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This Just In

New FTC Rule Will Help Combat Trade Show Scammers

FRANCES FERRANTE, SENIOR EDITOR
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WASHINGTON, D.C. — Industry leaders are confident that the Federal Trade Commission’s (FTC) new rule on government and business impersonation will help combat widespread hotel reservation scams and email list sale scams.

Under the new rule, the FTC can now file federal court cases on behalf of those injured by scammers, and impose civil penalties on those caught using business logos to communicate with consumers online or by mail, or spoof business emails and web addresses, or for falsely implying business affiliation.

These frauds have been a persistent issue for organizers like Mark Bogdansky, Vice President, Trade Shows and Community Engagement, Auto Care Association. “Until the hotel reservation scam was stopped, I would get three to four emails a week either from one of these scammers or from an attendee or exhibitor asking me if they are ok to use. Add in those folks who showed up at my events only to be told they didn’t have a hotel room…The same thing is true for the list folks. I must get two emails a day from those companies,” he said.

Most damaging is that attendees think his organization must be providing their information to the scammers. “Our attendees, no matter how many times we explain that these are scams and we haven’t shared anything, believe we have. So we are losing their trust. And in an age where data is so important, having your attendees trust you that you will protect their information and data is absolutely crucial.”

The association responds by sending cease and desist letters, he said, “and then a new company pops up the next day doing the same thing.”

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The fraudulent use of fake websites, phone calls and email outreach is widespread and pervasive, said Marsha Flanagan, M.Ed., CEM President & Chief Executive Officer, International Association of Exhibitions and Events, and Ex-Officio of the Exhibitions and Conferences Alliance (ECA). “This issue has affected our industry for decades. Even for IAEE’s annual show, our team receives no less than 75 attempts each year. Multiply that by over 10,000 shows that take place every year in the U.S.”

ECA has been leading the charge in advocating for this new FTC rule, with the ultimate goal of enforcing more strict actions to shut down scammers for good. “Moving forward, we urge the FTC to maintain its legal actions against these scammers,” Hervé Sedky, Chair of the ECA Board of Directors and President and Chief Executive Officer of Emerald Holding, Inc., said. “Doing so will not only serve as a strong deterrent against future fraudulent attempts but also ensure that the new rule is effectively enforced. These deceptive practices not only undermine the integrity of our events but also pose significant risks to our customers, especially small businesses that may struggle to recover from such fraud.”

“Hopefully, this new ruling will stop these companies from creating the web sites and call centers that commit copyright and trademark infringement that steal millions of dollars from consumers and subsequently sow distrust with brands, through no fault of the show organizer or their event stakeholders,” Flangan said. “These scammers would have harsher and more enforceable penalties at the federal level. The overall impact is to re-establish trust between shows and their customers, and drive commerce, and to ensure that data is protected and used to promote customer centricity and business viability.”

Victims of fraud can now directly report scams online at https://reportfraud.ftc.gov/#/

Reach Mark Bogdansky at mark.bogdansky@autocare.org; Marsha Flanagan at mflanagan@iaee.com; Hervé Sedky at Herve.Sedky@emeraldx.com

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