credit

Reporting Act, including the ability to remove accurate but adverse

information from credit reports. The consent agreement settles

allegations stemming from advertisements on the Internet for Clark/

Simplex's Guaranteed Credit Doctor purported credit repair kit.

DATES: Comments must be received on or before May 31, 1996.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pennsylvania Ave., NW., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

C. Steven Baker, Chicago Regional Office, Federal Trade Commission,

Suite 1860, 55 East Monroe Street, Chicago, IL 60603, 312-353-8156

David Medine, Federal Trade Commission, S-4429, 6th and Pennsylvania

Ave, NW, Washington, DC 20580, 202-326-3224

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the

Commission's rules of practice (16 CFR 2.34), notice is hereby given

that the following consent agreement containing a consent order to

cease and desist, having been filed with and accepted, subject to final

approval, by the Commission, has been placed on the public record for a

period of sixty (60) days. Public comment is invited. Such comments or

views will be considered by the Commission and will be available for

inspection and copying at its principal office in accordance with

Sec. 4.9(b)(6)(ii) of the Commission's rules of practice (16 CFR

4.9(b)(6)(ii)).

Agreement Containing Consent Order To Cease and Desist

In the Matter of: Martha Clark, individually and doing business

as Simplex Services.

[File No. 962-3027]

The Federal Trade Commission having initiated an investigation of

certain acts and practices of Martha Clark, individually and doing

business as Simplex Services (hereinafter referred to as ``proposed

respondent''), and it now appearing that proposed respondent is willing

to enter into an agreement containing an order to cease and desist from

the acts and practices being investigated.

It is hereby agreed by and between Martha Clark, individually and

doing business as Simplex Services, and counsel for the Federal Trade

Commission that:

1. Proposed respondent Martha Clark is an individual doing business

as Simplex Services with her principal office or place of business at

135 Kipp

[[Page 14321]]

U., P.O. Box 36, Niverville, New York 12130.

2. Proposed respondent admits all the jurisdictional facts set

forth in the draft of complaint.

3. Proposed respondent waives:

(a) Any further procedural steps;

(b) The requirement that the Commission's decision contain a

statement of findings of fact and conclusions of law;

(c) All rights to seek judicial review or otherwise to challenge or

contest the validity of the order entered pursuant to this agreement;

and

(d) All claims under the Equal Access to Justice Act.

4. This agreement shall not become a part of the public record of

the proceeding unless and until it is accepted by the Commission. If

this agreement is accepted by the Commission, it, together with the

draft of the complaint contemplated hereby, will be placed on the

public record for a period of sixty (60) days and information in

respect thereto publicly released. The Commission thereafter may either

withdraw its acceptance of this agreement and so notify proposed

respondent, in which event it will take such action as it may consider

appropriate, or issue and serve its complaint (in such form as the

circumstances may require) and decision, in disposition of the

proceeding.

5. This agreement is for settlement purposes only and does not

constitute an admission by proposed respondent that the law has been

violated as alleged in the attached draft complaint or that the facts

as alleged in the attached draft complaint, other than the

jurisdictional facts, are true.

6. This agreement contemplates that, if it is accepted by the

Commission, and if such acceptance is not subsequently withdrawn by the

Commission pursuant to the provisions of Sec. 2.34 of the Commission's

Rules, the Commission may, without further notice to proposed

respondent, (1) issue its complaint corresponding in form and substance

with the draft of complaint here attached and its decision containing

the following order to cease and desist in disposition of the

proceeding, and (2) make information public in respect thereto. When so

entered, the order to cease and desist shall have the same force and

effect and may be altered, modified or set aside in the same manner and

within the same time provided by statute for other orders. The order

shall become final upon service. Delivery by the U.S. Postal Service of

the decision containing the agreed-to order to proposed respondent's

address as stated in this agreement shall constitute service. Proposed

respondent waives any right she might have to any other manner of

service. The complaint may be used in construing the terms of the

order, and no agreement, understanding, representation, or

interpretation not contained in the order or in the agreement may be

used to vary or contradict the terms of the order.

7. Proposed respondent has read the complaint and the order

contemplated hereby. She understands that once the order has been

issued, she will be required to file one or more compliance reports

showing she has fully complied with the order. Proposed respondent

further understands that she may be liable for civil penalties in the

amount provided by law for each violation of the order after it becomes

final.

Order

Definitions

1. ``Credit Report'' means any written, oral, or other

communication of information by a consumer reporting agency bearing on

a person's credit worthiness, credit standing, credit capacity,

character, general reputation, personal characteristics, or mode of

living that is used or expected to be used or collected in whole or in

part for the purpose of serving as a factor in establishing the

consumer's eligibility for credit.

2. ``Credit Repair Product'' means any product or service to

improve a person's credit report by removing adverse information

appearing therein, changing the rating of such information from

negative to positive, or otherwise enhancing the person's credit

report.

