WASHINGTON -- The Federal Trade Commission is cracking down on what officials say is deceptive advertising by energy-efficient window manufacturers, including two companies that President Barack Obama lauded as part of his administration's "green stimulus" initiative.
The FTC filed complaints earlier this year against five companies in California, Kentucky, Pennsylvania and Maryland for making "exaggerated and unsupported claims about their windows' energy efficiency." All five denied wrongdoing but agreed to settle with the FTC, which followed up in August by issuing warning letters to 15 more companies nationwide.
The letters don't accuse the companies of breaking laws, but they cite "unsubstantiated claims" similar to those challenged in the previous five FTC complaints.
"These weren't bad companies," said Josh Millard, an FTC staff attorney. "These weren't fraud cases. People got windows. But I think it can be fair to say that they made poor decisions in promoting windows with claims that weren't substantiated."
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The FTC actions shine a spotlight on an industry that benefited from millions of dollars in "green" tax credits offered as part of the 2009 economic stimulus, and they reveal some of the pitfalls of zealous marketing, in business and in politics.
The complaints and letters from the FTC are part of a larger effort by the agency to deter marketers who sell "environmentally friendly" products without the scientific evidence to back up their claims. The FTC on Monday issued the latest version of its Green Guides, publications designed to help businesses ensure that their ads stay on the right side of the law.
"Because you have a lot of firms that are competing in this marketplace, unfortunately we have seen in the past something of a race to the bottom," Millard said. "If one marketer makes a particularly bold claim that consumers can save with their windows, other marketers feel the need to match those claims, regardless of whether they can back those claims or not."