US— ValueClick, an online marketing specialist, will pay a record $2.9m to settle Federal Trade Commission (FTC) charges that it deceived consumers with offers of prizes to complete surveys.

The FTC charged ValueClick subsidiary Hi-Speed Media with using deceptive emails, banner ads and pop-ups to drive consumers to its websites.

The emails and online ads claimed that consumers were eligible for free gifts, such as laptops and iPods, and included come-ons such as ‘Free PS3 for survey’.

Consumers lured to websites by these promises were led through “a maze of expensive and burdensome third-party offers which they were required to ‘participate in’ at their own expense in order to receive the promised ‘free’ merchandise”, alleged the FTC.

Under the terms of the settlement, the largest since the CAN-SPAM Act was enacted in 2003, ValueClick must provide users with a list of obligations that consumers would need to fulfil to claim a free gift.

ValueClick, along with subsidiaries Hi-Speed Media and E-Babylon, was also accused by the FTC of failing to protect consumers’ financial details in line with industry standards.

In a statement, ValueClick said it “agreed to a settlement payment without an admission of liability or conceding that the company violated any laws”.

David Yovanno, ValueClick’s chief operating officer for US media, said: “We believe this settlement will help set the guidelines for the lead industry as a whole and we will continue to participate in the Interactive Advertising Bureau to help best practices to that end.”

The settlement is subject to approval by the Department of Justice and the presiding court.

Author: James Verrinder