                             In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 04-2173
FEDERAL TRADE COMMISSION,
                                                 Plaintiff-Appellee,
                                 v.

BAY AREA BUSINESS COUNCIL, INC., a Florida
Corporation, BAY AREA BUSINESS COUNCIL CUSTOMER
SERVICE CORP., a Florida Corporation, AMERICAN
LEISURE CARD CORP., a Florida Corporation, et al.,

                                     Defendants-Appellants.
                          ____________
            Appeal from the United States District Court
       for the Northern District of Illinois, Eastern Division.
             No. 02-C-5762—John W. Darrah, Judge.
                          ____________
     ARGUED MAY 6, 2005—DECIDED AUGUST 25, 2005
                    ____________


  Before KANNE, ROVNER, and WOOD, Circuit Judges.
  ROVNER, Circuit Judge. In 2002 the Federal Trade Com-
mission (“FTC”) initiated an action for injunctive and other
equitable relief against several Florida corporations and
their officers and directors. See 15 U.S.C. §§ 53(a)-(b)
(giving FTC power to bring suit in district court and seek
preliminary injunction), 57b (authorizing FTC to bring suit
and seek equitable relief); 15 U.S.C. § 6101-08 (Tele-
marketing and Consumer Fraud and Abuse Prevention
Act). The FTC alleged that the following interrelated
corporations, run by Peter Porcelli, Bonnie Harris, and
2                                                  No. 04-2173

Christopher Tomasulo, engaged in deceptive trade practices
in violation of section 5(a) of the Federal Trade Commission
Act (“FTC Act”), 15 U.S.C. § 45(a), and the Telemarketing
Sales Rule (“TSR”), 16 C.F.R. § 310.1-10.9: Bay Area
Business Council, Inc. (“BABC”); Bay Area Business
Council Customer Service Corp. (“BABC Customer Ser-
vice”); American Leisure Card Corp. (“American Leisure”);
Bay Memberships, Inc.; Bay Vacations, Inc.; and Sr.
Marketing Consultants, Inc. In particular, the FTC alleged
that the defendants misled consumers into believing that
they would receive a credit card in exchange for a hefty
“one-time” fee. The district court granted the FTC’s motion
for summary judgment against all of the corporate defen-
dants and Porcelli and Harris. The defendants appeal, and
we affirm.


                               I.
  The FTC based its action on an alleged telemarketing
scheme run primarily out of Largo, Florida. Managing
BABC and later American Leisure, Porcelli contracted with
a telemarketing company in Utah1 to call consumers
throughout the United States who had recently applied
for and been denied consumer credit. Referring to those
credit applications, telemarketers opened by saying, “Our
records indicate that within the past 12 months, you filed
an application for a credit card and you are now eligible
to receive your MasterCard.” After answering a few short
“verification” questions, consumers were told that they were
“guaranteed to receive a MasterCard that does not require


1
  Although not a named defendant in this case, the Utah
telemarketing company, Assail, Inc., was the subject of an FTC
action filed in the Western District of Texas. See FTC v. Assail,
Inc., 410 F.3d 256, 259 n.1 (5th Cir. 2005) (describing tele-
marketing “scheme” selling worthless “MasterCards”).
No. 04-2173                                               3

a security deposit with an initial pay as you go limit of
$2000.”
  In addition to the “MasterCard,” consumers were prom-
ised a “fabulous” Florida vacation and a free 30-day trial
“BABC membership.” These offers, however, did not figure
prominently in the script, which focused on the
“MasterCard.” The card was offered as a way to boost
flagging credit ratings, as demonstrated by the following
scripted promise: “[N]othing [customer name] looks better
on your Equifax credit report than a MasterCard.”
  This supposed opportunity, however, came at a cost.
Telemarketers explained that “like most cards there is
a one time processing [fee] of $174.95 plus shipping and
handling, which covers the cost of processing the Master-
Card order and getting the vacation package delivered to
you on a priority basis.” In order to pay the fee, consumers
were required to provide personal account information.
After obtaining an account number and securing agreement
from the consumer, telemarketers played an automated
“disclosure” concluding with, “you agree to everything we
spoke about over the phone today, Correct?” Within days of
the call, BABC and American Leisure debited customer
accounts for anywhere from $199 (including “shipping and
handling”) to $499.
  Some time later, customers received the “MasterCard”
and accompanying package from BABC or American
Leisure. Instead of a credit card, the package contained an
“acceptance form” for a “ChexCard™ MasterCard®.” The
card stated “Bay Area Business Council” prominently across
the top and contained a copy of the MasterCard logo in the
lower right-hand corner. The back contained a meaningless
painted-on black stripe in place of the customary magnetic
strip on credit and debit cards. The explanatory material
revealed that the card was a “stored value card” that the
customer could receive only after mailing in a $15 activa-
4                                               No. 04-2173

