Wyatt Marketing Corporation, Inc

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF WY A TT MARKETING CORPORATION, INe.

CO:-SENT ORDER, ETe. , IN REGARD TO ALLEGED VIOLA TIO:- OF SEe. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3510. Complaint, July 1994-- Decision, July, 1994 This consent order prohibits, among other things, a Califomia based company from distributing an infomercial, from making false claims regarding a book on the availability of government grants and loans, and from making or selling any commercial that misrepresents it as an independent program, rather than a paid advertisement. The respondent is required to have a disclosure statement for any commercial 15 minutes or longer, and to have substantiation for future claims regarding the availability of grants, loans or other benefits from any source, the tems or conditions of getting government loans or grants. and methods for starting or operating a business. Appearances For the Commission: Michael 1. Bloom and Donald G. Amato. For the respondent: Glenn W. Peterman, McDonough, Holland & Allen Sacramento, CA.

CO MPLAJ:H The Federal Trade Commission, having reason to believe that Wyatt Markcting Corporation, Inc. , a corporation, and James R. Wyatt, individually and as an officer and director of said corporation (hereinafter collectively, "respondents ), have violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, alleges:

PARAGRAPH I. Respondent Wyatt Marketing Corporation, Inc. (formerly doing business as James R. Wyatt & Associates, Inc. and Cornerstone Publishing) is a California corporation that has had its principal office or place of business at 4231 Pacific Street, Suite 4 Rocklin, California.

PAR. 2. Respondent James R. Wyatt, at alj times pertinent herein, has been an officer and director of respondent Wyatt Marketing Corporation, Inc. Individually or in concert with others, WY A TT MARKETING CORPORA TION, INe.

Complaint he has formulated, directed, and controlled the acts and practices of the corporate respondent, including the acts and practices alleged in this complaint. His principal office or place of business has been the same as that of the corporate respondent.

PAR. 3. Respondents have manufactured, advertised, labeled offered for sale, sold, and distributed various materials that are represented to feature information on obtaining government benefits to start a new business, to obtain money for college, or to save on taxes, including but not necessarily limited to a book entitled 101 Ways to Get Cash From the Government (hereinafter also referred to as the " Government Benefits Book"

PAR. 4. The acts and practices of respondents alleged in this complaint have been in or affecting commerce, as "commerce " is defined in Section 4 of the Federal Trade Commission Act. COUNT I PAR. 5. Respondents have disseminated or have caused to be disseminated advertisements for the Govcrnment Benefits Book including but not necessarily limited to a 30-minute advertisement that appears in the form of a talk show entitled " Focus on Success (hereinafter also referred to as the "Government Benefits Infomercial"), a complete transcript of which is attached hereto as Exhibit A. These advertisements contain the following statements: flames Wyatt) ... there s a program called, through the United States Department of Agriculture, through what they c:ill their Farmers Home Administration agency and they ve got a program to where YOll can qualify for a house for 0 down and 1 percent interest, and I as a general contractor have built 3 000 of those homes and sold them to people back in America. Zcro percent down and I percent interest. So it s not a fluke. As a matter of fact, this year, I think the government, in that particular agency, the Farmers Home Administration has a $5.7 billion program strictly for housing of people. You can buy a single family home as wel! as apartments. "

IGeorgc Readings So its not a fluke'?" Ijames WyattJ No.

LGeorge Reading I heard you right - 0 percent down; 1 percent interest?" IJames Wyatt) For 32 years, 31 days. (Exhibit A) FEDERAL TRADE COMMISSION DECISI00lS Complaint 118 FTC PAR. 6. Through the use of the statements contained in the advertisements referred to in paragraph five, including but not necessarily limited to the advertisement attached as Exhibit A respondents have represented, directly or by implication, that the Farmers Home Administration had $5.7 billion in loan money available for individuals for the purchase of single family homes and apartments.

PAR. 7. In truth and in fact, the Farmers Home Administration did not have $5.7 billion in loan money available for individuals for the purchase of single family homes and apartments. During the time period that respondents disseminated or caused to be disseminated the Government Benefits Infomercial, the loan money available for individuals from the Farmers Home Administration for the purchase of single family homes and apartments totaled approximately $1. billion per federal fiscal year. Therefore, the representation set forth in paragraph six was false and misleading.

COU:-TII PAR. 8. Respondents have disseminated or have caused to be disseminated advertisements for the Government Benefits Book including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: lGeorge Readingl It gets even hetter, doesn t it? Here s one that says How You May Be Entitled To A $10 000 Refund. (James \Vyattj Yep. Do you know how many people in America that overpay might be entitled to that? YIight and I put might because not everybody is, hut one out of every three taxpayers in the United States is overpaid in this Social Security Administration system. We give you the tclcphone number and address of the agency to call. They will send out and tell you, in fact whether you in fact owed money back. $ 10,000 bucks. They wiII look it up-- they tell you- s simply done by a telephone call and simple signature on a form and they ll show you how to do it.

(Exhibit A) PAR. 9. Through the use of the statements contained in the advertisements referred to in paragraph eight, including but not necessarily limited to the advertisement attached as Exhibit A respondents have represented, directly or by implication, that the WYATT MARKETING CORPORATION, INe.

Complaint Government Benefits Book gives the reader a telephone number to call to find out whether she or he has overpaid into the Social Security System and to determine whether she or he is entitled to a refund from the Social Security Administration. PAR. 10. In truth and in fact, the Government Benefits Book does not give the reader a telephone number to call to find out whether she or he has overpaid into the Social Security System and to detennne whether she or he is entitled to a refund from the Social Security Administration. Therefore, thc representation set forth in paragraph nine was false and misleading.

COUNT II PAR. II. Respondents have disseminated or have caused to be disseminated advertisements for the Govcrnment Benefits Book including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: l George RcadingJ AII right. 'ColIeet Social Security Before Age 65.''' Ijames Wyatt I That s exactly right. ,. IGeorge Readings FuII Benefits (James WyattJ That s right. full benefits before age 65.You didn know that, did you?"

(George Readingj No I didn t know that. I suspect a lot of people didn know that.

Ijames WyattJ !\o, most people in America don t know that. IGeorge Readings How do you do that short of being disabled?" Ijames Wyatt) Y ou ask. You ask, George. I mean I know it sounds too good to be true, but we tell you the agency to call up and say this is what I'm going to do and they will even teII you back, George. They II teII you how and when you can retire to make the type of income levels you want to.

(Exhibit A) PAR. 12. Through the use of the statements contained in the advertisements referred to in paragraph eleven, including but not necessarily limited to the advertisement attached as Exhibit A respondents have represented, directly or by implication, that individuals could retire before age 65 and still collcct full social security retiremcnt benefits.

