NEW YORK — With the average American family spending $700 a year for basic cable TV, $1,200 if premium channels are added, it’s not a wonder that so many people fell for the advertising hype.
A New York-based company called Wellco, Inc. and it’s CEO George Moscone III were named as defendants in a recently-filed complaint by the Federal Trade Commission.
The FTC has just announced the defendants have agreed to settle the charges that they “deceptively advertised Skylink TV antennas as an effective way to get 100+ premium channels free.”
“The defendants used every trick in the book to sell their antennas and amplifiers to people, including older adults, who wanted to save money on cable and satellite TV channels,” said FTC Acting Director Daniel Kaufman. “People should be able to trust the claims companies make, not discover after buying that they were told lies.”
According to the FTC’s complaint, Wellco and Moscone, a Westchester County businessman, “made deceptive performance claims for their over-the-air television antennas and related signal amplifiers, using consumer endorsements that were either totally fabricated, or lifted from competitors’ ads. They also misrepresented that some of their web pages were objective news reports about the antennas.”
The company also claimed theirs was the top-rated indoor TV antenna in the country and was developed “by a NASA scientist.”
Since 2017, the defendants marketed and sold the antennas and optional amplifiers online under four different brand names: TV Scout, Skywire, Skylink and Tilt TV. The bottom-line claim was that you never have to pay for cable tv or subscription again. The antennas and amplifiers were sold for approximately $32 each, advertised as 50% off.
They sold more than 800,000 antennas and more than 272,000 amplifiers, taking in $35 million, according to the FTC’s complaints. The consumers learned, after installing the equipment, that they could not receive anything other than standard UHF and VHF channels, no more than any TV antenna.
The proposed consent order settling the FTC’s complaint prohibits the defendants from engaging in similar conduct when advertising and selling a product. In return, Wellco and Moscone do not have to admit the truth of the charges.
As for the money they collected, the proposed settlement order imposed a $31.82 million judgment against the defendants.
However, “the judgment will be suspended upon the defendants’ payment of $650,000 to the commission, based on their inability to pay the full judgment.” What a shame!
According to FTC Attorney Carl Settelmyer, Wellco and Moscone had to submit sworn statements and documentation to show where all the money went. Generally, in cases such as this, he says the cost of advertising, manufacturing, shipping and staffing make up bulk of the expenses.
The $650,000 will leave very little to repay any of the victims. Settlemyer admits that the relatively small judgment and the company’s promise not to repeat the same conduct may seem like very little punishment, given the national scope of the deception and number of victims.
“It’s frustrating to a lot of people,” he said. “We try to do the best we can with the circumstances that are left with any given case, in terms of monetary relief.”
Neither Moscone or his attorney responded to our requests for comment.
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