Attorney General Cuomo Announces Settlement With Online Directory For Deceptive Yellow Pages Solicitations
NEW YORK, N.Y. (May 12, 2008) - Attorney General Andrew M. Cuomo today announced a settlement agreement with a national online directory service for defrauding thousands of small businesses and not-for-profits across New York state and the nation.
Under the terms of the court-ordered settlement, the company will pay a $150,000 penalty and up to $3 million in restitution to defrauded customers.
The agreement settles a lawsuit filed by the Attorney General’s Office in February charging Bright Pages L.L.C. and its principals with mailing false and misleading solicitations to small businesses, individual practitioners and charitable groups. The mailings, which included the familiar “walking fingers” logo, appeared to be from the local Yellow Pages phone directory seeking to verify existing advertising accounts. Instead, they were order forms to buy a listing on Bright Pages’ online directory.
“Today’s agreement sends a strong message about the consequences of deceptive sales practices in New York State,” said Attorney General Andrew Cuomo. “This company disregarded good business ethics and truthful marketing to line its pockets at the expense of unsuspecting small businesses and charities. These practices will not be tolerated.”
Tens of thousands of companies and customers around the country and New York State were deceived into ordering services they did not want or intend to purchase at rates of $77 per month or $231 every quarter. Many were unaware of the deception and others who discovered the fraud encountered problems when they attempted to cancel and get refunds.
Under the terms of the settlement, Bright Pages will refund all customers it deceived during the entire period of time the company has conducted business, from November 1, 2006 - April 30, 2008. The company has also agreed that all future solicitations will clearly disclose the services it is selling and will honor all future requests for refunds and/or cancellations.
“Bright Pages has finally seen the light,” said Ronald J. Verrochio, Postal Inspector in Charge, New York Division. “We will not tolerate the use of the US Mail to facilitate schemes such as this one that bilked honest, hard working Americans out of thousands of dollars. With this settlement, orchestrated so swiftly by the New York State Attorney General's Office, we will soon be able to tell the victims their claim forms for refunds are in the mail.”
The Attorney General’s investigation, triggered by numerous complaints from the United States Postal Inspector’s Office and the Better Business Bureau, found that solicitations from Bright Pages clearly displayed the words “YELLOW PAGES” in bold capital letters next to the familiar “walking fingers” logo and falsely implied that the local Yellow Pages phone directory was merely requesting verification of the recipient’s existing account. In reality, the solicitations were order forms for listings with Bright Pages, which is not affiliated with any telephone company and does not publish print directories. The Bright Pages’ name and references to its online directory appeared only in the footnotes and buried in the terms on the reverse page.
Under the terms of the settlement, Bright Pages will retain an independent third party as settlement administrator for the Attorney General to process claim forms and refunds. The settlement administrator will be mailing claim forms to all customers within an enclosed return envelope. In order to obtain refunds, all completed claim forms must be filed within 35 days of date of mailing.
Bright Pages, L.L.C, is located at 20 Warren Street, 2nd Floor, New York. The company’s principals, Michael L. Smith and Shannon Courtney Mabry are residents of Florida.
The case was handled by Deputy Bureau Chief Melissa Saren and Bureau Chief Joy Feigenbaum of the Attorney General’s Bureau of Consumer Frauds and Protection.
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