Wednesday, January 25, 2006
Attorney General Abbott Announces Settlement With Charity Sweepstakes Marketer
Newport Creative Communications’ methods misled vulnerable seniors
AUSTIN - Texas Attorney General Greg Abbott today announced a multi-state settlement with a Massachusetts-based sweepstakes marketing consultant that used questionable promotions to entice donations to charities in exchange for the chance of winning big prizes.
In many cases, the tactics created by Newport Creative Communications for its charity clients made it appear that the recipients of the materials, often seniors or lower income consumers, had already won large sweepstakes jackpots.
|States' agreement with Newport|
“This company crossed the line in raising funds in the name of charities with strong emotional appeal,” said Attorney General Abbott. “While we support charitable giving, we will not tolerate companies that take advantage of seniors or those who are vulnerable.”
Newport offered its services to numerous charities, including those supporting cancer, heart disease, Alzheimer’s research and the cause of missing and abused children. The sweepstakes games and promised prizes served as enhancements to generate additional money from the public.
Despite Newport’s contention it does not require donations for consumers to be eligible for monetary prizes, the Attorney General determined that mailed correspondence built clear expectations that the recipient had won if he or she responded to the solicitation. Newport used language such as “absolutely no strings attached” and “$6,000 cash payment to be confirmed upon reply; payment schedule enclosed,” and queries to recipients such as “Why haven’t you claimed the $6,500 cash prize?”
Additionally, the marketer engaged in a deceptive “pre-selection” sweepstakes wherein a random “winning number” was generated by computer prior to mailing the sweepstakes correspondence, which defies the definition of “sweepstakes.”
A legal agreement Newport signed with Texas and18 other states ensures the company will no longer engage in promotions claiming a consumer has “won” a sweepstakes unless that person has actually won. Newport may not promote a “payment schedule” suggesting consumers will win on a specific date unless that information is factual.
The company must also halt its mailing practices suggesting a governmental agency or the postal service has played a heightened role in the prize announcement involving the consumer.
Other states signing on to the agreement include Arkansas, California, Kentucky, Massachusetts, Michigan, Minnesota, Montana, Nevada, New Jersey, North Carolina, Ohio, Oregon, Pennsylvania, South Carolina, Tennessee, Virginia, Washington and Wisconsin.