Lester Rothschild

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF LESTER ROTHSCHILD TRADING AS GEN- PAK CO~1- P ANY, AMERICAN DEPOSIT SYSTE:Nl, AND :NIANPO'VER CLASSIFICATION BUREAU COMPLAINT, DECISION, FINDINGS, AND ORDERS IN REGARD TO THE AL- LEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. , 1914 Docket 5853. Complaint, May 19511 Decision, Mar. , 1952 Where an individual engaged in the interstate sale of post cards and letters, coupled with a service to creditor purchasers for obtaining information concerning their delinquent debtors, under a plan whereby said customers addressed the cards, identified by a serial number, to their debtors or others from whom information was sought, and sent them to said individual who mailed them and thereafter returned from his Chicago place of business to the proper customers such replies as he received, and sent to the debtor or person supplying the information three pen points, worth about three cents and covered in the cards' purchase price, together with circulars advertising other products he sold;

In making use, in said connection of (1) a form of double post card which, beaded by said individual's Chicago office and trade name, advised the consignee that "we are holding a package which we will send .to you, upon receipt of the attached post card with complete identification filled in " and on the reply portion, addressed to said individual's trade name Chicago address, provided, under the instruction to "send the above package to, for the consignee s name and address, and under the caption party must be identified", for the name and address of the consignee s employer, "bank and friends, along with the caution that "all questions must be answered or package will not be sent" ; and (2) another form of double post card designed to be sent to persons other than the debtor, and to elicit, on the same pretext, the desired information as to the debtor- (a) Falsely represented and placed in the hands of his customers a means of falsely representing to the customers' debtors and others from whom information concerning such debtors was sought, that the latter were consignees of packages of substantial yalue sent by firms other than said individual and in his hands, and that delivery could not be made because of lack of identification or address;

The facts being that said individual business had nothing to do with transportation or delivery of packages; the packages to which the cards referred \were those he made up, containing the pen points and advertising matter; and bis whole scheme was one of obtaining information by subterfuge; and Where said individual making use of other form letters under the trade name, Manpower Classification Bureau, followed by his Chicago address, and the caption "CLASSIFICATION NO. D" and the words "AREA 6 ZONE 211-51", requesting similar information from the addressee debtor or other person- (b) Falsely represented through the statements therein and the name "Man. power Classification Bureau, and placed in the bands of his customers 1 Amended and supplemental.

Syllabus 48 F. T. C.

a means of falsely representing to tbe customers' debtors and others, that he was engaged in operating a labor classification bureau or other bureau for tbe purpose of obtaining information as to the employment situation, or the availability of manpower in certain areas, and that the information desired was in connection therewith;

When his only purpose was to place in the bands of bis customers tbe means of obtaining information relating to debtors by subterfuge; and Where said individual, in making use of other form letters under the trade name The American Deposit System, with his Chicago address, and sucb matter as u (Type ' )" preceded by the words re: DISBURSEMENT NO. C", advising the addressee that "if you are the party as addressed above, and you will fill in the answers to the information requested below, we will forward to you a small sum of money deposited with us, for you, and calling for a variety of information concerning the addressee- (c) Falsely represented and placed in the hands of his customers a means falsely representing that he had been named as depository of a reasonably substantial sum of money, to be delivered to the recipient of said form letter upon proper identification by furnishing all the information requested; The facts being tbe only money sent to recipients of the form letters was three cents, which was included in the price charged his customers for the form letters;

With tendency and capacity to mislead and deceive many persons to whom tbe cards and form letters were sent, into the erroneous belief that the repres~ntations were true, and by reason thereof into furnishing him and big customers information which they would not otherwise supply: Held, That such acts and practices, under the circumstances set forth, were all to the pr~judice and injury of the public and constituted unfair and deceptive acts and practices in commerce.

As respects respondent's appeal from the initial decision of the hearing examiner (which became the decision of the Commission following the Commission denial), on the ground that tbe activities concerned did not as a matter of law constitute any deception or tendency to deceive and that the representations were true: such statements and representations, including those implicit in the use of the aforesaid trade names, when in fact his business, so far as the recipients of the form letters were concerned, had nothing to do with manpower classification or employment service, and no money bad been deposited with him for such addressees, clearly had the capacity and tendency to mislead the recipients of the cards and letters, and it was immaterial that the record did not contain evidence of actual deception. As respects respondent's contentions, in connection with his aforesaid appeal, that the Commission was without jurisdiction because be was not engaged in interstate commerce and because the relief sought was an attempt to regulate the use of the mails, and such power, if any, vested solel~' in tbe Post Master General: the acts and practices concerned, involving the sending and return of letters, clearly constituted commerce and fell within the jurisdiction of the Commission under its duty and authority to prevent unfair and deceptive acts and practices therein. The fact that respondent might have used the mails in connection with such acts and practices did not serve to divest the Commission of its authority and responsibility in said respect. GEN-O-PAK co., ETC. 1049 1047 Complaint As respects respondent's contention, in connection with bis said appeal, that tbe examiner s findings and conclusion and his order against the continuation of the acts and practices involved were not sustained by the evidence in the record: the Commission was of the opinion that sucb findings were supported by substantial probative evidence, that the conclusion contained therein was correct, and that the order was adequate and appropriate to provide proper relief from the respondent' s unlawful acts and practices. Before Mr. Webste1' Ballinger hearing examiner. Mr. J. W. Brookfield, Jr. for the Commission. W ilhartz Hirsch of Chicago, Ill., for respondent. AMENDED AND SUPPLEMENTAL .COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that Lester Rothschild an individual trading as Gen- Pak Company, hereinafter referred to as respondent, has violated the provisions of said Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its amended and supplemental complaint, stating its charges in that respect as follows: PARAGRAPH 1. Respondent Lester Rothschild is an individual trading and doing business under the name of Gen- Pak Company, with his office and principal place of business located at 139 North Clark Street, Chicago, Illinois (Room 900).

