FTC Looking Into EToys’ Consumer Practices

Government regulators are looking into whether online retailer EToys and other electronic commerce firms are shipping goods to customers in a timely manner and whether they are responsibly marketing video games and software to children.

Bob Smith, executive director of the online retailing trade group Shop.org, said he didn’t know of any other companies that had been contacted by the Federal Trade Commission.

But EToys spokesman Ken Ross said, “These do appear to be industrywide reviews of certain business practices.”

FTC spokeswoman Claudia Bourne Farrell said she could not discuss whether the agency is investigating any e-commerce companies. But industry analysts said the federal agency is most likely taking a broad look at these issues.

“E-commerce is achieving critical mass, and so consumer needs are [important] for the government,” said David Cooperstein, director of online retail research for Forrester Research in Cambridge, Mass.

In a securities filing this week, Santa Monica-based EToys said the Federal Trade Commission is conducting an “inquiry to determine compliance with the FTC’s Mail or Telephone Order Merchandise Rule, which regulates the timeliness of the shipment of orders placed by customers.”

EToys also said in the filing that the FTC requested information about “the marketing of video games and software to children, particularly those that have a rating of ‘mature’ or higher under the Entertainment Software Rating Board interactive rating system.”

EToys shares closed at $15.19, down 56 cents in Nasdaq trading Thursday.