PAR. 13. In truth and in fact, individuals could not retire before age 65 and still collect full Social Security retircment benefits. Under FEDERAL TRADE COMMISSIO;\ DECISIONS Complaint 118 FTC. the Social Security Act, retirement insurance benefits are permanently reduced by 5/9 of I percent for each month before age , the65 that an individual is entitled to such benefit. Therefore representation set forth in paragraph twelve was false and misleading. COUNT IV PAR. 14. Respondents have disseminated or have caused to be disseminated advertisements for the Government Benefits Book, including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: (George Readings Pretly fascinating. 'How to Get Up To $5 Million To Start A Business flames Wyatt) Yes, that s right. It' s true. It's for a person who wants to start a business or expand an existing business that they have.

(George Readings What kind of money do you need to get into that?" flames Wyatt) It doesn t cost you a dime. You go in and apply through what is caJjed a business plan, George. Okay, you take a business plan into this government agency and they will approve your business plan and give you the money or say no you need have to clean it up, you re missing it over here and they even give you the consulting services for free.

(George Readingl How long does it take you?" flames Wyatt) Okay, it takes 47 days. Interest rate is 3 percent to 7. percent.

flames WyattJ And anybody here in the TV audience who has a good idea for business can go in and get that money. (Exhibit A) PAR. 15. Through the use of the statements contained in the advertisements referred to in paragraph fourteen, including but not necessarily limited to the advertisement attached as Exhibit A, respondents have represented, directly or by implication, that there was a federal agency that would loan an individual with a good idea for a business up to $5 million to start a business or expand an existing small business at terms of 3 percent to 7. 5 percent interest. PAR. J 6. In truth and in fact, there was not a federal agency that would loan an individual with a good idea for a business up to $5 million to start a business or expand an existing small business at terms of 3 percent to 7.5 percent interest. The United States Small WYATT MARKETING CORPORATION, r:-e.

Complaint Business Administration, with few exceptions, only guarantees loans to small businesses. Those federal agencies that do loan money for business do so for very specific types of enterprises, such loans do not approach $5 million, and, in many instances, the interest rates for these loans are not 3 percent to 7. 5 percent. Therefore, the representation set forth in paragraph fifteen was false and misleading. COUNT V PAR. 17. Respondents have disseminated or have caused to be disseminated advertisements for the Government Benefits Book including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: (James WyattJ In the second chapter we talk about educational services that are available. All the way from preschool aU the way to getting your doctorate degree or becoming even a medical doctor. You ve got 4 different programs to choose from. One of them is called a grant where you can get up to $11 000 a year to go to school per year and you never have to pay the money back at all. Then there s another one where there s a student loan at 3% interest. Then there another one at 7% interest and even if you have payments you don t get a grant to go to school--you don t have to pay any payments at all until you graduated and you have up to 10 years to repay the loan. So anyone who wants to go to school it s there. The problem is nobody came in and applied for the money, therefore, the budgct was cut and then nobody came in and everybody was being told in the newspapers there s no college money so nobody even came in and applied for more money. So there s about 3 billion dollars of unused money just last year alone strictly because of media hype.

I George Reading) How can you know where you can qualify for a grant or a Joan?"

IJames Wyatt) Youjust got to go in and ask George. It' s based upon need. It's based strictly upon need--how much is it going to cost you to go to school, how beneficial will your education be to society and it s just going and asking the questions. See the problem is George is nobody in America knows which agency to go to get it. That s what the book talks about. It's not a get rich quick book. ""hat it is is a resource book. It tells you which agency to go to, then you go in and ask the Complaint 118 FTC.

information. What you get in those agencies it is their responsibility to give you the money and that s what they do.

(Exhibit A) PAR. 18. Through the use of the statements contained in the advertisements referred to in paragraph seventeen, including but not necessarily limited to the advertisement attached as Exhibit A respondents have represented, directly or by implication, that the Government Benefits Book contains information concerning: A. The availability of a federal government grant program for college educational purposes under which a student mayor could obtain up to $11 000 annually.

B. The availability of a government student loan with a 3 percent interest rate.

PAR. 19. In truth and in fact:

A. The Government Benefits Book does not contain information concerning the availability of a federal government grant program for college educational purposes under which a student mayor could obtain up to $11 000 annually. During the time period of the airing of the Governmcnt Benefits Infomercial, even those students with exceptional financial need could have only obtained just over $6,000 in government grants for college educational purposes. B. The Government Benefits Book does not contain information concerning the availability of a government student loan with a 3 percent interest rate. During the time period of the airing of the Government Benefits Infomercial, the lowest interest rate for a government student loan was percent. Therefore, the representations set forth in paragraph eighteen were false and misleading.

COUNT VI PAR. 20. Respondents have disseminated or have caused to be disseminated advertisements for the Government Benefits Book including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: WYATT MARKETING CORPORATION INe.

Complaint IQuestion from 1 am a part-time student and I work part-time also and the audience) I heard you mention something about getting a home for $1. I'd really be interested in purchasing a home for $ J, but I can t come up with a down payment right now. Who would I get in touch with to find out about HUD-is that what you call that?"

lJames Wyatt) That's onc agency. The Housing and Urban Developmen! -- that's known as HUD. The book gives you seven ways to buy a hOllse for nothing down. With programs sponsored by the United States government o dOWIl- I percent interest. Urban Homesteading -- ,$1 to totally buy the house. We got a variety of other programs that arc in there that require nothing down. Now, see I know that people laugh about this, but I've built 3 000 houses for people in America where their total down payment was $0 down and their interest payment was I percent. On a $60 000 house -principal, interest, taxes and insurance your monthly payments are 127 bucks. That s cheaper than rent and so anybody in America that sits back and says 1 can afford a house is nonsense. What you can t afford to do is not to buy the book. I'm sorry but that s the truth. (Exhibit A) PAR. 21. Through the use of the statements contained in the advertisements rcfeITed to in paragraph twenty, including but not necessarily limited to the advertisement attached as Exhibit A respondents have represented, directly or by implication, that the Government Benefits Book contains infonnation on seven different federally sponsored programs that allow individuals to buy a house with $0 down and at loan terms of 1 percent annual interest. PAR. 22. In truth and in fact, the Governmcnt Benefits Book does not contain infonnation on seven different federally sponsored programs that allow individuals to buy a house with $0 down and at loan terms of I percent annual interest. The Government Benefits Book only contains information about a federal program available through the United States Department of Agriculture s Farmers Home Administration that allows families with moderate incomes to buy houses in rural areas of less than 10 000 people with $0 down and at loan terms of I percent annual interest. Therefore, the representation set forth in paragraph twenty-one was false and misleading. Complaint 118 F.T. COUNT VII PAR. 23. Respondents have disseminated or have caused to be disseminated advertisements for the Government Benefits Book including but not necessarily limited to the Government Benefits Infomercial. These advertisements contain the following statements: (James Wyattl George, you won t believe me, your audience won believe me. You can get almost $5 millionnalmost $5 milion if you use all of the sources in that particular book (the Government Benefits Books. Let s be more realistic.

rGeorge Readings Let s be more realistic. What is the average cash return or cash take?"