PAR. 2. Respondent is now, and for more than two years last past has been, engaged in the sale and distribution of double post cards form letters, and other literature designed and intended to be used by creditors and collection agencies in obtaining information concerning debtors. Respondent causes said post cards, form letters, and other Jiterature to be transported from his aforesaid place of business in the State of Illinois to purchasers thereof located in various other States of the United States. Respondent maintains, and at all times mentioned herein has maintained, a course of trade in said post cards form letters and other literature in commerce between and among various States of the United States. Respondent's volume of trade in said commerce is substantial.

PAR. 3. Respondent sells two forms of post cards, one designed to be sent to the debtor and one to be sent to others. On the form to be sent to the debtor the following language appears: Dear Friend:

We are holding a package which we will send to you, upon receipt of the attached post card, with complete identification filled in. We will bold same at YOUR risk, subject to YOUR forwarding dir-sections for 30 da~Ts and full and Complaint 48 F. T.

complete identification. There are NO cbarges whatsoever, and package will be sent to you all charges PREPAID.

On reply portion of this card, which is addressed to Gen- Pak Company, there is printed a form containing questions with respect to the debtor as follows:

MAIL THIS CARD TO US AT ONCE THE GEN- PAK COMPANY CITY HALL SQUARE BLDG.

CHICAGO 2, ILLINOIS Package Identification Cheeked Number Dept.. Unidentified Charges No Charges- - Please send package (fully prepaid) to me. My correct address and identification is as follows.

SEND THE ABOVE PACKAGE TO Prin t Correct ~ ~ N an1e - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Print 6 ~ Correct Address - - - - - Print City -- - - State - - - --- - - - PARTY MUST BE IDENTIFIED For identification I refer you to my employer, my bank and friend. Bank - - address- - -- - - - - - - - - - - - - - - - City - - Employer - - - Address - - - - City - - Dept. ---- - Check No. - - -- - - Friend - - - Address - -- - - - City - - ALL questions must be ANS.WERED, or package will NOT be Rent GENERAL DESCRIPTION OF MYSELF Color Hair - - Color Eyes - - - - Height - ----------- Weight -------------- Age ------- If Married 1\1 ate s First Name - - NO POSTAGE OR ADDRESSING NECESSARY Z ~ Copyrighted 1948 by Gen- Pak Co.

On the card designed to be sent to others than the debtor the following language appears:

........

GEN- PAK CO., ETC. 1051 1047 Complaint Dear Friend:

'Ve have on band a package which we wish to deliver to' the party whose name and last kno\vn address appears in the left hand margin of the attached postcard, but we are unable to make delivery, since we do not know where he now resides.

Will you be kind enough to give us the CORRECT address of the attached PREPAID reply card, to enable us to effect delivery? If, however, you do not know the correct address of this party, can you sugges SOMEONE who may be able to assist us? Thanking you in advance for any help you can give, and appreciating a prompt reply, we remain Cordially yours, THE GEN- PAK COMPANY.

The reply portion of this card, which is also addressed to the ----------- - Pak Company, also contains. questions with respect to the Gendebtor and is as follows:

PLEASE REPLY PROMPTLY IDENTIFICATION Checked - - - - NUMBER Dept. --______ ADDRESS Charges - - - - - -- - - - -- PLEASE PRINT ANSWERS CORRECT ADDRESS OF PARTY IS En1ployer - - - - - ~ .s City - -- - - -- -- -- -- - - State ----- --- -- -- -u:.. Address - - - - NAME AND ADDRESS OF RELATIVE OR FRIEND Name (A) -- - - Address - - - - Q) I City - - State - - - -- - - -:::~ Z ~r2::r:: Name (B) - - Address .- - - - City - - State -- - - - IF YOU ARE UN ABLE TO HELP US Whom Do You Suggest? Name - - Address - - - - City - - State - - - PAK COMPANY rr.: THE GEN- Q) C) CHICAGO 2, ILLINOIS Copyrighted 1950 by Gen- Pak Co.

Respondent' s purchasers or customers address the cards to the debtors or others from whom information concerning debtors is sought and cause them to be delivered to respondent in Chicago Complaint 48 F. T. C.

Illinois. Respondent then deposits the individual cards in the United . States mail. Such of the return cards as are filled out and mailed are received by respondent and sent by him to the proper customer whom he is able to identify by a serial number stamped on the cards prior to delivery to the customer. Respondent then sends to the debtor or to the person who supplies the information as aforesaid three pen points enclosed in a small envelope, together with advertising circulars of other products sold by him. The pen points have negligible monetary value.

