Churchcastle, trading as Fast Cash, and UK Prize Bonanza, sent unsolicited mailings to nearly 1.4m consumers telling them they were entitled to claim one of the awards listed and urging them to act quickly by calling a premium rate number at 拢1.50 per minute.
Calls lasted up to five minutes, each call costing around 拢7.50 with over 190,000 people calling the number used in the promotions.
The OFT found that the mailings were misleading in their layout and led the recipient to believe they had won a major cash prize of 拢5,000 or 拢10,000, when in fact nearly everyone had received only 'giveaway' items such as discount vouchers.
The OFT worked with Trading Standards, the Advertising Standards Authority and the ICSTIS to collect evidence for the case.
The OFT has obtained undertakings from the company, its director Neil Frogley and employees Karen Dacies and Carly Assell that they will not publish or distribute materials giving misleading impressions that a recipient of an ad has previously entered a promotion.
They also promised not to mislead recipients that they have won a major prize or state that each prize appearing in a list of prizes is a major prize or of equal or similar value.
The promoters have undertaken that in the future they will not act in connection with the promotion of unlawful lottery in contravention of the Lotteries and Amusements Act 1976.
If the group breaches any of the undertakings, the OFT could seek a court order. Failure to do so could result in proceedings for contempt of court.
Penny Boys, OFT executive director, said: "Misleading mailings such as these deceive consumers and damage the reputation of fair-dealings businesses using legitimate direct marketing techniques. We will continue to work with fellow enforcers to stamp out these practices."
Pic: Getty Images
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