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Sweepstakes giant agrees to $34 million settlement
DENVER, Colorado (CNN) -- The nation's largest sweepstakes publisher has agreed to a $34 million settlement, the Colorado state attorney general said, and promised to change its practices after a lawsuit brought by 26 states, including Colorado. Publishers Clearing House agreed to a ban on "deceptive solicitations and promotions" in its sweepstakes practices, said Colorado Attorney General Ken Salazar. "This is a landmark settlement for consumers," Salazar said. He predicted the case would have an impact on other sweepstakes operators around the country. The company last summer settled another lawsuit with 24 states and the District of Columbia.
"The settlement will allow PCH to move forward doing what we do best -- serving millions of satisfied customers and awarding millions of dollars to people all over the U.S.," said Robin Smith, chairman and CEO of Publishers Clearing House. The sweepstakes giant is banned from using false statements, such as "you're a winner" or "you're guaranteed to win." Publishers Clearing House is also required to provide a sweepstakes fact sheet, which will explain to consumers that they do not need to purchase anything in order to win. The fact sheet will also give the odds of winning, which were previously included in very small print. Publishers Clearing House is also banned from targeting any consumer groups, such as senior citizens. It could take 90 days before the ban on deceptive practices goes into effect, Salazar said. Colorado, which sued the sweepstakes publisher in January 2000, took a lead role in the investigation. The $34 million settlement will be distributed among all 26 states participating in the settlement: Arkansas, Arizona, Colorado, Connecticut, Delaware, Florida, Iowa, Indiana, Kansas, Kentucky, Massachusetts, Maryland, Maine, Michigan, Minnesota, Missouri, North Carolina, New Jersey, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, Wisconsin, and West Virginia. Publishers Clearing House said it will continue with its next $1 million prize, to be awarded on August 23. |
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