DENVER — Colorado Attorney General John Suthers announced today that Colorado and 33 other states have settled allegations that Publishers Clearing House violated a 2001 consent decree prohibiting it from using false and deceptive trade practices to entice consumers to participate in its sweepstakes. Colorado will receive $320,000 from the $3.5 million settlement.
The multistate settlement reinforces a $34 million settlement the Office of the Attorney General reached with the company in August 2001 that imposed numerous restrictions on Publishers Clearing House’s sweepstakes promotion practices. The 2001 settlement stemmed from allegations that Publishers Clearing House used sweepstakes hype to convince recipients that buying something from the company would improve their chances of winning the grand prize.
Following the 2001 settlement, the Attorney General has been monitoring Publishers Clearing House’s sweepstakes solicitations. In 2006, the Attorney General along with several other states noticed that there was not an appreciable change in the company’s solicitations. The multistate group informed Publishers Clearing House that these new tactics violated the 2001 settlement.
Rather than face these charges in court, Publishers Clearing House has agreed to:
- Change the language the company uses in its mailings that insinuated that the more consumers spend with Publishers Clearing House the more likely they are to win prizes;
- Not use some specific tactics, such as telling a recipient that his or her entry code has a “key code” for the winning entry;
- Cease using the tactic of sending a communication from the “Board of Judges” to indicate that the recipient is close to winning; and,
- Hire an ombudsman to review the company’s solicitations on a quarterly basis.
The Office of the Attorney General alleges that these tactics can be particularly influential on senior citizens. This segment of the population comes from a generation where important information was communicated through the mail. The Attorney General urges family members, neighbors and friends to be cognizant of spending patterns that could indicate that a loved one is buying Publishers Clearing House products for the wrong reasons:
- Are they buying a small trinket that they will not use or give as a gift to help win the sweepstakes?
- Are there frequent deliveries to their homes?
- Are they buying duplicate items or several subscriptions to the same magazine?
If you feel that a family member, neighbor or friend needs some assistance please contact AARP ElderWatch or the Attorney General’s Office at 1-800-222-4444. You may also file a complaint online via www.coloradoattorneygeneral.gov/complaint.