Misleading mailings? What exactly is that, and how could it be a big legal problem for a business?
One Michigan company, ANS, Inc., which also uses the name “Workplace Compliance Services,” has become the target of complaints by businesses, several attorney generals in separate states and the Better Business Bureau for its mailings. At least 140 business owners have filed complaints about the issue.
In general, the mailings are directed at small business owners. State officials and owners say that the mailings, which are designed to drum up business for the company, look like they are coming from a government agency and offer a service to small business owners — for a fee — that is not required, overpriced or something that can be done free of charge.
The letters in the mailings give business owners the impression that they’re required by law to pay up. There are disclaimers included in the mailings — but even those are displayed in a way that is misleading.
There are laws that prohibit companies from sending overtly misleading mailings. The Deceptive Mail Prevention and Enforcement Act (DMPEA) is most often used to keep businesses from sending consumers direct mail to drive sales in an unethical and misleading fashion. For example, it requires disclosures that clarify something meant as an ad for what it really is to be “readily noticeable, readable and understandable.” For example, if you send customers sweepstakes entry forms, the forms cannot boldly proclaim that each person is a “winner” unless each person actually does win something.
The DMPEA doesn’t just apply to sweepstakes. It also covers facsimile checks, skill contests and mailings designed to look like government forms. Many companies are still surprisingly unaware of the law — which is why they may continue to violate it despite the heavy penalties it imposes. A company can be fined $2 million per project for a violation of the law.
If you have any doubts about the legality of a sweepstakes or ad campaign that you intend to mail out, it’s smart to get some legal advice for your business in advance. That’s the best way to head off a serious problem.
