- The Washington Times - Saturday, February 23, 2002

The federal government and Miss Cleo's psychic hot line have reached a temporary agreement allowing the telephone service to continue predicting while an investigator looks into charges that it has defrauded customers.
U.S. District Judge Alan Gold of the Southern District of Florida has approved a settlement with the Federal Trade Commission (FTC) under which a court-appointed auditor will monitor all activities of Access Resource Services Inc. and Psychic Readers Network.
The two Fort Lauderdale, Fla., companies have a national network of "psychic readers," led by Jamaican soothsayer "Miss Cleo," that promises insights in matters of love and money.
Under the preliminary injunction, the companies are required to disclose in their ads the cost of their pay-per-call service, stop broadcasting that callers receive a "free reading," and suspend using toll-free numbers in ads without disclosing that the service can only be accessed through 900 numbers.
The FTC said the injunction will be in place until the court issues a final ruling on the allegations.
New York lawyer Sean Moynihan, who represents the two companies, said the businesses felt vindicated by the agreement because in the lawsuit filed on Feb. 14, the FTC had sought to freeze their assets and end their operations.
He said they look forward to working with the FTC and demonstrating how their business works but regret that wasn't done before the lawsuit was filed. Had the agency done so, he said, "We would have explained how all the business practices are lawful."
The FTC, in its fraud lawsuit, said that the service, in addition to misrepresenting costs both in advertising and during the time the calls are made, billed for services never purchased, harassed consumers with unwanted telemarketing calls, and responded to consumer complaints with abusive, threatening language.
The agency's director of consumer protection, Howard Beales, said the FTC acted after getting more than 2,000 complaints.
He said the service promises a free psychic reading, but when consumers call a toll-free number, they are directed to a 900 number charging $4.99 a minute. Nearly 6 million people have called the service, with an average call costing more than $60, Mr. Beales said.
The companies have been sued by at least eight other states, and Florida authorities have a separate lawsuit challenging "Miss Cleo," Youree Dell Harris, to prove that she really is a renowned shaman from Jamaica.

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