Archive for the ‘Better Business Bureau’ Category

Local BBB Teams Up with U.S. Postal Service and U.S. Postal Inspection Service to Mark National Consumer Protection Week

Better Business Bureau is marking National Consumer Protection Week (NCPW), March 7 – March 13, by highlighting its resources that advise consumers about spending money wisely and avoiding being scammed by con artists.

BBB is a proud sponsor of NCPW, during which hundreds of national and local organizations work together to educate consumers on the importance of taking control of and protecting their personal finances. The theme of this year’s NCPW is “Dollars and Sense”, which emphasizes consumer education for every stage of life – from grade school to retirement.

BBB is teaming up with the U.S. Postal Service and the U.S. Postal Inspection Service in two separate events to bring awareness to NCPW, and bring education to a maximum number of people in two different locations. Here is more information on each of the events:

Event 1 – BBB and the U.S. Postal Service

Monday, March 8, 2010

11 am – 1 pm

Louisville Main Post Office Lobby

1420 Gardiner Lane

Louisville, KY 40231

Event 2 – BBB and the U.S. Postal Inspection Service

Thursday, March 11, 2010

11 am – 2 pm

Borders

400 South 4^th Street

Louisville, KY 40202

The organizations will distribute DVD’s and brochures warning against identity theft and fraudulent schemes, providing consumers with valuable information about protecting their finances. BBB will also hand out the first edition of its 2010 Wise Buying Guide.

“The economy is still in a slump and, now more than ever, consumers need to take control of their spending habits and be vigilant against fraud and scams,”  says Reanna Smith-Hamblin, Vice President/Communications of the BBB serving Louisville, Southern Indiana, and Western Kentucky. “We will be out at these events to help encourage consumers to take the time to get educated during National Consumer Protection Week, and remind them that they can use the BBB as a resource.”

Following are just a few ways that BBB can help consumers shop smarter and safer.  BBB is here to help if…

• You need every-day advice on how to manage your money and be a savvy consumer. BBB has created hundreds of tips columns and consumer alerts on personal finance topics such as how to build a family budget, hire a contractor or avoid the latest scams. Advice you can trust is available online at bbb.org.

• You need help finding a business you can trust. The BBB Accredited Business Locator can help you find businesses in your area that uphold BBB’s rigorous standards and have made a commitment to support the work of BBB. There are nearly 400,000 BBB accredited businesses across North America including retailers, contractors and online businesses.

• You want to research a business before you buy. BBB maintains reports on nearly 4 million businesses across North America. A business’s reliability report will tell you how many complaints the business has received, how they responded to complaints and their letter-grade rating reflecting BBB’s experience with the business.

• You have a dispute with a business. Not only is BBB here to help educate consumers before they buy, BBB can also lend a hand if you have a dispute with a business. Every year BBB receives hundreds of thousands of complaints from disgruntled consumers and is usually able to help resolve the issue quickly and easily.

• You have been ripped off by a scammer. While BBB isn’t a law enforcement agency and cannot arrest scammers or unscrupulous businesses, your complaint enables BBB to identify trends and warn other consumers and hopefully prevent others from being taken advantage of as well.

Check out all of the online resources and tools BBB provides at www.bbb.org. More information and advice is also available on the National Consumer Protection Week Web site, www.consumer.gov/ncpw.

Consumer Protection Week begins March 7th. BBB is a proud supporter of this nationwide effort to educate the public on how to become savvier consumers. Hundreds of national and local organizations will work together to educate consumers on the importance of taking control of their personal finances. Look for your BBB at various local events.

U.S. Census – Be alert for potential scams surrounding the U.S. Census which ramps up in March. Most census forms will arrive in the mail March 15 – 17 and then at the end of April, Census workers will go door-to-door to households that didn’t return the form. Beware of anyone who asks for your social security number or bank account information. Also, the Census will not contact you by email.

IRS Scam – Beware of an email that looks like it’s from the IRS. The “very important note” states the consumer is eligible for a tax refund, and asks the consumer to go to a website that looks like the official IRS website. The fake website asks for the consumer to use a small bank debit account, like a hometown bank, instead of a large bank like PNC, Chase, etc. The IRS will never contact someone via email about taxes.

