Defendants: Crescent Publishing Group, Inc., Arachne, Inc., Back Break, Inc., Base Stealer, Inc., Bird N Bee, Inc., Bird of Paradise, Inc., Black Crow, Inc., Blast High, Inc., By Coastal, Inc., Casey Baby, Inc., Cheri, Inc., Crack Back, Inc., Daedalus, Inc., Daphne, Inc., Doric, Inc., Frau, Inc., Gold Finch, Inc., Green Parrot, Inc., Grey Dove, Inc., Grisette, Inc., Hades, Inc., Hoot Owl, Inc. Icse, Inc., Kick Over, Inc., Kick Turn, Inc., Kishkus, Inc., Klept, Inc., Knock Knee, Inc., Lackadaisical, Inc., Left Fielder, Inc., Lemon Zing, Inc., Lsthya, Inc., Marius, Inc., Maxmann, Inc., Menelaus, Inc., Muck-A-Muck, Inc., Multiline Media, Inc., Multimedia Forum, Inc., Multiple Factor, Inc., Nerve Wracking, Inc., NetTV, Inc., Off Year, Inc., Online Forum, Inc., Palantine, Inc., Persephone, Inc., PGTV 1, Inc., PGTV 2, Inc., Phocas, Inc., Pink Flamingo, Inc., Pliny, Inc., Right Fielder, Inc., Romulus, Inc., Scarecrow, Inc., Senora, Inc., Sisyphus, Inc., Speckled Sparrow, Inc., Split Back, Inc., Spruce, Inc., Stray Back, Inc., Trajan, Inc., TXA, Inc., Vespasian, Inc., Vestals, Inc., Wacky Back, Inc., White Cedar, Inc., and Bruce Chew and David Bernstein

Type:  Illegal Credit Card Billing

The FTC and the New York Attorney General’s office brought a joint action in federal court against New York City-based Crescent Publishing Group, Inc., its owner, Bruce Chew, principal David Bernstein, and 64 affiliated corporations that operated adult entertainment Web sites such as www.highsociety.com and www.playgirl.com. The FTC alleged that defendants promoted scores of adult entertainment Web sites as "free" and purportedly required credit card numbers from consumers only to prove that they were adults. In fact, according to the FTC, thousands of consumers were charged recurring monthly membership fees ranging from $20 to $90, and consumers who tried to dispute the charges were met with a variety of barriers. The FTC alleged that defendants generated $141 million of revenue in the first 10 months of 1999 alone and routinely changed corporate billing names to avoid detection. When Visa U.S.A. disqualified them from using its credit card system, defendants allegedly moved their merchant banking accounts to Guatemala and adopted several new merchant names.

On November 5, 2001, the FTC announced that defendants agreed to pay $30 million to settle Federal Trade Commission and New York State's Attorney General's charges that they illegally billed thousands of consumers for services that were advertised as "free," and billed other consumers who never visited the Web sites at all. The settlement bars the illegal practices in the future, and requires that the defendants post a bond - $2 million for the corporate defendants and $500,000 each for the individual defendants - before they are allowed to continue to market adult entertainment on the Internet.