(James Wyatt) The book is designed if people wiII buy the book and then use it, and that s the secret is using just like Mary did, about $87 500.

(Exhibit A) PAR. 24. Through the use of the statements contained in the including butadvertisements referred to in paragraph twenty-three, not necessarily limited to the advertisement attached as Exhibit A , thatrespondents have represented, directly or by implication consumers who made use of the Government Benefits Book would realize an average of $87 500 in government grants and loans. PAR. 25. In truth and in fact, consumers who made use of the Government Benefits Book would not realize an average of $87 500 in government grants and loans. Therefore, the representation set forth in paragraph twenty-four was false and misleading. COUNT VII PAR. 26. Through the advertising and dissemination of the Government Benefits Infomercial, respondents have represented directly or by implication, that the Government Benefits Infomercial was an independent television program and was not paid advertising. PAR. 27. In truth and in fact. the Government Benefits Infomercial was not an independent television program and was paid commercial advertising. Therefore, the representation set forth in paragraph twenty-six was false and misleading. PAR. 28. The acts and practices of respondents as alleged in this complaint constitute unfair or deceptive acts or practices in or WYATT MARKETING CORPORA TIOr\, INe.

Complaint affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.

EXHIBIT A TRANSCRIPT OF THE JAMES R. WYATT INFOMERCIAL FOCUS ON SLJCCESS"

George Reading, Host: Do you pay taxes? How many of you don t pay any taxes? How would you like to pay taxes to the government and get cash back? That's what this program is all about - 101 Ways To Get Cash From the Government.

\Velcomc to "Focus on Success Blind Speaker: Welcome to another edition of "Focus on Success. The program that takes your financial success seriously. Today s program will feature James Wyatt, author publisher, entrepreneur who will show you 101 ways to get cash from the government cash for business education, real estate and more. Here s our host George Reading.

George Reading: 101 Ways To Get Cash From the Government. I know it sounds too good to be true, doesn t it? Let's meet the man who says it is -- James \Vyatt author entrepreneur, publisher. Is that -- is that you. James Wyatt: lt' s good to see you again, George. George Reading: I can tel!, I can feel people out there saying okay, come on James Wyatt, you re suggesting there s cash in the government just for the asking.

James Wyatt: Sure, I mean, we pay as taxpayers money into the system and that money is used back for its citizens, why can t we consider ourselves a citizen and go get some of it back.

George Reading: Okay, why does the government do this? James Wyatt: \Vell, basically the government is involved in it for a variety of different reasons, I mean, this economy is based upon income being produced by businesses. So there s business loans available to people to start ncw businesses or expand their current husinesses and the ng and the short of it is George, is really the more money that can be gencr3ted by businesses, the more taxes are going to be created so the more jobs that are created the larger the government can get. So all I'm FEDERAL TRADE CO'vMISSION DECISIONS Complaint 118 FTC. saying is that if you want some of the money you been paying all your life for taxes, go out and get it. George Reading: WeII, okay, how do you do that? Is it hard to gets James Wyatt: No. It's not that difficult. The problem is there s so many agencies that have so much money trying to give it out to the public, we don t have one ccntral government agency we can go to and say I'd like to star a business, I'd like to go on welfare, I'd like to get a house, I'd like to get some of my veteran s benefits, I'd like some employment services like to learn how to, in fact, become a doctor. Also, educational type benefits. There s no one central agency we can go to. We have to go to a variety of different agencies, and that's what creates a problem.

George Reading: I can hear a lot of people now saying you have now Jim, yeah, you have to be a minority, to be a low income person in order to qualify.

James Wyatt: George, that s not the case. In fact, those are called entitlement programs and they only in fact represent about 10% of the money the government gives back to people. So, yes, there are those types of programs, but that s not the rule of thumb.

George Reading: Okay. I understand in your book that you have low interest rate housing loans that amount to a I % interest loan.

James Wyatt: Sure. That s how I started as a businessman. George Reading: You ve got to be kidding. James Wyatt: , I'm not George. The problem is that there s a variety of government agencies that provide housing to the people of the Cnited States. We typically think of the Federal Housing Administration, the FHA , as a single source of funds, however, there s a program called, through the United States Department of Agriculture, through what they call their Farmers Home Administration agency and they ve got a program to where you can qualify for a house for $0 down and 1 interest, and I as a general contractor have built 3 000 of those homes and sold them to people back in America. 0 down and 1 % interest. So it s not a fluke. As a matter of fact, this year I think the government, in that particular agency, the Farmers Home Administration, has a $5.7 billion program strictly for housing of people. You can buy a single family home as well as apartments.

George Reading: So it s not a fluke.

James Wyatt: No.

George Reading: T heard you right - 0% down: 1 % interest. James Wyatt: For 32 years, 3 I days. George Reading: All right, where do you get this information? WYATT MARKETING CORPORA non, INe.

Complaint James Wyatt: You have to go to the government agency and ask for it. The problem is...is the government itself is not a good public relations person. They aren t. They don know how to disseminate information back to people. You know, it s sO...(unclcar).

George Reading: But couldn t anybody simply ask for this information? James Wyatt: Well, you got to know which agency to go to. We see about them in the newspapers, we hear about them, we hear even about other people doing it. Let's take an example for housing, and there s Jots more than housing in this book. You ve heard about a 0 down - 1% interest for the first time in your life George. You have been in newscasting for how many years? George Reading: More than I care to admit. James Wyatt: But that s the first time you ve heard about it. Now what happens, we have the FHA, the Federal Housing Administration, we got the Farmers Home Administration (FHA) so people call the FHA and say I want a 0 down - 1 % interest rate and the FHA says someone is lying to you and hangs up the phone. You ve got to call the C. S. Department of Agriculture Farmers Home Administration and they ll say yes we ve got the program and I'l send you out information.

George Reading: So you got to know where to go. James Wyatt: You got to know where to go and what questions to ask. George Reading: Then you get back what? James Wyatt: You get back information from the government that reaJiy shows you what to do.

George Reading: \Vell you re talking about what, pounds and pounds of information.

James Wyatt: No. :'o. I think what you re talking about is a variety of information that s available for people. J mean people don t have to buy my book to, in fact, learn this information. What I have done is that 1 have got some books over there which I saw you Jooking at. Let's look at the books the government send us. Okay.

