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Marketer admits sending millions of deceptive spam text messages

A Wisconsin man has agreed to pay $10,000 to settle Federal Trade Commission allegations that he sent millions of unwanted and misleading text messages to consumers with bogus offers of "free" gift cards and electronics.

The FTC had accused Jason Q. Cruz of West Bend, Wisc., of sending texts that offered $1,000 gift cards to major retailers or free iPads to those who clicked on links in the messages.

A typical message read, “You have been selected for a $1,000 Walmart GiftCard, Enter code ‘FREE’ ... to claim your prize: 161 left!”

People who clicked on the links did not receive the merchandise, the FTC said. Instead, they were directed to websites that requested personal information and required them to sign up for services that cost money and included recurring monthly charges.

“When scammers use unwanted text messages to entice consumers with deceptive offers, that’s a significant problem,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Banning a serial spammer like Mr. Cruz from sending unsolicited text messages helps the FTC take a huge cut out of scammers’ efforts to target consumers in this way.”

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Cruz reached a settlement with the FTC that permanently bans him from sending or assisting others in sending unsolicited text messages to consumers. The order also bans Cruz from deceptively presenting an offer as “free,” and from misleading consumers about the use of their personal information.

The order also includes a judgment of more than $185,000, which represents all the money Cruz received in connection with the scam. But Cruz will be required to pay $10,000, "based on Cruz’s inability to pay the full amount," the FTC said.

In addition, Cruz is required to destroy all consumer information he may have acquired over the course of the scam and cooperate with any further FTC investigations.

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