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     The Federal Trade Commission has charged American Family
Publishers, Inc. ("AFP"), a New York magazine subscription
marketer, with violating the Federal Trade Commission Act by using
deceptive and abusive debt collection practices.  AFP used
independent debt collection agencies to send deceptive attorney
collection letters to consumers.  Through these letters, AFP's
collectors misrepresented that AFP intended to take legal action
against the consumer.  
     According to Barry J. Cutler, Director of the FTC's Bureau of
Consumer Protection, "this is the first time the Commission has
charged a creditor for the illegal collection activities of the
debt collectors it approved.  Because of their economic influence,
the power of large creditors such as AFP over their outside debt
collectors is pervasive and, when misused, can operate to undermine
compliance with the Fair Debt Collection Practices Act."  Cutler
further said the issuance of this complaint is a signal that the
Commission staff will not hesitate to pursue a creditor who
"knowingly approves" such violations.  "This case is consistent
with an enforcement approach of placing liability on parties who
actively assist violations, and who seem willing to make a profit
by appearing to look the other way when their associates break the
law," said Cutler.
     The FTC's administrative complaint charges that AFP's
collectors mailed computer-generated form debt collection letters
to numerous consumers.  These letters were printed on an attorney's
letterhead, and some contained a facsimile of an attorney's
signature at the bottom.  The content and format of the letters
allegedly misrepresented that the consumer was about to be sued and
that an attorney was actively and substantially involved in the
collection of the debt.
     The complaint charges that AFP violated the law when it
approved the mailing of these letters with knowledge of the
misrepresentations they contained.  In fact, no attorneys were
actively or substantially involved in the collection of the debts
at issue, and no legal action was about to be initiated if the
debts were not paid.
     The Commission issues an administrative complaint when it has
"reason to believe" that the law has been or is being violated, and
it appears to the Commission that a proceeding is in the public
interest.  The issuance of a complaint is not a finding or ruling
that the respondents have actually violated the law.  Such action
marks the beginning of a proceeding in which the allegations will
be ruled upon after a formal hearing.
     Copies of the complaint are available from the FTC's Public
Reference Branch, Room 130, 6th St. & Pennsylvania Ave., N.W.,
Washington, D.C.  20580; 202-326-2222; TTY 202-326-2502.
                              # # #
MEDIA CONTACT:      Brenda A. Mack, Office of Public Affairs
STAFF CONTACT:      Jean Noonan, Bureau of Consumer Protection,
                    Roger J. Fitzpatrick, Bureau of Consumer
                    Protection, 202-326-3172

(File No. 872-3239)