November 9, 2017 | dan FTC Charges Office Supply Scheme with Bilking Millions of Dollars from Small Businesses for ‘Free’ Samples of Cleaning Products At the Federal Trade Commission’s request, a federal court temporarily halted a New York-based office supply scheme that charged small businesses and non-profit organizations millions of dollars for “free” samples of cleaning and other products. The agency seeks to end the defendants’ illegal practices and recover restitution for victims. According to the FTC, the defendants called small businesses throughout the United States and Canada, offered a free sample, and then billed them for it, even when they refused the sample. The defendants’ invoices typically named an employee in the targeted business or organization, which led many recipients to pay, believing that the employee had ordered the product. After the initial shipment, the defendants often sent increasingly larger quantities of the product, with invoices for increasingly higher amounts. Consumers who complained were told the extra shipments were part of the initial order. Some people paid just to stop the defendants’ repeated contacts, but more shipments then followed. The defendants often denied refund requests, claiming that as chemicals, their cleaning product cannot be returned. The defendants are A1 Janitorial Supply Corp., also doing business as A One Janitorial; Century Manufacturing Corp., also d/b/a A-1 Janitorial Supply; Commercial Maintenance Chemical Corp., also d/b/a CMC; Global Direct Resources Inc., also d/b/a A-1 Janitorial; Century Manufacturing, Commercial Maintenance Chemical, and Target Supplies; Eric Sternberg; and Matthew Sternberg. They are charged with violating the FTC Act, the FTC’s Telemarketing Sales Rule, and the Unordered Merchandise Statute. The Commission vote approving the complaint was 2-0. The U.S. District Court for the Northern District of Illinois, Eastern Division, entered a temporary restraining order against the defendants on November 1, 2017. The FTC would like to thank the Office of the Illinois Attorney General, the Office of the Kansas Attorney General, and the Better Business Bureaus of Chicago and Northern Illinois, Manitoba and North West Ontario, New Jersey, and Metropolitan New York for their invaluable assistance. NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.