PAR. 4. By the use of the aforesaid cards respondent has falsely represented, and placed in the hands of his customers a means of falsely representing, directly or by implication, to customers' debtors and others from whom information concerning such debtors is sought that such debtors are consignees of packages sent by firms other than respondent and in the hands of respondent in the usual course of his business; that the shipments or packages held for the persons to WhOlll the cards were addressed have been prepaid by the consignor and that the packages are held by respondent only for forwarding purposes; that the packages are of substantial value and that delivery cannot made because of lack of identification or address. PAR. 5. The said representations are false and misleading. In truth and in fact, respondent's business has, so far as the recipients of said cards are concerned, nothing to do with transportation of packages or their delivery to the proper consignees. The persons concerning which information is sought are not consignees of packages sent by others and in the hands of respondent for delivery. The packages to which the cards refer are those made up by respondent containing the pen points and advertising matter above referred to and respondent's whole scheme is that of obtaining information subterfuge. In truth and in fact, respondent's only purpose in connection with the sale and distribution of the cards is to place in the hands of his customers the means of obtaining information by subterfuge, and the said cards have no substantial connection with the sale and distribution of other products sold by respondent. PAR. 6. Respondent also sells and distributes in commerce, as aforesaid, form letters which are used by his customers to secure information from debtors and others and which are designed to be sent by respondent' s customers to debtors and others from whom information is sought. Among such form letters is one designated "~1anpower Classification Bureau Type D Information Letter. This letter reads as follows:

. . . . . . . . . ..... GEN- PAK co., ETC. 1053 1047 Complaint MANPOWER CLASSIFICATION BUREAU 139 NORTH CLARK BLDG.

CHICAGO 2, ILLINOIS (space for name and address) CLASSIFICATION NO. D AREA 6 ZONE 811- You are requested to promptly fill out and return this Questionnaire. answering each question where applicable, so that this Bureau can properly classify the kind of work you are best qualified to perform. 1. If in Military Service, check here -- and do not answer any other question. 2. If unable to work at all-check bere 3. If male check here ----. If female check bere 4. Are you subject to Military Service Yes ----. No ----. Rejected 5. What kind of work are you best fitted for-check one: Industrial ----. Agricultural Selling ---- Professional ----. Unskilled labor Skilled labor (State kind) 6. By whom are ~TOU now employed? Employer Address ----------------. City ----------------.. State ----------------0 Dept. --------------. Clock No. ----. Type of .work --------------------. If not employed NOW name LAST employer:

Address ----------------. City ----------------. State ------------ Dept. --------------. Clock No. ----. Type of work 7. Are you willing and able to accept employment in some other part of the United States? Yes ----. No 8. Approximate wages you are now or last received $-------- weekly. 9. Are ~TOU Married? Single -----. Separated __---0 Divorced_-_-_. Mate deceased 10. If married, what kind of work does your mate perform? 11. If married, is your mate willing to accompany you to a new geographical location? Yes ----. . No ----.

12. Your approximate age ----. Your mate s name -------------------------. Age____.

13. Is the above address correct? Yes ----. No ----. If not give correct address here ------------------. City ------------------. State ----------. 14. Do you own an automobile- Yes ----. No ----. If yes, what make ----------. Year ------. License Number Sign here -- PLEASE TYPE or PRINT ANSWERS AND RETURN IN THE PREPAID SELF ADDRESSED ENVELOPE ENCLOSED This Bureau is not a part of any U. S. Government Division DO NOT WRITE IN THIS SPACE AREA Class. ---------. Trans. --------- Non-Tr. -------- Voc. ------------- Spec. ----------. Mil. -----------. Non-Mil. Male ------------. Fem. ----------. File -----------. Age Copyrigbted 1950 Man-CIa-Bur . . . . . . ....... Complaint 48 F. T. C.

This letter is accompanied by a business reply envelope addressed to the l\lanpower Commission Bureau, 139 North Clark Bldg. Chicago 2, Illinois.

Respondent also sells in commerce as aforesaid a form letter designated "The American Deposit System Type C Information Letter which is printed in the following form:

(Double eagle coat of arms or crest) THE AMERICAN DEPOSI'.r SYSTEM 139 NORTH CLARK STREET CHICAGO 2, ILLINOIS (Type "

Date ------------------------ (Space for name and address) (Your File Number Here)Re: DISBURSEMENT NO. C Vol ----- Book ----- Page 251 If you are the party as addressed above. and you will fill in the answers to the information requested below. we will forward to you a small sum of money deposited with us, for you, for that purpose. ALL questions must be answered, so we can determine if you are the proper party. VOID 90 DAYS AFTER ABOVE DATE 1. Are you the party as addressed above? YES ----. NO ----. 1a. If your answer to the above is NO. then what relation are you? --------. If your answer was YER. you need not answer this question. 2. Is the above address correct? YES ----. NO ----. If your answer is NO, what is the correct address -------------------- City ------------------------. State 3. Are you SINGLE MARRIED DIVORCED 3a. If married, what is your mate s complete name ----------- 4. Are you employed NOvV. Yes ----. No 5. If your answer to the above is YES. by wbom are you employed? Name ----------------' Address ----------------. City State -------------- ' Dept. ----------------. Check No. 5a. If your answer is NO, then answer by whom you were LAST employed. Name ----------------. Address --------------. City ------------ State ----------------. Dept. -----------------. Check 6. If married, state by whom your mate is employed. City ----------------. State ------------. Dept. Check No. -------- 6a. If single, do not answer this question. 7. At what address did you LAST reside? City --------------------. State . 8. Give name and addresses of two references who can identify you. 1. -------- ---- ------ -- 2. - - - - - - - 9. My automobile license number is ----------------------______n or: I do not own an automobile, GEN-O-PAK co., ETC. 1055 1047 Complaint 10. Where do you bank? -------------------------------------------------or: I have no bank account.

