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Thirty-four States Settle with YP Corp

December 14, 2006

Thirty-four states1 reached a settlement with YP Corporation and its subsidiary, Telco Billing, Inc. d/b/a YP Corp., YP.com, and Telco Billing, Inc., resolving allegations the company deceived consumers by automatically signing them up for its online yellow pages. According to the settling states, the company sent businesses and other organizations "live" activation checks for approximately $3.50. On the back of the checks, in fine print above the endorsement line, the company placed language stating that, by depositing the check, the recipient agreed to purchase online advertising. Endorsing and cashing the check also authorized YP Corp. to bill the monthly fees in advance. Under the agreement, YP Corp. will cease using the checks to obligate businesses to purchase its products and services. YP Corp. also agreed to pay $2 million in restitution and investigatory costs.

1Alaska, Arizona, Arkansas, California, Connecticut, Delaware, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Michigan, Minnesota, Missouri, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Jersey, North Carolina, North Dakota, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Washington, West Virginia, and Wyoming.

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