Using fake news Web sites designed to look like legitimate news sites, Pure Green Coffee made bogus claims that its coffee bean extract could help users lose weight and burn fat, according to a new suit brought by the Federal Trade Commission.

The Florida-based company and several executives were named in the agency’s complaint, which charges the defendants with violations of Section 5 of the FTC Act. Just weeks after green coffee was promoted on the April 26, 2012 episode of The Dr. Oz Show, the company began marketing Pure Green Coffee extract at $50 for a one-month supply. Since May 2012, the defendants have sold more than 536,000 bottles of the product.

The FTC alleged that, in addition to the misleading footage from the popular TV show to promote the Pure Green Coffee product, the defendants failed to disclose that some customers were paid $200 for video testimonials and received a 30-day supply of supplement for free in exchange for an endorsement. Furthermore, the FTC said that ads on at least 11 Web sites that were built to look like news sites, made it “impossible for people to know whether they were seeing news or an ad.”

The purported news sites featured mastheads of fake organizations (such as “Women’s Healthy Journal” and “Healthy Living Reviewed”) and logos from real organizations (such as MSNBC and CNN) to make what the agency alleged were false and unsupported advertising claims that consumers using Pure Green Coffee could lose 20 pounds in four weeks and four to six inches of belly fat in three to five months.

Other claims were based on faulty studies that “proved” the product could result in weight loss and body fat loss (an average of 10.5 percent and 16 percent) without diet or exercise and unsupported statements such as “Drop 3 Dress Sizes Buy Pure Green Coffee” and “Discover the Shocking Truth About America’s Hottest Diet.”

To read the complaint in FTC v. NPB Advertising, click here

Why it matters: The case raises a few hot-button issues for the FTC – endorsements and testimonials, substantiation for weight loss claims, and fake news sites. “Not only did these defendants trick consumers with their phony weight loss claims, they also compounded the deception by advertising on pretend news sites, making it impossible for people to know whether they were seeing news or an ad,” Jessica Rich, director of the FTC’s Bureau of Consumer Protection, said in a statement about the case. The agency has taken a dim view of false weight loss claims coupled with phony news sites in the past, having conducted a law enforcement sweep in April 2011 against the marketers of acai berry weight loss products who operated fake news sites.