11. I herebJY affirm that I am the above party. SI G N HERE ----- -- ----- PLEASE TYPE OR PRINT INFORMATION AND RETURN IN THE PREPAID SELF ADDRESSED ENVELOPE HEREWITH ENCLOSED Copyright 1950 Amer. Dep. Sys.

This form also is accompanied by self addressed envelopes addressed Chicago 2to American Deposit System, 139 North Clark Street, Illinois, which is the business address of respondent. Respondent' to the debtors orpurchasers or customers address the form letters others from whom information concerning debtors is sought and cause them to be delivered to respondent in Chicago, Illinois. Respondent then deposits the individually addressed form letters in the United States mail..,. Such of the forms as are filled out and mailed by the recipients and are received by respondent are sent by him to the proper customer whom he is able to identify by a serial number stamped on the forms prior to delivery to the customer. PAR. 7. The recipients of the form letter headed American Deposit System who send in the information requested are then sent a sum of money consisting of a few cents.

PAR. 8. By the use of the statements in the :Manpower Classification Bureau fonn letters and the name :Manpower Classification Bureau respondent has falsely represented and placed in the hands of his customers a means of falsely representing, directly or by implication to customers' debtors and others from . whom information concerning such debtors is sought, that respondent is engaged in operating a labor classification bureau or other bureau for the purpose of obtaining information as to the manpower or employment situation or the availbility of manpower in certain areas and that the information desired is in connection with such manpower or employment situation. PAR. 9. The said representations are false and misleading. In truth recipients of saidand in fact respondent's business has, so far as the form letters are concerned, nothing to do ,,~ith manpmver classification or employment surveys and respondent' s only purpose in connection with the sale and distribution and mailing of said form letters is to place in the hands of its customers the means of obtaining information by subterfuge.

PAR. 10. By the use of the statements in the American Deposit System form letters and the name American Deposit System, respondent has falsely represented and placed in the hands of his customers to cus-a means of falsely representing, directly or by implication, 213840-54- Decision 48 F. T. C.

tomeI'S ' debtors and others from whom information concerning such debtors is sought, that respondent has been named as depository of a sum of money to be delivered to the recipients of said form letter upon proper identification by furnishing all of the information requested. PAR. 11. The said representations are false and misleading. In truth and in fact respondent is not engaged in any fiduciary or other capacity to receive money for the persons to whom the form letters are sent, and the only money sent them is a small amount which is included in the price charged respondent's customers for the form letters.

PAR. 12. The use hereinabove set forth of the cards and form letters containing the false and misleading statements .and representations ha,ve the tendency and capacity to mislead and deceive many persons to whom the cards and form letters were sent into the erroneous and mistaken belief that the statements and representations contained thereon and therein were true and by reason thereof to furnish the respondent and his customers information which they would not otherwise supply.

PAR. 13. The aforesaid acts and practices of respondent, as herein alleged, are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDERS AND DECISION OF THE COMMISSION Order denying appeal from initial decision of hearing examiner and decision of the Commission and order to file report of compliance Docket 5853, March 27, 1952, follows:

This matter came on to be heard by the Commission upon the respondent' s appeal from the initial decision of the hearing examiner herein and upon the briefs and oral argument of counsel in support of and in opposition to said appeal.

Respondent contends in said appeal that the hearing examiner findings as to the facts and conclusion that the respondent has engaged in unfair and deceptive acts and practices in connection with the sale and use of certain post cards and form letters to obtain information from or concerning delinquent debtors, and his order against the continuation of such acts and practices, are not substantiated by the evidence in the record; and that the hearing examiner erred in failing to make certain conclusions of law to the effect that the activities of the respondent challenged in the amended and supplemental complaint are not in interstate commerce, that the relief sought is an attempt by the Commission to regulate the use of the mails, that the activities of the respondent do not as a matter of law constitute any deception GEN-O-PAK CO., ETC. 1057 1047 Decision or tendency to deceive, that the statements and representations made by the respondent are true, and that all or the acts and practices of the respondent are lawful, valid, and legitimate. The record herein shows that the respondent sells certain post cards and form letters which are used to obtain information from or concerning delinquent debtors. The post cards and form letters are shipped by the respondent from his place of business in Illinois to customers located in various other States of the United States. Such customers address such cards and letters and return them to the respondent, who then mails them. Respondent trades under the names of "Gen- Pak Company," ~lanpower Classification Bureau " and .American Deposit System. One of the cards sold and distributed by respondent contains the representation that the respondent is holding a package for the person from whom or about whom information is requested. The package referred to on the card is made up by the respondent and contains pen points and advertising matter relating to pen points. One of the form letters sent out by the respondent, under the trade name of "Manpower Classification Bureau " contains the representation that the respondent is operating a labor classification bureau or other bureau for the purpose of obtaining information as to the manpower or employment situation or the availability of manpower in certain areas. Another form sent out by the respondent, under the trade name of American Deposit System, contains the representation that a sum of money has been deposited with the respondent for the person from whom or about whom information is requested. Respondent's business, so far as recipients of the form letters are concerned, has nothing to do with manpower classification or employment surveys and no money has been deposited with the respondent for persons to whom the letters are sent. The only money sent by the respondent to such persons is 3~. The statements and representations contained in the post cards and form letters so sold and distributed by the respondent, as well as his use of the trade names "~fanpower Classification Bureau" and "American Deposit System " clearly have the capacity and tendency to mislead and deceive the recipients of such cards and letters. is immaterial that the record does not contain evidence of actual deception.

