CAREPATROL Made False, Deceptive, Misleading Claims, according to the Federal Trade Commission (FTC). Has CarePatrol ceased making misleading representations… or not?
(UnhappyFranchisee.Com) December 3, 2012 the Federal Trade Commission (FTC) issued a Complaint and a Decision and Order regarding the elder care services referral franchise company CarePatrol, Inc. (Docket No. C-4379).
The FTC Complaint alleged that CarePatrol made representations that were “false or misleading” regarding its supposed analysis, monitoring and grading of senior care facilities, that it misrepresented the size and coverage of its consulting network, and that those misrepresentations constituted “deceptive acts or practices… in violation of Section 5(a) of the Federal Trade Commission Act.”
The FTC complaint cited these CarePatrol representations (among others) as false and misleading:
…CarePatrol’s local, Nationally Certified Advisors… monitor each community’s care history and state violations so we can recommend: The Safest Options For Your Loved One
At CarePatrol.. We Grade Each and Every Facility From “A” to “F” Based On Their Last State Survey. Our Local Senior Care Consultants also Pre-Screen every home we recommend…
The FTC complaint stated:
…CarePatrol has made representations, expressly or by implication that:
a. It monitors or grades the care history and violations of virtually all, or a substantial majority, of all assisted living facilities in a consumer’s desired location (Exhs. A
b. It provides services through a network of senior care consultants who are located in every state (Exh. C); and
c. It monitors or grades assisted living facilities based on a review of the facilities’ latest state inspection reports (Exh. B).
7. In truth and in fact:
a. CarePatrol does not monitor or grade the care history and violations of virtually all, or a substantial majority, of assisted living facilities in a consumer’s desired location. In most states listed on CarePatrol’s website, it has not monitored or graded any facilities;
b. CarePatrol does not provide its services through a network of senior care consultants who are located in every state; and
c. In numerous instances, CarePatrol does not monitor or grade assisted living facilities based on a review of the facilities’ most recent state inspection reports.
Therefore, the representations set forth in Paragraph 6 are false or misleading.
The FTC issued a Decision and Order that prohibits CarePatrol from making prohibited representations:
I. Prohibited Misrepresentations; Substantiation
A. IT IS ORDERED that respondent, directly or through any corporation, subsidiary, division, franchisee, or other device, in connection with the advertising, promotion, offering for sale, or sale of any covered service in or affecting commerce, shall not represent in any manner, directly or indirectly, expressly or by implication, that:
1. It or its franchisees monitor or evaluate the care history or state violations of any number, portion, or percentage of assisted living facilities in a consumer’s desired location;
2. It or its franchisees provide their services through officers, agents, employees, and/or contractors who are located in any geographic area of the United States; or
3. It or its franchisees evaluate assisted living facilities based on a review of information, including state surveys, or any other records detailing the performances of these facilities, unless the representation is non-misleading and, at the time it is made, respondent possesses and relies upon competent and reliable evidence that, when considered in light of the entire body of relevant evidence, substantiates that the representation is true.
The FTC Decision and Order also requires CarePatrol to maintain and provide to the FTC any promotional materials containing the representations along with substantiation of its claims:
IT IS FURTHER ORDERED that respondent CarePatrol, Inc., and its successors and assigns, shall, for five (5) years after the last date of dissemination of any representation covered by this order, maintain and upon request make available to the Federal Trade Commission for inspection and copying:
A. All advertisements and promotional materials containing the representation;
B. All materials that were relied upon in disseminating the representation; and
C. All reports, studies, surveys, demonstrations, or other evidence in its possession
or control that contradict, qualify, or call into question the representation, or the basis relied upon for the representation, including complaints and other communications with consumers or with governmental or consumer protection organizations.
Is CarePatrol Complying With the FTC Order?
A number of these videos (in our opinion) seem to contain the representations prohibited by the FTC Order.
For example, the narrator of “CarePatrol “National TV Commercial” posted since 2013 states: "CarePatrol researches the care and violation history of every community in their network BEFORE they recommend them to you”
“CarePatrol Assisted Living Search” published since February 2011 by Chuck Bongiovanni states “CarePatrol pre-screens and monitors assisted living violation records, their care history, and continues to monitor them to refer only the best.”
UnhappyFranchisee.Com has posted a number of CarePatrol videos and commercials that make research, grading and monitoring claims here: CAREPATROL Videos & Commercials: STILL Misleading?
In addition to videos, there are literally dozens of promotional web pages that contain virtually the same claims that prompted the FTC Complaint.
We aren’t sure whether these representations are in violation of the 2012 FTC Order or not… We are seeking clarification from the company and the FTC.
Is CarePatrol Misrepresenting the FTC Order in its Franchise Disclosure Document (FDD)?
Another issue is whether CarePatrol is accurately and properly disclosing the FTC Complaint and Order to prospective franchisees as required by the FTC Franchise Rule.
Franchisors, like CarePatrol, Inc., are required to disclose certain information to prospective franchisees in a document called a Franchise Disclosure Document, or FDD.
According to the FTC Franchise Rule Compliance Guide:
The franchisor must disclose whether it… is subject to a currently effective injunctive or restrictive order or decree resulting from a pending or concluded action brought by a governmental agency – such as the FTC, SEC, or state Attorney General – under a federal, state, or Canadian franchise, securities, antitrust, trade regulation, or trade practice law, or that otherwise relates to the franchise…
UnhappyFranchisee.Com has raised the concern that CarePatrol may have misrepresented and minimized the severity of the FTC Complaint, as its disclosure wording seems to imply that the FTC was simply requesting some web site wording changes (which CarePatrol complied with), that “there was no intent to deceive” on the part of CarePatrol. and that there “was no fine or penalty imposed.”
CarePatrol, Inc. neglects to disclose the existence of the FTC Decision and Order FTC which imposes prohibitions, restrictions, record-keeping and disclosure obligations on CarePatrol, its employees, officers, agents and franchisees for a term of not less than 20 years.
For more on our concerns about CarePatrol’s Franchise Disclosure Document (FDD) read: Is the CAREPATROL Franchise Disclosure Document (FDD) Misleading?
UnhappyFranchisee.Com Invites Open Dialogue on CAREPATROL and the CAREPATROL franchise
We believe that CarePatrol, Inc., CEO Chuck Bongiovanni and CarePatrol franchise owners deserve every opportunity to provide clarifications, opinions, rebuttals or other statements regarding the concerns raised by UnhappyFranchisee.Com. We are reaching out to Mr. Bongiovanni and will be happy to faithfully publish his responses and his clarifications. All are welcome to provide comments on any CarePatrol post or provide comments in confidence via emails.
We are also inviting input from the Federal Trade Commission (FTC) on both the consumer protection and franchise disclosure issues, and will also be seeking input from state franchise regulatory agencies in the future.
Please feel free to share your thoughts on these important issues regarding CarePatrol and senior care consulting agencies.
CAREPATROL Investigation & Discussion Links
CAREPATROL Investigation: Documents & Links (Includes actual CarePatrol FDDs and FTC Documents)
CAREPATROL Franchise Complaint – Updated October 11, 2010
CAREPATROL: Franchisees Praise the CarePatrol Franchise October 14, 2010
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