George Reading: Pretty hard to avoid them. Look at the size of them. James Wyatt: George. It' s not I , 2 or 3 little pamphlets you get from the government. You can see over here J brought the pamphlets with me. It s actually 26S books each year you have to research and it s not free. That subscription to that which you pay to the lJ. S. Superintendent of Printing is $345 per year. Now there is lso, OOn pages of information you ve got to research to get to what we got here. Now this is a 100 page book that condenses what s in that infonnatiol1. It takes out all attorney talk and lawmaking talk and it puts into normal English Complaint 118 FTC.

where someone can understand, how do you get the money.

George Reading: Okay, okay. But Jim, we also know that laws and programs arc changing all the time.

James Wyatt: Absolutely.

George Reading: Now how can onc book like this keep up with all the infonnation you need and keep you current on programs? James Wyatt: That's a good point. Now we get this subscription at our office.

George Reading: All right.

James Wyatt: One day, every day, somebody researches this for our company and tells us what changes have, in fact, taken place. So somebody has a question on this, aji they have to do is just call our hatline and we will research and tell them in what way the new law has been changed. Now the thing that has become even more confusing is let s say there s a new law or change to the law and it says okay, we re changing the law that was developed in 1937 and it tells us right here in this book that we received today. Now what we have to do is take this information, go research the statute from 1937 to figure out what the law really in fact was. So you can either use a short circuit system which the book talks about or you can spend about 5 hours a day to research this so you can get the same information that comes in this book. Time is money.

George Reading: Yes. Of course. Some of the headings in your book are absolutely fascinating.

James Wyatt: \Vell, those are the headings that are given to us by the government.

George Reading: Pretty fascinating. "How To Get Up To $5 Million To Start A Business.

James Wyatt: Yes, that's right. It' s true. It's for a person who wants to start a business or expand an existing business that they have.

George Reading: What kind of money do you need to get into that? James Wyatt: It doesn t cost you a dime. You go in and apply through what is called a business plan, George. Okay, you take a business plan in to this government agency and they will approve your business plan and give you the money and say no you need have to clean it up, you missing it over here and they even give you the consulting services for free.

George Reading: HO\v long does it take you? James Wyatt: Okay, it takes 47 days. Interest rate is 3 percent to 7- 112 percent.

George Reading: Criteria? Complicated? WYATT MARKETING CORPORATION, INe.

Complaint James Wyatt: Criteria is not. How many people are going to be employed, what is your product going to be, is it safe and sane and also will it employ jobs and will they be able to create (unclear).

George Reading: Give me the interest figure again. James Wyatt: 3 to 7% George Reading: On 55 miIIion James Wyatt: And anybody here in the T. V. audience who has a good idea for business can go in and get that money. George Reading: How to get the SEA to guarantee your rent? James Wyatt: That's right. The SEA will come in and guarantee your landlord your rent that you re supposed to in fact pay. George Reading: Free college money for veterans? James Wyatt: Yeah. Now isn t that interesting? George Reading: s very interesting. James Wyatt: We have been hearing how educational tuition and grants for students have been cut back. We hear this blitzed on the media and you know why, nobody comes in and applies for the money that's there.

George Reading: And you personally got money back? James Wyatt: Yes. r have. I have received over $180 million in my life.

George Reading: You personally know anybody else who got money back"

James Wyatt: Oh sure -- absolutely -- several people. As a matter of fact, the government gave away $37. 5 billion last year and I brought onc of those people with me today. George Reading: AJI right. We !! take a minute and come right back and meet that person.

(Commercial Break): Stay tuned for hook 101 Ways to Get Cash From Government) Visual text IFact: the U.S. government has 110 billion dollars to lend or give away!) (Do you need money to start a business? Go to college? Buy a house? Invest in property "J I 1-800-332-6200) Blind Speaker: Fact: the United States government has over 110 bjJJjon dollars to lend or give away this year, how much of that 110 billion will you get this year from Uncle Sam. If you need money to start a business, go to college, or a vocational school to buy a house. buy an investment property, or want to save money on your taxes this year, this man can help. Jim Wyatt, noted international entrepreneur, publisher and best selling author has written " 1OJ Ways to Get Cash From the Government This easy to understand book tells you where you can get money for a business, for college, for employment, real estate and social services. And there is a bonus chapter especially designed to show American veterans Complaint 118FTC their new benefits. Don t delay, order today by calling this toll free number. And if you order today, you receive a bonus cassette tape by Jim Wyatt, forty-nine ninety-five plus three dollars shipping and handling is all it takes to get information that could return thousands of dollars to you. Call now, have your charge card number ready. Sorr no C.O.D orders. California and New York residents add sales tax, or you may send check or money order to this address. George Reading: Okay, Jim, let's meet your guest. James Wyatt: Good, let me introduce Mary Brown to you. George Reading: Mary, thanks for joining us. Sit down. How did you two meet? James Wyatt: I got to tell you the story, About two years ago I get this nice cail from this nice young lady saying Jim we would Jike you to come to college and talk about real estate financing because I go out and lecture at schools. It happened to be that Mary Brown was at the end of that telephone line. When she graduated I asked her to go to work for me. That s how we met.

George Reading: How much cash, Mary, did you get back? Mary Brown: I got a total of S28, OOO as a grant from the City of Crescent to help build an apartment complex there. So s a 20-unit complex and I went in and asked for it -and it was just sitting there. No one had even asked for it and they were going to have to send the money back to the state because nobody was using it and no one knew it was available, James Wyatt: Isn t that incredible? George Reading: Yeah.

Mary Brown: And after working with Jim I found out, . . he just exposed me to the idea that it was available, to go and look it up.

George Reading: Incredible, but complicated? James Wyatt: , not really. George Reading: How long did it take you? Mary Brown: Well, we got a commitment on it within 2 or 3 days. Wel in fact, the first time \-ve went in and talked to the city manager he gave us a commitment at that time. He was anxious to give the money out. If he didn t give the money out, he \vould have lost it, and he would not have been able to help build up the city and get some future income.

George Reading: 2 or 3 days to get the commitment. How many days to get the money -- weeks, months, years? Mary Brown: , probably. No it only too, urn, . So we came up with the idea in Aprij and then we were actually funded about 2 months later and of course, that was after we got our plans a11 drawn and so it was - WYATT MARKETING CORPORA non, INe. 101 Complaint James Wyatt: They weren t ready for the money. They could have gotten it sooner for they were ready for the money earlier.

Mary Brown: Yeah.

J ames Wyatt: How long has it been since YOll made $28 000 in 2 days. How many people in America would like to make that? George Reading: Never, never. All right. If you could tap all 101 ways to get cash from the government, Jim, how much cash could you get? James \Vyatt: George, you won t believe me, your audience won believe me. You can get almost 55 million -- almost $5 million. If you use all of the sources in that particular book. Let s be more realistic.

George Reading: What is the average cash return or cash take? James Wyatt: The hook is designed if people will huy the book and then use it, and that s the secret is using it, just like Mary did, about $87 500.

