I wonder how would US government handle this? Is this fraud?
Technically a rope can indeed be used to dry clothes, namely by
hanging it.
We don't have to guess how the US government would handle this because this individual was charged and convicted for this conduct and similar conduct by federal prosecutors on multiple occasions and sentenced to federal prison for doing so. See, for example, here, here (the FBI considered him "the Jeffrey Dahmer of fraud" and convicted him of fraud at least four times, usually of telemarketing fraud), here, here, and here ("Comisar was convicted in Los Angeles federal court in 1983, 1990, 1994 and 1999 for various telemarketing frauds.")
The usual form of telemarketing fraud would be mail fraud (18 U.S.C. § 1341) or wire fraud (18 U.S.C. § 1344). Per those links the elements of mail fraud and wire fraud, respectively, are as follows:
"There are two elements in mail fraud: (1) having devised or intending
to devise a scheme to defraud (or to perform specified fraudulent
acts), and (2) use of the mail for the purpose of executing, or
attempting to execute, the scheme (or specified fraudulent acts)."
Schmuck v. United States, 489 U.S. 705, 721 n. 10 (1989); see also
Pereira v. United States, 347 U.S. 1, 8 (1954) ("The elements of the
offense of mail fraud under . . . § 1341 are (1) a scheme to defraud,
and (2) the mailing of a letter, etc., for the purpose of executing
the scheme."); Laura A. Eilers & Harvey B. Silikovitz, Mail and Wire
Fraud, 31 Am. Crim. L. Rev. 703, 704 (1994) (cases cited).
and
The elements of wire fraud under Section 1343 directly parallel those
of the mail fraud statute, but require the use of an interstate
telephone call or electronic communication made in furtherance of the
scheme. United States v. Briscoe, 65 F.3d 576, 583 (7th Cir. 1995)
(citing United States v. Ames Sintering Co., 927 F.2d 232, 234 (6th
Cir. 1990) (per curiam)); United States v. Frey, 42 F.3d 795, 797 (3d
Cir. 1994) (wire fraud is identical to mail fraud statute except that
it speaks of communications transmitted by wire); see also, e.g.,
United States v. Profit, 49 F.3d 404, 406 n. 1 (8th Cir.) (the four
essential elements of the crime of wire fraud are: (1) that the
defendant voluntarily and intentionally devised or participated in a
scheme to defraud another out of money; (2) that the defendant did so
with the intent to defraud; (3) that it was reasonably foreseeable
that interstate wire communications would be used; and (4) that
interstate wire communications were in fact used) (citing Manual of
Model Criminal Jury Instructions for the District Courts of the Eighth
Circuit 6.18.1341 (West 1994)), cert. denied, 115 S.Ct. 2289 (1995);
United States v. Hanson, 41 F.3d 580, 583 (10th Cir. 1994) (two
elements comprise the crime of wire fraud: (1) a scheme or artifice to
defraud; and (2) use of interstate wire communication to facilitate
that scheme); United States v. Faulkner, 17 F.3d 745, 771 (5th Cir.
1994) (essential elements of wire fraud are: (1) a scheme to defraud
and (2) the use of, or causing the use of, interstate wire
communications to execute the scheme), cert. denied, 115 S.Ct. 193
(1995); United States v. Cassiere, 4 F.3d 1006 (1st Cir. 1993) (to
prove wire fraud government must show (1) scheme to defraud by means
of false pretenses, (2) defendant's knowing and willful participation
in scheme with intent to defraud, and (3) use of interstate wire
communications in furtherance of scheme); United States v. Maxwell,
920 F.2d 1028, 1035 (D.C. Cir. 1990) ("Wire fraud requires proof of
(1) a scheme to defraud; and (2) the use of an interstate wire
communication to further the scheme.").
The definition of a fraudulent scheme for mail and wire fraud statute purposes is broader than for common law fraud:
The mail fraud and wire fraud statutes do not define the terms
"scheme" or "artifice" and the courts have traditionally been
reluctant to offer definitions of either term except in the broadest
and most general terms. Lemire, 720 F.2d at 1335 ("Congress did not
define 'scheme or artifice to defraud' when it first coined that
phrase, nor has it since. Instead that expression has taken on its
present meaning from 111 years of case law.").
The fraudulent aspect of the scheme to defraud is to be measured by
nontechnical standards and is not restricted by any common-law
definition of false pretenses. "[T]he words 'to defraud' in the mail
fraud statute have the 'common understanding' of '"wrongdoing one in
his property rights by dishonest methods or schemes," and "usually
signify the deprivation of something of value by trick, chicane, or
overreaching."'" Carpenter, 484 U.S. at 27 (quoting McNally v. United
States, 483 U.S. 350, 358 (1987) (quoting Hammerschmidt v. United
States, 265 U.S. 182, 188 (1924))). "The concept of 'fraud' includes
the act of embezzlement, which is '"the fraudulent appropriation to
one's own use of the money or goods entrusted to one's own care by
another."'" Id. (quoting Grin v. Shine, 187 U.S. 181, 189 (1902)).
No actual loss to a particular victim need be shown and the fraud can be one that only deceives gullible people per this source. See also Shaw v. United States, 196 L.Ed.2d 372, 137 S.Ct. 462 (2016) (lack of financial loss is not a defense).
The mailing or wiring can be done by a third party and need not contain actual false statements themselves per this source (indeed a fraudulent scheme is not required to involve a false representation of fact at all). See, e.g., Carpenter v. United States, 484 U.S. 19 (1987) (stock trading in advance of publication of a Wall Street Journal column to profit from a predictable effect on the stock market is actionable as fraudulent scheme under the mail and wire fraud statutes even if the columns themselves are true); SEC v Zanford, Case No. 01-147 (U.S. 2002) (false statement of fact not required for fraudulent scheme liability).
If a fact that would prevent a reasonable customer from being misled is omitted, it is still a scheme to defraud. Edwards v. United States, 312 U.S. 473 (1941). See also Worden v. California Fig Syrup Company, 187 U.S. 516 (1903) (it was misleading and fraudulent to call a product "Fig Syrup" when fig syrup was present in the product but was only a minor ingredient making up a small part of the total product).
For example, in this case, the description, by not clearly stating that it is a clothesline that is being sold, even if the statements made could be construed to be technically true, is still mail fraud because the omission is likely to mislead a reasonable customer without a complete disclosure of the fact that it is a clothesline being sold for far more than going price for a clothesline at the time.