tion fee. After the actual card arrived (four to six weeks
later), it could only be used if a customer pre-loaded his or
her own funds onto it.
  In addition to the inoperable “ChexCard,” customers
received information on redeeming their free vacation (a
time share presentation) and on their BABC “membership.”
The “membership” supposedly entitled consumers to take
advantage of numerous “free” goods and services, such as
gasoline, nationwide long distance, internet access, voice
mail, and film developing. Although this was not mentioned
in the materials, the privilege of BABC membership cost
the consumer $10 a month. The only notice of the fee was
contained in the automated “disclosure” played in the initial
sales call, where it was revealed that the $10 would be
taken directly from the consumer’s account each month.
  Not surprisingly, BABC received a host of complaints
from customers who thought they had been going to receive
a credit card. Incorporated separately but doing business
under the name Bay Area Business Council, BABC Cus-
tomer Service handled customer’s complaints and requests
for refunds. Special Technologies, Inc. essentially succeeded
BABC Customer Service in July 2002. Both operated from
a suite in Largo next to the offices of Porcelli and Harris.
That suite received all calls placed to the toll free numbers
for BABC, American Leisure, Sr. Marketing Consultants,
and Bay Memberships, Inc. In addition to calls from
disgruntled consumers, corporate records reveal that
between November 2001 and July 2002, BABC received
over 900 written consumer complaints forwarded from the
Better Business Bureau, state attorney generals’ offices,
and private lawyers.
  The remaining corporate defendants also worked in
conjunction with BABC. Like BABC Customer Service, Sr.
Marketing Consultants, Inc. did business under BABC’s
name. Sr. Marketing Consultants, however, had only
No. 04-2173                                                  5

four employees, three of whom were related to Porcelli.
They operated from Porcelli’s mother-in-law’s home in
Dunedin, Florida. Sr. Marketing Consultants charged
BABC and American Leisure for the “ChexCards,” and
then, through a series of transactions, gave the proceeds
to Harris, who handled most of BABC’s finances. At the end
of July 2002, Porcelli created Bay Memberships, Inc. as a
way to ensure that banks, which had begun refusing to
process payments to BABC and American Leisure, would
continue to charge customers. In the three weeks that Bay
Memberships, Inc. operated, it processed approximately
$200,000 in debits from customer accounts. Although it is
not entirely clear from the record, Bay Vacations, Inc. was
apparently another shell corporation doing business for
BABC.
  In August 2002, the FTC filed its action alleging that
BABC, Inc., BABC Customer Service, American Leisure,
Porcelli, Tomasulo, and Harris violated Section 5(a) of the
FTC Act, 15 U.S.C. § 45(a), and multiple provisions of the
TSR by engaging in deceptive trade practices. The FTC
later amended its complaint to name Bay Memberships,
Inc., Bay Vacations, Inc., and Sr. Marketing Consultants,
Inc. as defendants (collectively the “corporate defendants”).
The FTC also secured an ex parte temporary restraining
order with an accompanying freeze on the defendants’
assets. On August 15, 2002, a temporary receiver, accompa-
nied by FTC employees, entered the corporate defendants’
premises in Largo, Florida to seize business records and
shut down operations pursuant to the restraining order.
  After conducting extensive discovery, the FTC moved for
summary judgment against the corporate defendants,
Porcelli, and Harris.2 With its motion the FTC filed the