George Reading: 587 500.

James Wyatt: That's a pretty good return on buying a book. George Readi ng: Not a bad return for a book that costs less than S50. The book-- James Wyatt: Okay.

George Reading: Some of the chapters are intriguing-- James Wyatt: Okay, its broken down alphahetically. George Reading: Too good to be true. How to get up to $400 per week for not working. Come on. They're going to make you laugh. Right? James \Vyatt: I know, but those are taken from the heading of the government literature. I mean, I didn t create them. Some of them I created.

George Reading: Give me an example. How do you get $400 per week for not doing anything? James Wyatt: There s several ways. There s several different ways. What about disability insurance, what about unemployment insurance? George Reading: Well, I can t qualify for either one. James Wyatt: Why not George Reading: Because I'm not disabled and I'm not unemployed. James Wyatt: What happens if you are fired tomorrow? George Reading: Okay - you take it from there. James Wyatt: So you ve got seven varieties, I mean, to get 5400 on a weekly basis by not working. But you know what happens? George RCClding: I never wanted to get fired before, but you are making It very cnticlng.

James Wyatt: , I know and a lot of people can t live on $400 , but s there available for you and I think most people Complaint 118 F.TC. know about those type of things. What s exciting about that particular chapter is Jet s say that you want to go overseas to work. The government has a source in the Bureau to where, in fact, they will hire you, ship you across to any country you want and pay you a salary to work there. If you want to change career and I know you don t want to do this, but if you want to change from newscasting and being an anchor person recognize let's now say you want to become a ditch digger, there s a transformation that takes place. Go in for some free counseling n doesn t cost you one dime and they will do a career change for you free of charge George, It' s there, just nobody knows where to go to get it.

George Reading: Quote "How To Buy A House For $1. James Wyatt: $1.

George Reading: $1.

James Wyatt: Okay, I will tell you the program, It is a program run by HUD, Housing and Urban Development and called Urban Home Study and the program s been around since 1846, It's not a new program, $1. The maximum you would pay for a house under that program is $2 500 George and when 1 say $1 or 25 -- that s not the down payment, you have bought it for that amount of money and there s 126 cities within the United States that fun the program, George Reading: It gets even better, doesn t it? Here s one that says How You May Be Entitled To A $10,000 Refund. James Wyatt: Yep. Do you know how many people in America overpay might be entitled to that'! Might and I put might because not everybody is, but one out of every three taxpayers in the United States is overpaid in this Social Security Administration system. We give you the telephone number and address of the agency to call. They win send out and tell you, in fact, whether you in fact owed money hack. $ I 0 000 bucks. They will look it up -- they tell you -- it's simply done by a telephone call and simple signature on a form and they show you how to do it.

George Reading: All right. "Collect Social Security Before Age 65. James \Vyatt: That s exactly right. George Reading: Full benefits.

James Wyatt: That s right. Full benefits before age 65. You didn know that, did you? George Reading: No I didn t know that. 1 suspect a lot of people didn know that.

James Wyatt: f'' , most people in America don t know that. George Reading: How do you do that short of being disab1cd" WY A TT MARKETING CORPORA non, INe. 103 Complaint James Wyatt: You ask. You ask, George. I mean I know it sounds too good to be true, but we tell you the agency to call up and say this is what I'm going to do and they will even tell you back, George. They ll tell you how and when you can retire to make the type of income levels you want to.

George Reading: Now I have been told that, for instance, that the charitable work and I'm sure others have too, that charitable work can t be used as a tax deduction. And I notice here you have a chapter that says " Charitable Work As A Tax Deduction, James Wyatt: That s in the chapter "How To Save :voney With The IRS.

George Reading: Have I been misinformed? James Wyatt: You have been totally misinformed. George Reading: How do I do thatO James Wyatt: Do you ever do any broadcasting at all for charitable organizations? George Reading: Absolutely.

James Wyatt: Okay. Why don t you send them a bill and then when you, when they ve in fact, received the bill they pay you, and you give it back to them as a donation. Have you ever done that? George you have good CPA' s, you have good attorneys around you. They did not tell you that information, did they? George Reading: Well, not good enough. James Wyatt: What you do when YOLl get that charitahle organization you write it off on your income tax and, therefore, the government helps you pay less money.

George Reading: Well, that makes sense. James Wyatt: Sure it does. Sure it docs. George Reading: Leases. "Leases That Save You Money. James Wyatt: Yeah. With the 1986 Tax Refonn Act there are some basic laws that have hit hard home and every American in the United States is paying taxes and we have a system in there that the IRS has, in fact, approved to where if you lease certain items you can totally write it off and have the government, in fact, pay it for you. George Reading: This onc intrigues me. "Free Medical Benefits For Life. " Now that s a big question.

James Wyatt: Yeah.

George Reading: LToJ Anyhody who is growing older? James Wyatt: No. What that is is kind of a bonus chapter, if you will. You ll notice that there s more than 10 I \vays to make money. What it is is that there s a bonus chapter that talks specifically about the veterans in the United States that have been in the service for greater than 191 days. 181 days, excuse me. They are entitled to free medical Complaint 118 FTC.

benefits for the rest of their lives, but nobody tells them about it.

George Reading: Jim, hang tight.

James Wyatt: Thank you. I get excited about it. I'm sorr. George Reading: In one minute we ll be back with questions from the audience.

(Another commercial for Book 101 Ways. ..

Visual text rWant to start a business? Get a higher paying job? Retire") (Get a par of the government giveaway.j ,Start a business Expand Current Business Money for college Get a hetter Job) ,Get $10,000 back save taxesJ Blind Speaker: Do you want to start a business? Get a higher paying job, buy a house or investment property or retire this year. Well jf you do, you need Jim Wyatt s best selling book " 101 Ways to Get Cash From the Government. Jim Wyatt, international businessman, publisher and best scJling author has just written this exciting new book that will show you how you can get a part of the 110 billion dollar government giveaway this year. He shows you step by step how to get money from the government to start a business where to get money to expend your current business, where to get money to go to college or to go to a vocational school, how the government will help you to get a better job. How you can get up to 10,000 doBars back from social security and how to save taxes this year. He also has included a special bonus chapter just for veterans describing their benefits from the newly formed U.S. Department of Veterans Affairs. If you are tired of paying taxes to the government and would like to Jearn how to get those tax dollars back, place your order today by calling this toll free number. Forty-nine, ninety-five plus three doUars shipping and handling will get you information that could change your life. Order now and you receive a free copy of Jim \\Tyatt's cassette tape on getting cash from the government. You may send a check or money order to this address. California and ew Yark residents please add sales tax.

