The U.S. District Court in Los Angeles has ordered three California companies in three separate lawsuits to stop selling guides on how to purchase seized and repossessed cars and foreclosed homes.
The orders come on the heels of an ongoing Federal Trade Commission enforcement campaign against deceptive auction guides.
'Consumers should be very wary of responding to ads touting information on how to obtain bargains on seized vehicles and repossessed homes,' said Steven Baker, director of the FTC's Midwest regional office in Chicago.
'Cars sold at government auctions and foreclosed homes typically sell for their market value. And information about the government's sales programs is available for free on the Internet and from other sources.'
At the FTC's request, the courts froze the companies' assets and appointed a receiver to manage the business affairs of each of the firms. The FTC also is seeking preliminary and permanent injunctions to keep the companies out of the guidebook business.
The FTC filed charges against three companies June 19, Nationwide Information Service and Productive Marketing, both of Santa Barbara, Calif., and Kohl Group of Los Angeles, alleging the companies billed or debited consumers' credit cards or bank accounts without authorization; failed to disclose the conditions of their refund policies; and misrepresented the auction guides they sell.
In some cases, the companies allegedly double-billed consumers for the guides by sending extras without consumers' authorization.
The guidebook companies have not admitted to wrongdoing.