2
    The district court later approved a stipulated settlement
                                                 (continued...)
6                                               No. 04-2173

required Northern District of Illinois Local Rule 56.1(a)(3)
statement of undisputed material facts. In response to the
FTC’s motion, the defendants filed a document averring
that an attached affidavit sworn by Porcelli contested “the
vast majority of all facts listed as undisputed by the FTC.”
The defendants also submitted affidavits from three former
BABC employees and one former BABC Customer Service
employee. The affidavits made the following three asser-
tions: (1) that most BABC consumers who called asked
about their vacation package, not about a credit card, (2)
that BABC had a consumer refund policy, and (3) that
Porcelli was in Canada from May 2002 until shortly after
BABC was shut down by the FTC in August. The district
court concluded that the defendants’ response failed to
comply with Local Rule 56.1. It thus accepted as true all the
facts in the FTC’s Rule 56.1 statement.
  On that record, the court granted the FTC’s motion for
summary judgment. The court concluded that the undis-
puted facts established that the defendants had violated
section 5 of the FTC Act by misleading reasonable consum-
ers into believing they would receive a credit card. See 15
U.S.C. § 45(a) (forbidding deceptive practices affecting
commerce). This deception, the court concluded, also
violated 16 C.F.R. § 310.3(a)(2)(iii) (prohibiting misrepre-
sentations about any material aspect of a sales offer) and
§ 310.3(a)(4) (forbidding misleading statements to induce
payment for goods). And the court determined that the
defendants violated 16 C.F.R. § 310.3(a)(1)(i) by failing to
tell consumers about the extra $15 fee required to obtain
the “ChexCard,” id. (requiring clear and conspicuous


2
  (...continued)
agreement between the FTC and the sole remaining defendant,
Christopher Tomasulo. The agreement contemplates Tomasulo’s
adherence to a permanent injunction that mirrors the one
ultimately entered against the other defendants.
No. 04-2173                                                   7

disclosure of all costs associated with goods offered for sale).
Finally, the district court concluded that Porcelli and Harris
were individually liable for the corporate defendants’
deceptive practices because both had authority to control
the corporate defendants and knew about their deceptive
practices. The court then entered an order permanently
enjoining the defendants from telemarketing, promoting or
selling credit-related products, making misleading state-
ments to consumers, failing to comply with the TSR, or
disclosing any information about customers except to the
FTC. The court also held the corporate defendants, Harris,
and Porcelli jointly and severally liable for $12.5 million in
consumer redress. See 15 U.S.C. § 57b(b) (giving court
jurisdiction to authorize consumer redress for a corpora-
tion’s deceptive trade practices).


                              II.
   The defendants’ primary argument on appeal concerns
the district court’s enforcement of Northern District of
Illinois Local Rule 56.1. That rule requires parties mov-
ing for summary judgment to submit with their motion
“a statement of material facts as to which the moving party
contends there is no genuine issue and that entitle the
moving party to a judgment as a matter of law.” N.D. Ill. R.
56.1(a)(3). The statement must be organized by numbered
paragraphs and refer to the “affidavits, parts of the record,
and other supporting materials” that substantiate the listed
facts. The party opposing summary judgment must then
submit a response to each numbered paragraph, “including,
in the case of any disagreement, specific references to the
affidavits, parts of the record, and other supporting materi-
als relied upon.” Id. 56.1(b)(3)(A). The reply must also
contain numbered paragraphs with “any additional facts
that require the denial of summary judgment,” supported
by citations to the record. Id. 56.1(b)(3)(B). Finally, the rule
8                                                No. 04-2173

provides that “[a]ll material facts set forth in the statement
required of the moving party will be deemed to be admitted
unless controverted by the statement of the opposing party.”
  Concluding that the defendants’ affidavits did not comply
with the strictures of the rule, the district court disregarded
them. The defendants, however, maintain that the district
court should have considered Porcelli’s thirty-three page
affidavit, which they believe complied with Rule 56.1. They
characterize the statements in Porcelli’s affidavit as
“admissible evidence” and insist that he responded to the
undisputed facts listed by the FTC. We review the district
court’s enforcement of the local rules for an abuse of
discretion. E.g., Ammons v. Aramark Uniform Servs., Inc.,
368 F.3d 809, 817 (7th Cir. 2004). Because of the important
function local rules like Rule 56.1 serve in organizing the
evidence and identifying disputed facts, we have consis-
tently upheld the district court’s discretion to require strict
compliance with those rules. See Koszola v. Bd. of Educ.,
385 F.3d 1104, 1109 (7th Cir. 2004); Ammons, 368 F.3d at
817; Bordelon v. Chi. School Reform Bd. of Trustees, 233
F.3d 524, 527 (7th Cir. 2000); Waldridge v. Am. Hoechst
Corp., 24 F.3d 918, 922 (7th Cir. 1994) (collecting cases).
  We are hard-pressed to see how Porcelli’s affidavit
could constitute compliance with Rule 56.1. The defendants
insist that Porcelli’s affidavit “specifically addressed in
corresponding paragraph numbers” the facts in the FTC’s
Rule 56.1 statement. This is untrue. By way of example, the
eighth paragraph in the FTC’s Rule 56.1 statement asserts
that American Leisure did business as “First American
Leisure Card” or “1st American Leisure Card.” In the
“corresponding” paragraph of his affidavit, Porcelli claims
to “deny, to [his] knowledge” that sales representatives led
consumers to believe that they would receive credit cards
for an advance fee. And paragraph twelve of the FTC’s Rule
56.1 statement says that BABC and American Leisure
entered into contracts with a company in St. George, Utah
No. 04-2173                                                  9