Questions From The Audience George Reading: Okay, I can tell from the faces there are questions. Question: I am a part-time student and I work part time also and I heard you mention something about getting a home for S 1. I'd he really interested in purchasing J home for , but 1 can t come up with a down paymem right now. WYATT MARKETING CORPORATION, INe. 105 Complaint Who would I get in touch with to tind out about HUD-is that what you call that? James Wyatt: That's one agency. The Housing and Urban Development -- that's known as HUD. The book gives you 7 ways to buy a house for nothing down. \With programs sponsored by the United States Government o down - 1 % interest. Urban Homesteading -- Sl to totally buy the house. We got a variety of other programs that are in there that require nothing down. Now, see I know that people laugh about this, but I've built 3 000 houses for people in America where their total down payment was 50 down and their interest payment was I %. On a $60,000 house - - principal interest, taxes and insurance your monthly payments are \27 bucks. That s cheaper than rent and so anybody in America that sits back and says I can t afford a house is nonsense. What YOll can t afford to do is not to buy the book. I'm sorry but that's the truth.

George Reading: Anybody who wants to start a business, expand a business? Question: Yes, I live in the Sacramento area and I'd like to move my business up into the Lake Tahoe region and I don have any connections of banks or credit there. Is there something that can help me in the book.

James Wyatt: Yeah. Okay. In the first chapter what we ve done is we Jisted employment services. Priorities like businesses. education so it's alphabetically done. The first chapter has 21 different ways to get money to start a business. Whether you re going to be in the metropolitan area or a very very rural area. One of the most exciting things that s happened in my opinion, last year . with the government is in rural areas. They are now encouraging people to move to rural areas to produce jobs. So they got a S500 000 grant program available that only became available two months ago and you get up to $500 000 and you never have to pay the money hack. If that s not encouragement to start a business, I don know what is. 500,000 and you never have to make one payment for the money. So yes, plenty programs. I am currently a senior in high school right now and Question: college finances are going to be a big problem in the coming year- and you mentioned something about educational loans from the government'? James '0lyatt: In the second chapter we talk about educational services that are available. All the way from preschool all the way to getting your doctorate degree or becoming even a medical doctor. You ve got 4 different programs to choose from. One of them is 106 FEDERAL TRADE COMYlISSION DECISIONS Complaint 118 FTC.

caned a grant where you can get up to S 11 ,000 a year to go to school per year and you never have to pay the money back at all. Then there s another one where there s a student Joan at 3% interest. Then there another onc at 7% interest and even if you have payments you don t get a grant to go to school -- you don t have to pay any payments at all until you graduated and you have up to 10 years to repay the loan. So anyone who wants to go to school it s there. The problem is nobody came in and applied for the money, therefore, the budget was cut and then nobody came in and everybody was being told in the newspapers there s no college money so nobody even came in and applied for more money. So there s about 3 billion dollars of unused money just last year alone strictly because of media hype.

George Reading: How can you know where you can qualify for a grant or a loan? James Wyatt: You just got to go in and ask, George, it s based upon need. It's based strictly upon need - how much is it going to cost you to go to school, how beneficial will your education be to society and it's just going and asking the questions. See the problem is, George, is nobody in America knows which agency to go to get it. That's what the book talks about. It s not a get rich quick book. What it is is a resource book. It tells you which agency to go to, then YOll go in and ask the infonnation. \Vhat you get in those agencies it is their responsibility to give you the money and that's what they do.

George Reading: s not a "How To Book. " It s an " Idea Book. James Wyatt: It' s nothing more than a resource book that shows you 101 ways to get cash back from the government. George Reading: Okay. I saw a hand over here. Yes. Question: The government money that s not applied for -- is that accounted for in government spending? Is it in the budget"

James Wyatt: That s a good question. Because sometimes nobody knows what happens to it. Okay? In all honesty we have to tell you that. \Ve all heard it in government. If you don t use it, you lose it. So if a government agency, I know one state agency here in California that got $159 million from the federal government to produce housing in California. They spent $2 million of it and gave back $157 million because nobody came in and applied for it. $157 milion of non interest money. You never have to pay back -- they just gave it to you.

George Reading: Okay. Let's go up... WYATT MARKETJNG CORPORATION, INe. 107 Complaint James Wyatt: That s a tragedy.

(unclear), here, I saw aGeorge Reading: Let s go to the top row -question up here.

I'm interested in expanding my business. Is there likeQuestion: a limit at all to any kind of loan I can get from the government in the money that I need to expand? James Wyatt: Y cah. There is hasically some maximum levels and there s some minimal levels. Generally and typically to expand a business the maximum loan you can receive 000 so is $6 million. The minimum, however, is $25 never ask for $25 000 or Jess because you ll get denied. That within itself is worth watching this program. Question: Is there an agency you can contact to help you with hearing aid problems? James Wyatt: There s several. There s two agencies off the top. First of all are you a veteran? Questioner: Yes. Yes.

James Wyatt: Okay, then all you have to do is call the V A because you ve got free medical benefits for the rest of your life and they'll buy it for you. If that s not good enough, are you 62 years of age or older? Questioner: Yes. Yes.

James \Vyatt: Then go to the Social Security Administration because they buy it for you as well. So that's two sources for a hearing aid.

George Reading: You don t have to pay it back. James Wyatt: We don t actually talk about hearing aids. (in the book") George Reading: That's a gift, you don t have to pay it back? James Wyatt: That s a gift.

George Reading: More questions? Question: If you want to start a business, don t you have to prov' to the government that your business plan will provide a profit and hire people? James Wyatt: That s a great, great question and I'm glad somebody asked it. You know this money its not hard to get, but you need to show that there s a need, I mean that's only right. \Ve re not just going to give this money away freely and you as taxpayers, I'm sure you don t want that to occur. So what you need to do your application is basically a business plan. J\ow most people in America do not know how to write a business plan. I consult for major corporations in the United States and they don t have a business plan so you know what they , these government agencies, the four government agencies I talked about in the book, they all have people that will show you how to write it for free and you never even have to do it. They will, in fact, show you s the how to write the business plan and that Complaint 118 FTC.

application, hut I'm Dot talking about how to write a business plan, you know, to get government contracts I'm talking about writing a business plan to get the working capital necessary to start a business. George Reading: Jim Wyatt, thanks a lot for being our guest tonight. James Wyatt: Well, thank you for having me back. I appreciate it. George Reading: And thank you, you ve been a great audience and thank you, you ve been listening to another edition of focus on success.

(Commercial for " 101 Ways to Get Cash From the Government " I Visual text (Fact: Average J 977 income tax paid $1647. 911 react: Average 1987 income tax paid $3628. 33) (Fact: 220% increase) (Fact") (Get tax dollars baekl lJames R. WyattJ (Want to start a business? Receive a scholarship? Get a high paying job? Retire?J Blind Speakcr: Fact the IRS report that the average amount of income taxes paid by each working adult paid in 1977 was $1,647 and ninety-one cents.

