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The FTC fined a Beverly Hills firm $4.6 million.

Federal Energy Systems and an officer of the firm, George L. Yost, were ordered to pay up to $3 million in restitution and $1.6 million in civil penalties for violating franchise disclosure requirements and making false and deceptive claims about its franchises. The firm sells franchises for the sale and installation of equipment that controls heating and air conditioning in commercial buildings. Among other things, the FTC charged that the company misled buyers when it claimed that its equipment was easy to sell, that most of its franchises were highly successful, that franchises would have exclusive territories and that it would perform extensive advertising for them.


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