Respondent' s contentions that the Commission is without jurisdiction in this matter because the respondent is not engaged in interstate commerce and also because the relief sought is an attempt to regulate the use of the United States mails, which power, if it exists, is vested solely in the Postmaster General of the United States, are without merit. As stated hereinabove, respondent sells and ships the cards Decision 48 F. T. C.

and form letters to customers located in States other than the State of Illinois. After such cards and letters are addressed by such customers, they are returned to the respondent for mailing to the addressees and information received by respondent is forwarded to his customers. These acts and practices clearly constitute commerce as commerce" is defined in the Federal Trade Commission Act. The Federal Trade Commission is vested with the duty and authority to prevent unfair and deceptive acts and practices in commerce. The fact that the respondent may have used the United States mails in connection with his engaging in the aforesaid unfair and deceptive acts and practices in commerce does not serve to divest the Commission of its authority and responsibility in this respect. The Commission is of the opinion that the findings as to the facts in the hearing examiner s initial decision are supported by substantial probative evidence in the record; that the conclusion contained therein is correct; and that the order is adequate and appropriate to provide proper relief from the respondent's unlawful acts and practices. The Commission, therefore, being of the opinion that the respondent' s appeal is without merit and that the initial decision of the hearing examiner is appropriate in all respects to dispose of this proceeding:

I t is ordered That the respondenes appeal from the. initial decision of the hearing examiner be, and it hereby is, denied. I t is fu-rthe1' ordered That the initial decision of the hearing examiner, a copy of which is attached, shall, on the 27th day of 1\larch 1952, become the deeision of the Commission. I t is further ordered That the respondent shall, within sixty (60) days after service upon him of this order, file with the Commission a report, in writing, setting forth in detail the manner and form in which he has complied with the order to cease and desist. Said initial deeision, thus adopted by the Commission as its decision, follows:

INITIAL DECISION BY WEBSTER BALLINGER, TRIAL EXAMINER Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission on May 23 , 1951, issued and subsequently served its amended complaint-in this proceeding upon respondent Lester Rothsehild, individually and trading as Gen- Pak Company, charging him with the use of unfair and deceptive acts or practices in commerce in violation of the provisions of said Act. After the issuance of said amended complaint and the filing of respondent' s answer thereto, hearings were held at which testimony and other evidence in support of and in opposition to the allegations GEN-O-PAK co. , ETC. 1059 1047 Findings of said amended coillplaint were introduced before the above-named Trial Examiner theretofore duly designated by the Commission, and said testimony and other evidence were. duly recorded and filed in the office of the Commission. Thereafter, the proceeding regularly came on for final consideration by said Trial Examiner on the amended complaint, the answer thereto, testimony and other evidence, proposed findings as to the facts and conclusions presented by respective counsel oral argument not having been requested; and said Trial Examiner having duly considered the record herein, finds that this proceeding is in the interest of the public and makes the fonowing findings as to the facts, conclusion drawn therefrom, and order: FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent Lester Rothschild is an individual and lor the past four years has traded and is now trading and has transacted business under the name "Gen- Pak Company," with his office and principal place of business located at 139 North Clark Street, Chicago 2, Illinois. As a part of his business and from the same address for the purpose of obtaining information for customers he has also operated for the past two years under the trade name American Deposit System" and for the past year under the trade name "l\lanpower Classification Bureau.

PAR. 2. Respondent's business consists of the sale of post cards and letters, coupled with a service in the use thereof to ereditor-purehasers in obtaining information relative to their delinquent debtors, including the furnishing of penpoints and a small sum of money (3 cents), the entire cost of which being included in the price charged and received for the post eards and letters. Respondent formulates, prints or has printed two forms of double post cards, both of which he sells and ships in substantial quantities from Chicago, Illinois, to purchasers located in various States of the United States for use in locating delinquent debtors. One form designed to be sent to the delinquent debtor is as follows:

Office of the Gen- Pak Co.

139 North Clark Bldg.

Chicago 2, Illinois.

Dear Friend:

We are holding a package which we will send to you, upon receipt of the attacbed postcard, with complete identification filled in. We will bold same at YOUR risk, subject to YOUR forwarding directions for 30 days and full and complete identification. There are NO charges whatsoever, and package will be sent to you all charges PREP AID.