Fact: the IRS reports that the average amount of income taxes paid by each working adult in 1987 was $3 629 and thirty- three cents, an increase of two hundred twenty per cent in ten years. Have your wages gone up two hundred twenty per cent in the last ten years to keep pace with these income tax increases. If you arc paying taxes to the government and would like to know how to get some of that money back through the government s giant giveaway and Joan programs or just feel you re not getting your money's worth. You need this man s book today. If you want to learn how to get money to start a business, expand your current business, get a government scholarship to go to college get a high paying job directly from the government or if you re planning to retire this year or if you just want to save taxes next year. You need this hook now. How much can you expect to get back? You can get up to $87 500 in just ninety days by using this simple and easy to understand book. It comes with a ten day money back guarantee. Order your copy now by calling this toll free number. Please have your charge card number ready. California and :\ew York residents must add state sales tax. Sorry no C. D. orders. Or you may send a check or money order to P. O. Box 2937 South Hampton, New York 11969. order now and you ll receive a free copy of Jim Wyatt s cassette tape about getting money from the government.

Visual text !The 180 million dollars Mr. \Vyatt mentions in this program refers to the construction and development WYATT MARKETING CORPORATION, INe. 109 Complaint funds he and his corporation have received since 1968. This figure does not include his volunteer services to state, counties and cities which have received additional government funding.

LJames Wyatt, producer; Tom Thompson, director; George Reading, host; Scott Eckcrn, community director; Bob O'Conner, commercial announcer, Ross du Clair, technical director; Dan Alexander, editor; David Evans, graphic designer; BilJ Gary, floor designer; Dan Q' Reily, Camera; Brent Hamilton Camera; David Bunge, lighting director; Scott NciJ lighting; Matt Flynn, audio; Tyler Thompson, original music; Phillip Gross, gaffer; Guy Ortoleva, Project Coordinator J rSpccial Thanks to: Sacramento House of Furs, New York Diamonds, Comm Artsl Talent, Street of Dreams Presidential Limousine.

LProduced at the Alexander Media Services Broadcast Center. A WMC Production.

ITHE DIALOGUE BELOW OCCURS AS THE VISUAL TEXT ABOVE IS BEII'G SHOWN TO THE VIEWERSJ George Reading: Collect Social Security before age sixty-five? James \\lyatt: That's exactly right. George Reading: fuji benefits? lames Wyatt: Full benefits before sixty-five. You didn t know that did you? George Reading: No. I didn t know that. lames Wyatt: Let s say that you want to go over seas to work. The government has a source and a bureau to where they will, in fact, hire you, ship you across to any country you want and pay you a salary to work there. If you want to change a career and I know you don t want to do this, but jf you wanted to change from newscasting and being an anchorperson recognize let's say you want to become a ditch digger. There s a transformation that takes place, go in for some free counseling and doesn t cost you one dime and they will do a career change for free of charge George. Its there, its just nobody knows where to get it.

George Reading: \Vell. how to buy a hOllse for a dollar? James Wyatt: A dollar.

George Reading: A dollar.

James Wyatt: Okay, I'l tell you the program, its a program run hy HCD, Housing and Urhan Development. Its Glued urban homesteading and the program has been around since 1846. Its not a new program. One dollar, the Dccision and Ordn 118 F.T. maximum you pay for a house under that program is twenty.five hundred dollars George, and when I say a dollar or twenty-five that s not the down payment, you have bought it for that amount of money and there are one hundred twenty.six cities within the Coited States that run the program.

DECISION AKD ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the Wyatt Marketing Corporation Inc., a corporation ("respondent ), and the respondent having been furnished thereafter with a copy of a draft of complaint which the New York Regional Office proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violation of the Federal Trade Commission Act; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order an admission by the respondent of all jurisdictional facts set forth the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, or that the facts as alleged in such complaint, other than jurisdictional facts, are true, and waivers and other provisions as required by the Commission s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the said Act, and that a complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty (60) days, now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings and enters the following order:

1. Respondent Wyatt Marketing Corporation, Inc. (formerly doing business as James R. Wyatt & Associates and Cornerstone Publishing) is a corporation organized, existing, and doing business under and by virtue of the Jaws of the State of California, with its WYATT MARKETING CORPORA TION, INe. 111 Decision and Order principal place of business located at 4231 Pacific Street, Suite 4, in the City of Rocklin, State of California.

2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

ORDER DEFINITION For purposes of this order grant shall mean any money or item of value that is given or awarded without a concomitant obligation to repay or to provide goods or services.

It is ordered, That respondent Wyatt Marketing corporation, Inc. a corporation, its successors and assigns, and its offcers, agents representatives, and employees, directly or through any partnership, corporation, subsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion, offering for sale sale, or distribution of any product or service in or affecting commerce, as " commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from selling, broadcasting, or otherwise disscminating, or assisting others to sell broadcast or otherwise disseminate, in part or in whole thc programlength television advertisement entitled "Focus On Success " for the book entitled 101 Ways to Get Cash From the Government. II.

It is further ordered That respondent Wyatt Marketing Corporation, Inc., a corporation, its successors and assigns, and its officers, agents, representatives, and employees, directly or through any partnership, corporation, suhsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion offering for sale, sale, or distribution of any product or service, in or affecting commerce, as "commerce " is dcfined in the Federal Trade Commission Act, do forthwith cease and desist from representing, in any manner, directly or by implication, that: Dccision and Order 118 FTC. A. The Farmers Home Administration has or had $5.7 billion in loan money available for individuals for the purchase of single family homes and apartments;

B. The book entitled 101 Ways To Get Cash From the Government gives the reader a telephone number to call to find out whether she or he has overpaid into the Social Security System and to determine whether she or he is entitled to a refund from the Social Security Administration;

e. Individuals can or could retire before age 65 and still collect full Social Security retirement benefits;

D. There is a federal agency that will or would loan an individual with a good idea for a business up to $5 million to start a business or expand an existing small business at terms of 3 percent to 7.5 percent interest;

E. There is or was a federal government grant program available for college educational purposes under which a student mayor could obtain up to $11 000 annually;

F. There is or was a government student loan available at 3 percent interest;

G. The book entitled 101 Ways To Get Cash From the Government contains information on seven different federally sponsored programs that allow individuals to buy a house with $0 down and at loan terms of I percent annual interest; and H. Consumers who make use of the book entitled 101 Ways To Get Cash From the Government realize or ean realize an average of $87 500 in government grants and loans.

