FTC warns online retailers to ship on time

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By Linda Rosencrance

(IDG) -- The Federal Trade Commission (FTC) is warning online retailers to live up to their holiday promises to consumers.

Monday, the agency said it had sent letters to 72 e-retailers reminding them to comply with federal regulations.

The FTC said it recently surfed the Web sites of 110 Internet retailers offering top-selling holiday items to determine whether they were making "quick-ship" claims and certain other federally mandated disclosures, including warranty information.

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The 72 sites singled out by the FTC were in danger of violating federal laws. The FTC didn't name the companies it targeted.

In a statement, the FTC said 52 of the e-retailers made quick-ship claims, telling consumers that in-stock items usually ship within 24 to 48 hours after an order is placed.

Under the agency's Mail Order Rule, which governs purchases made online, merchants must ship products to customers within the time stated or within 30 days if no time is given. If the company is unable to ship within the stated time, it must notify the consumer of the delay and provide a revised shipping date. Sites that promise to ship within 48 hours but that are unable to do so must notify the consumer and offer the option of canceling the order.

As a result of consumer complaints made during the 1999 holiday season, the FTC sued seven well-known retail companies for allegedly violating the Mail Order Rule. The companies paid more than $1.5 million in total civil penalties, the commission said.

Last year, the FTC surfed more than 200 Web sites and found that more than 100 of them made quick-ship claims to consumers. FTC spokesman Mitchell Katz said there has been increased compliance since 1999.

A survey released Monday by The Goldman Sachs Group Inc., Harris Interactive Inc. and NetRatings Inc. said that 35 percent of all Americans are very satisfied with their online holiday shopping experiences.

This year, the FTC also found that 52 of the sites that were selling products under warranty didn't provide adequate information about the warranties.