Yours very truly, THE GEN- PAK Co.

_. ,. Findings . 48 F. T. C. On the reply portion of this card, which is addressed to Gen- Pak Company, there is printed a form containing questions with respect to the debtor as follows:

MAIL THIS CARD TO US AT ONCE THE GEN- P AK COMPANY CITY HALL SQUARE BLDG.

CHICAGO 2, ILLINOIS Package Identification Checked Number Dept. Unidentified Charges No Charges Please send package (fully prepaid) to me. My correct address and identification is as follows.- - SEND THE ABOVE PACKAGE TO Print Correct N ame- - - - - - - - - - - - - - - - - - - Print Correct ~ ~ A d dress - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Print 0 ~ Ci t Y - - - - - - - - - - - - - - - - - - - - - - - - - - - - - S tate - - - - - - - - - - - PARTY MUST BE IDENTIFIED For identification I refer you to my employer, my bank and friend. Bank_- - - - - - Address__- - - - - - - - - - City - - - - - - - - - - Employer - - - - Address- City - - - - - - - - - Dept. -------------- ------------- Check No. Friend- - - - Address____- - - - - - - - - - - City - -- -- - - - ALL questions must be ANSWERED, or package will NOT be sent GENERAL DESCRIPTION OF :MYSELF Color Hair - - - Color Eyes - - - - Height- - - - Weight_--___- -- - - Age___- ------- It Married gs Mate s First Name--__-- -- --- - NO POSTAGE OR ADDRESSING NECESSARY Copyrighted 1948 by Gen- Pak Co.

Another double post card form designed to be sent to persons other than the debtor is as follows:

::;+p., +g:! GEN- PAK CO., ETC. 1061 1047 Findings The Gen- Pak Co.

139 North Clark Bldg.

Chicago 2, Illinois.

Dear Friend:

We have on hand a package which we wish to deliver to the party whose name and last known address appears in the left hand margin of the attached postcard, but we are unable to make delivery, since we do not know where he now resides. Will you be kind enough to give us the CORRECT address on the attached PREPAID reply card, to enable us to effect delivery? If, however, you do not know the correct address of this party, can you suggest SOMEONE who may be able to assist us? Thanking you in advance for any help you can give, and appreciating a prompt reply, we remain Cordially yours, THE GEN- PAK COMPANY.----- ----- The reply portion of this card, which is addressed to the Gen- Pak Company, contains questions with respect to the debtor as follows: PLEASE REPLY PROMPTLY IDENTIFICA TION Checked NUMBER Dept. ADDRESS Charges PLEASE PRINT ANSWERS CORRECT ADDRESS OF PARTY IS I Q;) Employer - - - City ------ - State- - - - - - - Address- NAME AND ADDRESS OF RELATIVE OR FRIEND Name (A)____- Address____- - - - - - - - - - City ------ - State- - - - - - - ~J5~g:! Q;) Name (B) - Address____- - - - - - - - - - - City - - - State - - - - - - - - - - - - - IF YOU ARE UN ABLE TO HELP US Whom Do You Suggest? Name - - - - - - - - - - - Address____- -- -- - - - - -- City ---- - - State- - - - - - t11 THE GEN - P AK CO MP ANY I en Q;) Q;) CHICAGO 2, ILLINOIS s .e g:! "0 Copyrighted 1950 by Gen- Pak Co.

PAR. 3. Respondent's customers address the cards purchased from respondent, as set forth in Paragraph Two, to their debtors or others Findings 48 F.'.

from whom information concerning their debtors is sought and cause them to be transported from their places of business located in various States of the United States to respondent in Chicago, Illinois. Respondent then deposits the individual cards in the United States mail. The return portion or about one-third of the cards mailed to each customer are filled out by the addressees and returned by mail to respondellt who forwards them in commerce from his place of business in Chicago, Illinois, to the proper customer located in a State other than the State of Illinois whom he is able to identify by a serial number stamped 'On the cards prior to their sale and delivery to the customer. Respondent then sends to the debtor or to the person who supplies the information as aforesaid three pen points enclosed in a small envelope together with advertising circulars of other products sold by him. The pen points have a monetary value 'Of approximately 3 cents which was included in the purchase price of the cards. PAR. 4. By the use of the cai'ds described in Paragraph Two, respondent has falsely represented, and placed in the hands of his customers a means of falsely representing, directly or by implication to customers' debtors, and others from whom information concerning such debtors is sought, that such debtors are consignees of packages sent by firms other than respondent and in the hands of respondent in the usual course of his business; that the shipments or packages held for the persons to whom the cards were addressed have been prepaid by the consignor and that the packages are held by respondent only for forwarding purposes; that the packages are of substantial value and that delivery cannot be made because of lack of identification or address.