to telemarket for them. Paragraph twelve of Porcelli’s
affidavit, however, makes the unrelated claim that “BABC
and [American Leisure] telemarketing scripts . . . included
language regarding a vacation package.” As demonstrated
by the preceding examples, Porcelli’s affidavit in no way
constitutes “a concise response . . . to each numbered
paragraph” in the FTC’s statement. Indeed, many portions
bear no relationship at all to the facts set forth by the FTC.
  Moreover, with the exception of a sole reference to the
defendants’ answer to the FTC’s amended complaint,
Porcelli’s affidavit fails to cite a single piece of record
evidence to support its assertions. See Bradley v. Work, 154
F.3d 704, 708 (7th Cir. 1998) (“act of specifically correlating
evidence in the record to factual propositions” is “key” to
system prescribed by local rules such as 56.1). In short,
Porcelli’s affidavit utterly fails to conform with the require-
ments of Rule 56.1, and the district court had no obligation
to construe it as compliant. We have noted before that rules
like 56.1 “provide[ ] the only acceptable means of disputing
the other party’s facts and of presenting additional facts to
the district court.” Midwest Imports, Ltd. v. Coval, 71 F.3d
1311, 1317 (7th Cir. 1995). Instead of employing those
means, the defendants chose to submit Porcelli’s affidavit
and the affidavits of four of his former employees. Having
reviewed the affidavits, we concur in the district court’s
judgment that they consist of “unsupported and irrelevant”
conclusions. The court was thus well within its discretion to
reject the defendants’ submissions. See Ammons, 368 F.3d
at 817-18 (no abuse of discretion for court to strike re-
sponses that “simply denied an allegation and provided no
citation whatsoever”); Bordelon, 233 F.3d at 528-29 (uphold-
ing district court’s decision to strike statement “full of
argument, evasion, and improper denials”).
  We also reject the defendants’ related argument that
the district court “overlooked” evidence giving rise to dis-
puted issues of material fact. To uncover this evidence, the
10                                              No. 04-2173

defendants suggest the district court should have harked
back to affidavits submitted with their answer to the FTC’s
amended complaint and their motion in opposition to the
preliminary injunction. But local rules such as 56.1 exist
precisely because the district court is not “obliged . . . to
scour the record looking for factual disputes.” Waldridge, 24
F.3d at 922. Moreover, the affidavits are unhelpful because
many of the statements in them were subsequently discred-
ited by deposition testimony and other evidence uncovered
in discovery. See, e.g., Ineichen v. Ameritech, 410 F.3d 956,
963 (7th Cir. 2005) (reiterating rule that a party may not
create an issue of fact with an affidavit containing conclu-
sions that contradict depositions or other sworn testimony);
Balderston v. Fairbanks Morse Engine Div. of Coltec Indus.,
328 F.3d 309, 318-19 (7th Cir. 2003) (same).


