PRESS RELEASE

An operator who allegedly sent millions of illegal spam text messages to consumers is banned from sending any unsolicited text messages, under a settlement agreement with the Federal Trade Commission entered by a federal court.

According to the FTC complaint filed in February 2011, the marketer sent a “mind-boggling” number of unsolicited commercial text messages pitching mortgage modification services to consumers, and misrepresented that he was affiliated with a government agency. The FTC alleged that many consumers had to pay fees to their mobile carriers to receive the unsolicited text messages. The FTC also alleged that the marketer advertised his text message blasting services by sending consumers illegal spam. The agency charged him with violating the FTC Act and the CAN-SPAM Act.

The complaint states that the text messages instructed consumers to respond to the messages or visit various websites advertised in the messages. One of the websites, loanmod-gov.net, claimed to provide “Official Home Loan Modification and Audit Assistance Information,” and displayed a photo of an American flag. The agency alleged that the defendant collected information from consumers who responded to the text messages – even those who responded by asking to be removed from his list – and sold it to third parties, claiming the consumers were “debt settlement leads.”

The settlement order bans the defendant, Phil Flora, from sending or helping others send unsolicited commercial text messages, and bars him from making false or misleading claims about any good or service, including misrepresentations that he, his representatives, or any other person is affiliated or associated with a government agency. The order also bars him from violating the CAN-SPAM Act. The settlement order imposes a judgment of $58,946.90. Based on sworn financial representations made by Flora, the judgment will be satisfied when he turns over $32,000. If it is determined that the financial information he gave the FTC was not true, the full amount of the judgment will become due.

The Commission vote authorizing the filing of the stipulated settlement order was 5-0. The Central District of California entered the order on August 12, 2011.

NOTE: This stipulated order is for settlement purposes only and does not constitute an admission by the defendant that the law has been violated. Stipulated orders have the force of law when signed and approved by the District Court judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook and follow us on Twitter.

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