PAR. 5. The said representations set forth in Paragraph Two are false and lnisleading. Respondent's business has, so far as the recipients of said cards are concerned, nothing to do with transportation or packages or their delivery to the proper consignees. The persons concerning whom information is sought are not consignees of packages sent by others and in the hands of respondent for delivery. The packages to which the cards refer are those made up by respondent containing the pen points and advertising matter relating to pen points collection agencies, etc., and respondent's whole scheme is that of obtaining information by subterfuge. Respondent's only purpose in connection with the sale and distribution of the cards is to place in the hands of his customers the means of obtaining information by subterfuge, and the said cards have no substantial connection with the sale and distribution of other products sold by respondent. PAR. 6. Respondent also sells and distributes in commerce, as described in Paragraph Two, form letters which are used by his cus- :

GEN-O-PAK co. , ETC. 1063 1047 Findings tomeI'S to secure information from debtors and others and which are designed to be sent by respondent's customers to debtors and others from whom information is sought. Among such form letters is one designated "11anpower Classification Bureau Type Information Letter. This letter is as follows:

MANPOWER CLASSIFICATION BU;REAU 139 NORTH CLARK BLDG.

CHICAGO 2, ILLINOIS CLASSIFICATION No. D AREA 6 ZONE 211- You are requested to promptly fill out and return this Questionnaire, answering each question where applicable, so that this Bureau can properly classify the kind of work ~TOU are best qualified to perform. 1. If in Military Service give Military Serial Number u_----_uu-u- and check here - - u U - U - and do not answer any other questions. 2. If unable to work at all~check here- 3. If male check here -------- If female check here Race-vVhite uu_- Negro u_--- Oriental ------ Indian uuu 4. Are you subject to Military Service? Yes __n- No _uu Rejected ----- If previously in Military Service give old Military Serial Number here - - - - - 5. What kind of work are you best fitted for-check one: Industrial - - u -- Agricultural - u - - Selling - - -- - - Professional - - - Unskilled labor - - Skilled labor (State kind) - - 6. By whom are you now employed? Employer - u U U - - Address - - - City - State u_----_u--u_--- Dept. ---_u_--------- Social Security No. -_u _u- - Type of work -- - -- - --- - - Clock No. u - -- u- uu If not employed NOW name LAST employer Address u - U -- - - City - - -- u - - State - - -- - - u u - Dept. - u - - Clock No. - - u - - Type of work- - u - - -- 7. Are you willing and able to accept employment in some other part of the United States? Yes u - - No - - u - 8. Approximate wages you are now or last received $-------_uu_- weekly. 9. Are you Married -- - - Single -- Co Separated - - -- - - Divorced - - Mate deceased - 10. If married, what kind of work does your mate perform? --uu_--_u_----- 11. If married, is your mate willing to accompany you to a new geographical location? Yes __un No ------ 12. Your approximate age ------- Your mate s name ------- Age 13. It!; the above address correct? Yes uu_- No -------- If not give correct address here - -- -- - - - u - - - u -- - City - State - - If yes, what . Do you own an automobile? Yes -------- No ---_u-make - - u - - u - - Year - - License N umber - - - - Sign here - - - PLEASE TYPE or PRINT ANSvVERS AND RETURN IN THE PREPAID SELF ADDRESSED ENVELOPE ENCLOSED Findings 48 F. T. C.

This Bureau is not a part of any U. S. Government Division DO NOT WRITE IN THIS SPACE Area ---_u_--- Class. --u_u- Trans. -----_u Non-Tr. u_--- Voc. --_uuu- Spec. -_u__u- Mil. --_u_---- Non-Mil. _uu Male ---_uuu Fem. -_uuu- File -_u_u_-- Age u__u__u Copyrighted 1950 Man-CIa-Bur.

This letter is accompanied by a business reply envelope addressed to the Manpower Classification Bureau, 139 North Clark Bldg., Chicago 2, Illinois, which is the respondent's business address. Respondent also sells in commerce as described in Paragraph Two n form letter designated "The American Deposit System Type C Information Letter" which is as follows:

(Double eagle coat of arms or crest) THE AMERICAN DEPOSIT SYSTEM 139 NORTH CLARK STREET CHICAGO 2, ILLINOIS (Type " C"

Date - - (Space for name and address) (Your File Number Here) Page 751Re: DISBURSEMENT NO. C Vol. ---_u Book -_u_- It you are the party as addressed above, and you will fill in the answers to the information requested below, we will forward to you a small sum of money deposited with us, for you, for that purpose. ALL questions must be answered, so we can determine if you are the proper party. VOID 90 DAYS AFTER ABOVE DATE 1. Are you the party as addressed above? YES - NO_____- 1a. If your answer to the above is NO, then what relation are you? -_u_-_u- If your answer was YES, you need not answer this question. 2. Is the above address correct? YES u_u- NO uuu If your answer is NO, what is the correct address? _u_-_uu_-_uuuuu City _u_-u- State _uu u - _u- 3. Are you SINGLE -_u_--- MARRIED uuu_- DIVORCED u-_u- SEPARATED uu_--- 3a. If married, what is your mate s complete name - - - u - - u - - u - - 4. Are you employed NOW? YES _u_u NO _u_u 5. If your answer to the above is YES, by "whom are you employed? Name Address --------------- City -------------- State _uu- -- - _u- - - Dept. - uuu - U U - Check No. u - uu ---- 5a. If your answer is NO, then answer by whom you were LAST employed. Name u_-_uu_uu Address _uuuu_---- City --------_uu_-- State - u - - u u - u u Dept. u - - Check No. - - u - - - u - u -- GEN-O-PAK co., ETC. 1065 1047 Findings 6. If married, state by whom your mate is employed City - - -- State -- -- - - Dept. - - Check No.__--_----- 6a. If single, do not answer this question. 7. At what address did you LAST reside? City ---------- Give names and addresses of two references who can identify you. 8. State ---------------- 1. - - - 2. - - 9. My automobile license number is or: I do not own an automobile.