                            III.
  Accordingly, in our de novo review of the court’s grant of
summary judgment, we consider only those facts in the
FTC’s Rule 56.1 statement, which is amply supported by
citations to the relevant record evidence. Although we
accept as true the facts in the FTC’s Rule 56.1 statement,
we still view them in the light most favorable to the
defendants in determining whether there exist disputed
issues of material fact. See Fed. R. Civ. P. 56(c); Anderson
v. Liberty Lobby Inc., 477 U.S. 242, 255 (1986); Laborers’
Pension Fund v. RES Env’t Servs., Inc., 377 F.3d 735, 737
(7th Cir. 2004). Although the defendants aver generally
that there are disputed issues of fact that make summary
judgment improper, nothing they point to undercuts the
FTC’s undisputed evidence that they engaged in unfair
trade practices, see 15 U.S.C. § 45(a), and violated multiple
provisions of the TSR, see 16 C.F.R. § 310.1-10.9.
  Section 5 of the FTC Act prohibits “unfair or deceptive
acts or practices in or affecting commerce.” 15 U.S.C.
No. 04-2173                                                 11

§ 45(a)(1). The FTC is empowered to initiate federal court
actions to enforce violations of section 5 and seek appropri-
ate equitable relief. Id. §§ 53(a)-(b), 57b. The FTC may
establish corporate liability under section 5 with evidence
that a corporation made material representations likely to
mislead a reasonable consumer. See FTC v. Tashman, 318
F.3d 1273, 1277 (11th Cir. 2003); FTC v. World Travel
Vacation Brokers, Inc., 861 F.2d 1020, 1029 (7th Cir. 1988).
The FTC is not, however, required to prove intent to
deceive. FTC v. Freecom Communications, Inc., 401 F.3d
1192, 1202 (10th Cir. 2005); FTC v. Amy Travel Serv., Inc.,
875 F.2d 564, 573 (7th Cir. 1989); World Travel, 861 F.2d at
1029. Additionally, the omission of a material fact, without
an affirmative misrepresentation, may give rise to an FTC
Act violation. Amy Travel, 875 F.2d at 573; World Travel,
861 F.2d at 1029. The corporate defendants do not dispute
the district court’s conclusion that they operated as a
“common enterprise” such that they are jointly and sever-
ally liable for the injuries caused by their violations of the
FTC Act and the TSR. We thus consider them collectively
when analyzing corporate liability.
  Throughout their brief, the defendants maintain that they
never sold a credit card. They characterize this issue as a
material fact in dispute. The FTC, however, does not
dispute that the defendants did not actually sell credit
cards. Indeed, their failure to provide a “credit card” lies at
the heart of this case. We take the defendants at their word
that they never sold a credit card. Unfortunately, they
misled consumers into believing that was exactly what they
were doing. See Freecom Communications, 401 F.3d at 1202
(in analyzing whether act or practice is deceptive, principal
inquiry is the practice’s likely effect on mind of ordinary
consumer).
  One look at the scripts used by telemarketers for BABC
and American Leisure confirms that the corporate defen-
dants misled reasonable consumers into believing they
12                                               No. 04-2173

would receive a credit card. The script opens by referring to
the consumer’s recent application for “a credit card.” The
potential customer is then told, “you are now eligible to
receive your MasterCard.” It is hard to imagine what
consumer would not construe this as an offer for a credit
card. Indeed, the entire script is tailored to giving consum-
ers that impression. From calling the card a “MasterCard”
to promising that nothing would look better on an Equifax
credit report, telemarketers gave consumers the impression
that they were going to receive a credit card in the mail.
Instead, they received a useless card with a MasterCard
logo. From that, a consumer could mail additional funds to
receive a functional “ChexCard,” which could only be used
when the consumer pre-loaded it with her or her own funds.
We think it safe to say that no reasonable consumer would
pay close to $200 for the opportunity to order this
“ChexCard.” Any doubt that consumers were misled is
dispelled by the number of consumer complaints. BABC
Customer Service records reveal that in the two-month
window from June to August 2002, over 200 consumers
called to complain that they thought they would be getting
a credit card. Accordingly, the corporate defendants violated
section 5 of the FTC Act. See FTC v. World Media Brokers,
No. 04-2721, slip op. at 7 (7th Cir. July 27, 2005).
  The evidence also establishes multiple violations of the
TSR, 16 C.F.R. § 310.1-10.9, the FTC’s Trade Regulation
promulgated to implement the Telemarketing and Con-
sumer Fraud and Abuse Prevention Act, 15 U.S.C. § 6101-
6108. The FTC alleged that the defendants violated three
provisions of the TSR, which we consider in turn.
  Section 310.3(a)(1)(i) requires telemarketers to clearly
and conspicuously disclose “[t]he total costs to purchase,
receive, or use . . . any goods and services” offered for sale.
16 C.F.R. § 310.3(a)(1)(i). Although telemarketers assured
consumers that the “MasterCard” had a “one time” fee of
$174.95 plus shipping and handling, that was not the case.
No. 04-2173                                                13