It is further ordered That respondent Wyatt Marketing Corporation, Inc., a corporation, its successors and assigns, and its officers, agents, representatives, and employees, directly or through any partnership, corporation, suhsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion offering for sale, sale, or distribution of any product or service, in or affecting commerce, as " commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from making any direct or implied representation concerning: WYATT MARKETTj\G CORPORA TTON, INe. 113 Decision and Order A. The availability of grants, loans or other benefits from any source for any purpose;

B. Whether any book or other writing contains information about a particular subject or topic;

e. The teffs or conditions upon which any person, firm, agency, or institution will award a grant, loan or other benefit to any other person, firm, or organization;

D. The teffs or conditions of any government or private business opportunity, business assistance program, grant program educational program, loan program, housing procurement or other procurement program; or E. Any method or technique for starting, operating, or financing any profession or business;

unless, at the time of making such representation, respondent possesses and relies upon competent and reliable evidence that substantiates the representation; provided, however, that whenever respondent represents that any book or other writing contains information about a particular subject or topic, subpart B. shall not be construed to require respondent to possess and rely upon evidence that such infoffation in said book or other writing is true, but only that it is present in said book or other writing. IV.

It is further ordered That respondent Wyatt Marketing Corporation, Inc., a corporation, its successors and assigns, and its officers, representatives, agents, and employees, directly or through any partnership, corporation, subsidiary, division, or other device, in connection with the advertising, promotion, offering for sale, sale or distribution of any product or service, in or affecting commerce, as commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from creating, producing, selling or disseminating:

A. Any advertisement that misrepresents, directly or by implication, that it is not a paid advertisement; and B. Any commercial or other video advertisement fifteen (15) minutes in length or longer or intended to fill a broadcasting or cable casting time slot of fifteen (15) minutes in length or longer that does not display visually, in a clear and prominent manner and for a length Decision and Order 118 FTC. of time sufficient for an ordinary consumer to read, within the first thirty (30) seconds of the commercial and immediately before each presentation of ordering instructions for the product or service, the following disclosure:

THE PROGRAM YOU ARE WATCHING IS A PAID ADVERTISEMENT FOR (THE PRODCCT OR SERVICEj"

Provided that, for the purposes of this provision, the oral or visual presentation of the telephone number or address for viewers to contact to place an order for the product or service shall be deemed a presentation of ordering instructions so as to require the display of the disclosure provided herein.

It is further ordered, That for five (5) years after the last date of dissemination of any representation covered by this order, respondent or its successors and assigns shall maintain and upon request make available to the Federal Trade Commission for inspection and copying, within five (5) business days of such request: A. All materials that were relied upon in disseminating such representation; and B. All tests, reports, studies, surveys, demonstrations or other evidence in their possession or control that contradict, qualify, or call into question such representation, or the basis relied upon for such representation, including complaints from consumers. VI.

It is further ordered That respondent shall: A. Within thirty (30) days after service of this order, provide a copy of this order to each of respondent's current principals, officers directors, and managers, and to all persons, agents and representatives having sales, advertising, or policy responsibility with respect to the subject matter of this order: and B. For a period of ten (10) years from the date of entry of this order, provide a copy of this order to each of respondent s principals officers, directors, and managers, and to all personnel, agents, and representatives having sales, advertising, or policy responsibility with WYATT MARKETING CORPORATION, INe. lis Concurrng Statement respect to the subject matter of this order who are associated with the respondent or any subsidiary, successor, or assign, within three (3) days after the person assumes his or her position. VII.

It is further ordered, That respondent Wyatt Marketing Corporation, Inc. shall notify the Federal Trade Commission at least thirty (30) days prior to any proposed change in its corporate structure, including but not limited to dissolution, assignment, or sale resulting in the emergence of a successor corporation(s), the creation or dissolution of subsidiaries or affiliates, the planned filing of a bankruptcy petition, or any other corporate change that may affect compliance obligations arising out of this order. V 11 It is further ordered That if the respondent is no Jonger the subject of the Eastern District of California s Wyatt Marketing Corporation, Inc. Chapter 7 bankruptcy proceeding (No. 90-26755- 7), it shall within sixty (60) days after it has ceased to be the subject of such proceeding, file with the Federal Trade Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order.

CONCURRING STATEMENT OF COMMISSIONER ROSCOE B. STAREK, II Although I have voted to approve final issuance of the complaint and consent order in this matter, I have reservations about the proviso to one of the substantiation requirements set forth in Part III of the Order. That proviso is designed to accommodatc thc Commission Mirror Image Doctrine, which provides as follows: The Commission, as a matter of policy, ordinarily will not proceed against advertising claims which promote the sale of books or other publications: Provided, The advertising only purports to express the opinion of the author or to quote the contents of the publication; The advertising discloses the source of statements quoted or derived from the contents of the publication; and the advertising discloses the author to be the source of opinions expressed about the publication. Whether the advice being offered by the publication will achieve, in fact, the results claimed for it in the advertising will not be controlling if appropriate disclosures have been made. This policy does not apply, however, if the publication, or its advertising, is used to promote the sale of some other product as part of a commercial scheme. 116 FEDERAL TRADE COYIMISSIO'" DECISIONS Concurring Statement 118 F.TC. Advertising in Books, Enforcement Policy, 36 Fed. Reg. 414 (1971). The order proviso in Part II states as follows: (WJhenever respondent represents that any book or other writing contains information about a particular subject or topic, fthe referenced substantiation provisions shall not be construed to require respondent to possess and rely upon evidence that such information in said book or other writing is true, but only that it is present in said book or other writing. While the Mirror Image Doctrine is designed to accommodate the Commission s enforcement authority with the protections of the First Amendment, it is at heart a statement of the Commission enforcement policy, how the Commission intends to exercise its prosecutorial discretion in cases involving advertising of books and publications. Not all Commission cases involving advertising for books and publications have included a Mirror Image Doctrine proviso. ' Including such a proviso in an order may raise enforcement difficulties. An inventive respondent could specifically dcsign a deceptive scheme to bring its actions within the protection of a Mirror Image Doctrine order proviso. In addition, a court enforcing the order might construe the proviso more favorably for the defendant than the Commission considers proper.

Further, I am concerned about the particular language of the proviso in thc order in this case. It does not rcquirc the respondents to make the disclosures required under the Mirror Imagc Doctrine and it does not includc the exemption from protection for publications used to promote the sale of other products. The ability of a respondent to circumvent the proviso would be limited if the proviso more closely tracked the Commission s Mirror Image Doctrine. Accordingly, in order to limit the possibility that our orders will protect deceptive speech that is not First Amendmentprotected, I would prefer that, if safe harbors designed to accommodate the Mirror Image Doctrine are used in the future, they incorporate all of the Doctrine s clauses Eg. Del DoUo Enterprises. FTC Ok!. :"o. 9257 (April 21 , 1994) (consent order). - E.g.. FTC National Credir SCHns. Inc. No. 91- 1218-S (M. D. Ala. Dee. 21 . j 992) (final judgment and consent order) JAMES R. WY A IT 117 117 Complaint