The Federal Trade Commission settled with a California retailer accused of tricking British customers into believing its site was based in the United Kingdom.
Jaivin Karnani, of the company Balls of Kryptonite, allegedly sold products through several Web sites using the British top-level domain, co.uk.
British customers believed that they were purchasing goods protected by warranties in the UK and were surprised by high import fees, the FTC said in a release. Customers who tried to cancel their orders complained that the company did not respond or tried to charge high cancellation fees.
The settlement order prevents the company from misrepresenting the location of its goods and from charging customers for items until they are “in hand and ready to be shipped.”
The defendants are also not allowed to misrepresent their compliance with government-sponsored information security programs, their own sales policies and the total cost of goods.
The company was charged with $500,000 judgment, which has been waived based on its inability to pay.