After a consumer’s checking account was debited anywhere
from $199 up to $399, he or she received the BABC “mem-
bership” materials in the mail. Those materials contained
the useless “ChexCard™ MasterCard®” with an accompa-
nying form explaining that it was not a credit card. In order
to use the “stored value card” consumers then had to mail
an additional, previously undisclosed $15 in certified funds
to “SMC Bank Card Offer” (presumably Sr. Marketing
Consultants, the four-employee operation run from
Porcelli’s mother-in-law’s home). By failing to provide
advance warning of the additional $15 fee, the corporate
defendants violated § 310.3(a)(1)(i).
   Likewise, the defendants violated § 310.3(a)(2)(iii), which
prohibits telemarketers from misrepresenting any material
aspect of the performance of the goods or services offered for
sale. As our discussion regarding section 5 of the FTC Act
makes clear, the corporate defendants misled consumers
into believing that they would receive a credit card. We
need not linger on the obvious point that the lack of any
available credit on the “MasterCard” qualifies as a material
aspect of its performance subject to disclosure. Cf. World
Media, slip op. at 7-8 (defendants’ failure to disclose
illegality of sales offer violated related provision of TSR
requiring disclosure of all material restrictions on goods
or services).
  Finally, the defendants violated § 310.3(a)(4) by leading
consumers to believe that the substantial fee charged would
be used to secure a credit card on their behalf. Subsection
(a)(4) forbids telemarketers from making a false or mislead-
ing statement to induce payment for goods or services. 16
C.F.R. § 310.3(a)(4); see also World Media, slip op. at 8. In
addition to suggesting that consumers would receive a
credit card, the telemarketers falsely assured consumers
that the card would boost their credit ratings. Despite the
promise that “nothing” looked better on an “Equifax credit
report than a MasterCard,” use of the pay-as-you go
14                                               No. 04-2173

“Mastercard” was not reported to credit reporting bureaus
like Equifax. No doubt this false promise induced consum-
ers, targeted for their poor credit histories, into paying for
the supposed “MasterCard.”
  That leaves Porcelli and Harris. Upon establishing corpo-
rate liability, the FTC must demonstrate that the individ-
ual defendants either participated directly in the deceptive
acts or practices or had authority to control them. World
Media, slip op. at 8; Amy Travel, 875 F.2d at 573; see also
Freecom Communications, 401 F.3d at 1204; FTC v. Publ’g
Clearing House, Inc., 104 F.3d 1168, 1170 (9th Cir. 1997).
Additionally, the FTC is obligated to show that the individ-
ual defendants either knew or should have known about the
deceptive practices. World Media, slip op. at 8; Amy Travel,
875 F.2d at 573-74. It is not, however, required to prove
subjective intent to defraud. Amy Travel, 875 F.2d at 573-
74. Instead, the FTC may fulfill the knowledge requirement
with evidence that the individuals had “actual knowledge of
material misrepresentations, reckless indifference to the
truth or falsity of such misrepresentations, or an awareness
of a high probability of fraud along with an intentional
avoidance of the truth.” Id. at 574 (citation and internal
quotations omitted).
  We begin with Porcelli. On appeal Porcelli never directly
takes issue with the district court’s conclusion that he
should be held individually liable for the corporate mis-
representations. Instead, he makes a passing reference to
a former BABC’s employee’s affidavit to the effect that
Porcelli was in Canada from May 2002 until after BABC
was closed in August 2002. Even if we were to consider the
affidavit, it does not create a genuine issue over whether
Porcelli had the requisite authority and knowledge to be
individually liable. Porcelli is the owner and chief executive
officer of every corporate defendant except Bay Vacations,
Inc. Acting in that role he made countless decisions that
demonstrate his authority to control the corporate defen-
No. 04-2173                                                15