I

It is ordered that respondent Martha Clark, her agents,

representatives, and employees, directly or through any corporation,

subsidiary, division, or other device, in connection with the

advertising, promotion, offering for sale, sale, or distribution of any

credit repair product, in or affecting commerce, as ``commerce'' is

defined in the Federal Trade Commission Act, do forthwith cease and

desist from misrepresenting, either directly or indirectly, in writing,

via a computer communications network, or by any other means, any right

or remedy available under the Fair Credit Reporting Act, 15 U.S.C.

Sec. 1681 et seq., including, but not limited to, the ability to remove

adverse information in any credit report.

II

It is further ordered that respondent shall:

A. Within thirty (30) days from the effective date of this Order

deliver a copy of this Order to each of her officers, agents,

representatives, and employees who are engaged in the preparation or

placement of advertisements, promotional materials or other such sales

materials covered by this Order.

B. For a period of five (5) years from the effective date of this

Order deliver a coy of this Order to each of her future officers,

agents, representatives, and employees who are engaged in the

preparation or placement of advertisements, promotional materials or

other such sales materials covered by this Order, within three (3) days

after the person assumes such position.

III

It is further ordered that for a period of five (5) years from the

date this Order becomes final, respondent shall notify the Commission

within thirty (30) days of the discontinuance of her present business

or employment and of each affiliation with a new business or

employment. Each notice of affiliation with any new business or

employment shall include her new business address and telephone number,

current home address, and a statement describing the nature of the

business or employment and the duties and responsibilities.

IV

It is further ordered that within sixty (60) days after service of

this Order, and at such other times as the Commission may require,

respondent shall file with the Commission a report, in writing, setting

forth in detail the manner and form in which she has complied with this

Order.

V

This Order will terminate twenty years from the date of its

issuance, or twenty years from the most recent date that the United

States or the Federal Trade Commission files a complaint (with or

without an accompanying consent decree) in federal court alleging any

violation of the Order, whichever comes later; provided, however, that

the filing of such a complaint will not affect the duration of:

A. Any paragraph in this Order that terminates in less than twenty

years;

B. This Order's application to any respondent that is not named as

a defendant in such complaint; and

C. This Order if such complaint is filed after the Order has

terminated pursuant to this paragraph.

Provided further, that if such complaint is dismissed or a federal

court rules that the respondent did not

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violate any provision of the Order, and the dismissal or ruling is

either not appealed or upheld on appeal, then the Order will terminate

according to this paragraph as though the complaint was never filed,

except that the Order will not terminate between the date such

complaint is filed and the later of the deadline for appealing such

dismissal or ruling and the date such dismissal or ruling is upheld on

appeal.

Analysis of Proposed Consent Order to Aid Public Comment

The Federal Trade Commission has accepted an agreement, subject to

final approval, to a proposed consent order from respondent Martha

Clark, individually and doing business as Simplex Solutions.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and the comments received and will decide whether it should

withdraw from the agreement and take other appropriate action or make

final the agreement's proposed order.

This matter concerns claims made by the respondent in her

advertising, including advertising through the Internet, for the

Guaranteed Credit Doctor credit repair kit. The Commission's complaint

charges that the respondent's advertising represents, directly or by

implication, that consumers can remove bankruptcies, judgments,

foreclosures, liens, repossessions, late payments, and other adverse

items of information from their credit reports even where such

information is accurate and not obsolete. The claim is alleged to be

false and misleading, and in violation of section 5 of the Federal

Trade Commission Act, 15 U.S.C. 45, because most consumers cannot

remove adverse items of information from their credit reports where

such information is accurate and not obsolete.

The proposed consent order contains provisions designed to remedy

the violation charged and to prevent the respondent from engaging in

similar acts and practices in the future. Part I of the proposed order

prohibits the respondent from misrepresenting, directly or by

implication in her advertising for any credit repair product any right

or remedy available under the Fair Credit Reporting Act, 15 U.S.C. 1681

et seq., including, but not limited to, the ability to remove adverse

information in any credit report. Part II of the proposed order

requires the respondent to distribute copies of the order to certain

company officials and employees. Part III of the proposed order

requires the respondent to notify the Commission of any discontinuance

of her present business or employment and of each affiliation with a

new business or employment. Part IV of the proposed order requires the

respondent to file one or more compliance reports. Part V of the

proposed order is a provision whereby the order, absent certain

circumstances, terminates twenty years from the date of issuance.

The purpose of this analysis is to facilitate public comment on the

proposed consent order. It is not intended to constitute an official

interpretation of the agreement and proposed order or to modify their

terms in any way.

Donald S. Clark,

Secretary.

[FR Doc. 96-7864 Filed 3-29-96; 8:45 am]

BILLING CODE 6750-01-M