INDIANA — Attorney General Curtis Hill is warning Hoosiers to be skeptical of advertising mailers claiming they have won prizes – especially when “winners” must pick up prizes at car dealerships or other sales-oriented venues.
“Typically, the announcement that ‘you’re a winner’ is merely a ploy to entice you to go listen to someone’s sales pitch,” Attorney General Hill said. “We want Hoosiers to be alert to all varieties of misleading advertising so they can avoid wasting their time or, even worse, getting talked into making ill-advised purchases.”
In the last 12 months, the Office of the Attorney General has filed lawsuits against five promotional firms in connection with deceptive auto-advertising mailers promising prize winnings. Thus far, lawsuits have resulted in judgments against two such firms; the other three are pending.
Most recently, on Feb. 10, 2019, a Marion County court approved a consent agreement between the state and Traffic Jam Events LLC, which resolved claims by the Attorney General that the promoter violated Indiana law.
The complaint alleged the following with regard to Traffic Jam Events:
- The company sent mailers to more than 443,000 Indiana residents. As part of promotions orchestrated on behalf of auto dealers, Traffic Jam Events sent out game pieces such as scratch-offs. The mailings indicated that recipients with winning game pieces had won significant prizes – such as $5,000 cash, an iPad or a $500 gift card.
- Each mailing, however, contained identical game pieces with winning numbers. Thus, each mailing communicated to all recipients that they had won significant prizes when they had not. Recipients who went to dealerships to claim winnings were then awarded their “prizes” – typically nominal items such as $5 gift cards. Then they were subjected to sales pitches for vehicles.
The Attorney General claimed the mailings violated the Deceptive Consumer Sales Act in multiple ways, including false representations that recipients won specific prizes and false representations that the game pieces in the mailings determined whether recipients won prizes. Further, the complaint alleged the prize mailings also violated the Promotional Gifts and Contests Act by failing to include on the prize mailings the name and address of the promoter (Traffic Jam Events); failure to correctly state the odds of winning and the retail value of the prizes potentially awarded; and failure to include a disclaimer that recipients would be subjected to a sales pitch when claiming their prizes.
The consent agreement entered between the parties and approved by the court requires Traffic Jam Events to pay the State of Indiana a civil penalty in the amount of $57,500.
Traffic Jam Events is also required to include various specific disclosures in its mailings. It is also prohibited from sending any mailings that claim recipients have won prizes when they have not; from representing game pieces as a determinant as to whether recipients have won prizes; from classifying recipients as “winners” unless they have actually won a substantial prize; and from any other future violations of Indiana law.
In addition, Traffic Jam Events is required to provide the Attorney General with copies of all mailings it sends to Indiana recipients over the next three years so the Attorney General can monitor Traffic Jam Events’ compliance with the judgment.
The other four promotional firms involved with auto dealers and sued by the state within the last 12 months are:
- Dealer Direct Services Inc.
- DBR Integrity Promotions, Inc.
- Prophecy Marketing
- Xcel Media Group
If you believe you have been the victim of any type of scam or attempted scam, the Office of the Attorney General can help. To file a complaint, go to indianaconsumer.com or call 1-(800) 382-5516.