dants. See World Media, slip op. at 9 (service as director,
president, and secretary of multiple corporations demon-
strated defendant’s authority to control); Amy Travel, 875
F.2d at 573 (authority to control may be demonstrated by
active participation in the corporate affairs, including
assuming duties as a corporate officer). For example, he
controlled decisions such as who would perform
telemarketing for BABC and American Leisure Corp. He
also created Bay Memberships, Inc. to secure continued
payments from banks becoming suspicious of BABC. As the
mastermind behind the entire scheme, there is no question
that Porcelli had authority to control the defendant corpora-
tions. See Amy Travel, 875 F.2d at 574-75.
  Nor does Porcelli’s stay in Canada diminish the evidence
that he knew about the corporations’ deceptive practices. He
testified in his deposition that while in Canada he received
regular e-mails that kept him apprised of the corporate
affairs. Indeed, it was from Canada that Porcelli wrote the
following e-mail revealing his plan to keep forming new
corporate entities to staunch the flow of consumer com-
plaints: “[W]hen it is at the inquiry stage, where we have a
few unhappy people, but no epidemic[,] we switch to the
new company[.] . . . [T]he turndown of complaints will make
[American Leisure Corp.] disappear from the radar screen
to pursue.” Then when the newly formed company “start[s]
to build up the sales and coml\plaints [sic] . . . we keep the
complaints down and set up a successor even quicker in
another state, so that the temperature never gets high.” Not
surprisingly, Porcelli makes no attempt to explain the e-
mail, which goes far toward establishing his knowledge of
the corporations’ deceptive practices. See id. at 574-75
(knowledge shown in part by “high volume of consumer
complaints”). In addition to knowing about the number of
consumer complaints, Porcelli received a letter from the
state of Montana instructing him to cease telemarketing
there because the scripts misled consumers into believing
16                                                No. 04-2173

they would receive a credit card. This letter, as well as a
suit by the state of North Carolina (resulting in a ban on
sales to North Carolina), more than adequately alerted him
to the corporations’ deceptive trade practices. See World
Media, slip op. at 9-10.
  Harris, for her part, claims that there is a genuine issue
of material fact over whether she was “a salaried employee
or an officer with authority to control.” To support her
claim, she points to her affidavit in the district court stating
that she is not an “owner or stockholder” in any of the
corporations and makes a salary of $1250 a week.
In addition to being evidence that the district court properly
disregarded, her assertion is irrelevant. Harris cites no
authority, nor are we aware of any, to the effect that
receiving a weekly salary is somehow inconsistent with
having corporate control or knowledge of corporate affairs.
The record establishes that Harris handled the corporate
finances for American Leisure, and also transferred funds
to pay expenses for BABC, BABC Customer Service, and
Special Technologies. She also had signing authority on the
corporate accounts for BABC, BABC Customer Service,
American Leisure, Sr. Marketing Consultants, Inc., and
Bay Memberships, Inc. and was authorized to use Porcelli’s
signature stamp. Thus, Harris had ample authority to
control the corporate defendants. See Publ’g Clearing
House, 104 F.3d at 1170.
  And like Porcelli, she was aware of the near-constant
stream of complaints from customers who thought they
would receive a credit card in exchange for their payment.
She also knew that banks were refusing to debit customer
accounts for payments to BABC and American Leisure.
In October 2001, she sent the telemarketing company an e-
mail saying, “We have been deluged with check returns
from our bank this week.” To claim ignorance in the face of
the consumer complaints and returned checks amounts to,
at the least, reckless indifference to the corporations’
No. 04-2173                                             17

deceptive practices. See Amy Travel, 875 F.2d at 574-75.
  Finally, nowhere do Porcelli and Harris suggest that the
corporations’ deceptive practices did not harm consumers.
The FTC submitted declarations from multiple consumers
who purchased the defendants’ package, only to learn later
that it did not contain a credit card. These consumers
also attempted unsuccessfully to receive a refund for the
money debited from their accounts. Thus, the FTC has
established consumer injury, the final requirement for
individual liability under the FTC Act. See Freecom Com-
munications, 401 F.3d at 1205-06; Amy Travel, 875 F.2d at
573.


                           IV.
  For the foregoing reasons, we AFFIRM the district court’s
grant of summary judgment in favor of the FTC.
18                                        No. 04-2173

A true Copy:
      Teste:

                    ________________________________
                    Clerk of the United States Court of
                      Appeals for the Seventh Circuit




               USCA-02-C-0072—8-25-05
