KCD Settles Diet Ad Case for $150,000

KCD Holdings Inc. said it agreed to pay $150,000 to settle federal allegations that the company made unsubstantiated advertising claims for a weight-loss supplement. The Westlake Village-based company said a settlement with the Federal Trade Commission will also require it to have adequate scientific substantiation for its future advertising. The company’s board last month approved a proposed settlement. The agreement must still be approved by the FTC. Bonnie Richards, KCD vice president, said the investigation started more than two years ago, when the FTC questioned advertising claims that KCD’s SeQuester1 weight-loss supplement could help people lose weight by keeping the body from absorbing fat. Richards said future ads for SeQuester1 will say the product can help people lose weight when used in a weight-loss plan that includes exercise and a good diet. KCD shares fell 16 cents to close at $1.44 in over-the-counter trading.