FTC, Miss Cleo reach agreement
Saturday, February 23, 2002
WASHINGTON -- The government and Miss Cleo's psychic hot line have reached a temporary meeting of the minds allowing the telephone service to keep predicting while an investigator looks into charges that it has defrauded customers.
U.S. District Judge Alan Gold of the Southern District of Florida has approved a settlement with the Federal Trade Commission under which a court-appointed auditor will monitor all past, present and future activities of Access Resource Services Inc. and Psychic Readers Network.
The two Fort Lauderdale, Fla., companies have a national network of "psychic readers," led by Jamaican soothsayer "Miss Cleo," that promises insights in matters of love and money.
Under the preliminary injunction, the companies are required to disclose in their advertisements the cost of their pay-per-call service; stop representing that callers receive a "free reading;" and stop using toll-free numbers in ads without disclosing that the service is accessed through 900 numbers.
The FTC said the injunction will be in place until the court issues a final ruling on its allegations.
New York attorney Sean Moynihan, who represents the two companies, said the two companies felt vindicated by the agreement because in the original lawsuit filed on Feb. 14 the FTC had sought to freeze their assets and shut down their operations.
He said they look forward to working with the FTC and demonstrating how their business works but regret this wasn't done before the lawsuit was filed.
The companies have also been sued by at least eight other states, and Florida authorities have a separate lawsuit challenging "Miss Cleo," Youree Dell Harris, to prove that she really is a renowned shaman from Jamaica.