10. Where do you bank? or: I have no bank account. 11. I hereby affirm that I am the above party. SIGN HERE - PLEASE TYPE OR PRINT INFORMATION AND RETURN IN THE PREPAID SELF ADDRESSED ENVELOPE HEREWITH ENCLOSED. Copyright 1950 Amer. Dep. Sys.

This form also is accompanied by self-addressed envelopes addressed to American Deposit System, 139 North Clark Street, Chicago 2, Illinois, which is the business address of respondent. Respondent' s purchasers or customers address the form letters to their debtors or others from whom information concerning debtors is sought and cause them to be delivered to respondent in Chicago Illinois. Respondent then deposits the individually addressed form letters in the United States mails. Such of the forms as are filled out and mailed by the recipients and are received by respondent are sent by him to the proper customer whom he is able to identify by a serial number stamped on the forms prior to their sale and delivery to the customer.

The recipients of the form letter headed American Deposit System who send in the information requested are then sent a sum of moneyconsisting of 3 cents. PAR. 7. By the use of the statements in the Manpower Classification Bureau form letters referred to in Paragraph Six and the name Manpower Classification Bureau, respondent has falsely represented and placed in the hands of his customers a means of falsely representing, directly or by implication, to customers' debtors and others from whom information concerning such debtors is sought, that respondent is engaged in operating a labor classification bureau or other bureau for the purpose of obtaining information as to the manpower or employment situation or the availability of manpower in certain areas and that the information desired is in connection with such manpower or employment situation. Respondent' s business has, so far as the 1'e- 1066 FEDERAL TRADE COML.lission DECISIONS Order 48 F. T. C.

cipients of said form letters are concerned nothing to do with manpower classification or employment surveys and respondent' s only purpose in connection with the sale and distribution and mailing of said form letters is to place in the hands of its customers the means of obtaining information relating to delinquent debtors by subterfuge. By the use of the statements in the American Deposit System form letters referred to in Paragraph Six and the name American Deposit tSystem, respondent has falsely represented and placed in the hands of his customers a means of falsely representing, directly or by implication, to customers' debtors and others from whom information concerning such debtors is sought, that respondent has been named as depository of a reasonably substantial sum of money to be delivered to the recipients of said form letter upon proper identification by furnishing all of the information requested. Respondent is not engaged in any fiduciary or other capacity to receive money for the persons to whom the form letters are sent, and the only money sent them is 3 cents which is included in the price charged respondent' customers for the form letters.

PAR. 8. The use of the cards and form letters, containing the false and misleading statements and representations set forth in the preceeling paragraphs, has the tendency and capacity to mislead and deceive many persons to whonl the cards and form letters were sent into the erroneous and mistaken belief that the statements and representations contained thereon and therein were true and by reason thereof to furnish the respondent and his customers information which they would not otherwise supply.

CONCLUSION Th.3 acts and practices of the respondent as set forth in the findings of fact are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDER It is ordered That respondent Lester Rothschild, individually and trading as Gen- Pak Company, or under any other name, and his representatives, agents, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale and distribution, or use in commerce, as "commerce" is defined in the Federal Trade Commission Act, of forms, letters, cards, or any other written or printed material for use in obtaining information concerning debtors or alleged debtors, do forthwith cease and desist from: GEN- PAK co. , ETC. 1067 1047 Order (1) Using, or placing in the hands of others for use, any stationery in connection with the location of delinquent debtors or the collection of nloney due by a delinquent debtor, containing respondent' s name, or any trade name used by him, unless the words "Collection Service appear immediately in connection or conjunction therewith in type of like or equal size.

(2) Representing, or placing in the hands of others means of representing, directly or by implication, that money or other property is being held for persons concerning whom information is sought that the information sought is for use in determining whether the person about whom information is requested may be the person for whom money or other property has been deposited, unless money or other property has in fact been so deposited and the amount of money or description or value of the property is accurately stated. (3) Using the words ":Manpower Classification Bureau " or any other words, which import or imply that respondent's business is that of gathering and furnishing information relative to employment, or that respondent's business is other than that of obtaining informalion concerning debtors or alleged debtors. ( 4) Using the name "American Deposit Systenl" or any other name which imports or implies that respondent is a depository or is engaged in the business of receiving and holding money for persons from whom or about whom information is sought. (5) Using or placing in the hands of others for use forms, letters (',ards ~ or any other printed or written material which represents directly or by implication, that respondent's business is other than that. of obtaining information for use in the collection of debts. ORDER TO FILE REPORT m~ COMPLIANCE 1 t is fu/J'ther orde'/' That the respondent shall, within sixty (60) days after service upon him of this order, file with the COllllnission a report, in writing, setting forth in detail the manner and form in which he has complied with the order to cease and desist (as required by aforesaid order and decision of the Commissions. Syllabus 48 F. T. C.