It can take a lot of shoe leather to investigate housing options for older relatives. So entrepreneurs have stepped in to help make those transitions easier. But according to the FTC, two unrelated businesses that offered free online placement services for people looking for long-term care facilities didn’t live up to their claims that they researched each location thoroughly. The settlements offer compliance insights for other companies, too.
Ads for CarePatrol — which has franchises in twelve states — claimed that their "Nationally Certified Advisors look beyond the chandeliers and fancy lobbies to monitor each community's care history and state violations so we can recommend: The Safest Options for Your Loved Ones." In addition to "grad[ing] each and every facility from A to F based on their last state survey," CarePatrol claimed that its staff evaluated local facilities individually: "Our local senior case consultants also pre-screen every home we recommend." But according to the FTC’s complaint, the services the company provided didn’t live up to the advertised promises.
ABCSP — which operates through a network of franchises across the country — claimed to match clients with the best long-term care housing options based on its local care coordinators’ viewing of "virtually all” or “most every” facility in their geographic regions. Not so, says the FTC. Among other allegations, the complaint charged that in numerous regions, the recommendations weren’t based on the personal knowledge of ABCSP’s staff or agents regarding even a substantial majority of long term care facilities in their regions.
Both CarePatrol and ABCSP have entered into settlements that will bar future misrepresentations about the nature of their services. But the cases offer two take-away tips for other companies interested in keeping their claims compliant.
First, with the daunting amount of information available out there, some businesses are marketing services aimed at customizing data based on users’ needs — in effect, that they can be consumers’ eyes and ears. That’s great, as long as companies remember that long-standing truth-in-advertising principles apply. If your stock-in-trade is information and you advertise first-hand, individualized services, live up to that promise.
Second, the services at issue in the two FTC lawsuits were free to consumers. But that doesn’t relieve businesses of their obligation to support their claims, especially when what’s at stake is a decision as important as a family member’s care.