Chile Earthquake Scams – Be alert for scams surrounding the Chile earthquake. BBB recommends to avoid making donations to unfamiliar websites or as a result of a solicitation received via email. Also be aware that scams can occur on social networking sites like Twitter, Facebook, and MySpace. For more information on donations, check out the BBB’s Wise Giving Alliance at www.give.org.

Online Job Scams – Job seekers who respond to certain job postings on Craigslist are receiving an email requesting information for either a background check or credit report prior to consideration for employment. The scammer directs the job seekers to a website that is used to steal their personal information. Legit job offers never require upfront fees or bank account information before an interview.

Online Housing Schemes – Consumers looking for homes to rent on Craigslist should be skeptical of ads that seem “too good to be true.” Consumers across the country are being duped by scam artists who say they are living in Nigeria and want to rent their home in the U.S. The scam artist offers a cheap price for the rental, but wants an advanced payment wired to them. The listings are legitimate homes, many of them on the market for sale. However, the real owner knows nothing of this elaborate scam.

The Love Foundation claims to be a program that offers financial assistance for children of the homeless and unemployed. The ad is popping up on Craigslist and other sites. The “foundation” claims to be out of different states. Those who need assistance are asked to call 1-800-217-9750. The first thing the caller is asked to provide is a social security number.

National Publishers, Inc. is a Mississippi-based magazine subscription company that’s claiming membership with the BBB. The company, which also does business as Exclusive Media, has an “F” rating with the BBB due to failure to correct a pattern of complaints. Consumers say they received a call from the company informing them that they won a sweepstakes for cash prizes, items, or trips, but they are told they must purchase magazine subscriptions in order to win. Consumers report that they are then charged several payments each month, sometimes totaling hundreds of dollars.

Spring Break Scams – Be cautious when surfing the Internet to find great deals on spring break travel. While the rates may look good, you may click on an offer and find that the total price is much more than the advertised price. BBB recommends spring breakers review all terms and conditions as well as cancellation and refund policies before finalizing deals, and check out the company first at www.bbb.org.

Online Payday Lenders – BBB has received hundreds of complaints against payday loan sites like OnceClickCash.com, 500Fastcash.com, rbtloans.com, and Ameriloan.com. Complainants say they agreed to what they thought was a one-time payday loan, typically a few hundred dollars to be paid off in two weeks, and quickly found out that payments went towards recurring finance charges and never toward the principal. They report paying two to three times the amount of the original loan.

BBB Lottery Scam – Scam artists are posing as the BBB in order to steal tens of thousands of dollars from victims who are led to believe they have won a lottery. Consumers are contacted on the phone or by e-mail by someone claiming to be an employee of the BBB. They were told that they won a lottery and that they must wire money to get their prize. In some cases, the scammers used the names of real BBB employees, directing victims to legitimate bios and profiles on BBB’s Website. BBB does NOT run a lottery nor award prizes to consumers. If you receive a call or e-mail like this, contact your BBB.

Grandparent Scam – A local couple was scammed out of over $4,000 after they received a call from what they thought was a cop who said their granddaughter was in jail in Canada. The “cop” told the couple that the granddaughter needed money for bond and a lawyer, and asked them to wire the money. The “cop” even let them talk to their “granddaughter,” who told them not to tell anybody about what happened. Seniors across the country have lost thousands of dollars to this scam.

Cragslist Job Scam - Not all job postings are what they seem to be on Craigslist. BBB’s across the country are receiving inquiries on questionable job offers through the site. Some signs that the posting could be a scam: They fail to list a specific location for the job, they list a salary that seems too good to be true, They post a government job or “work from home” opportunity, misspellings, no job contact information, and asking for your personal information.

Credit Card Act – Circle February 22nd on your calendar. That’s the day new protections will kick in for cardholders across the U.S. BBB recommends all cardholders familiarize themselves with the new provisions. Some of the new regulations include: more notice for new interest rate changes, older age restrictions, new rules for monthly statements, over the limit opt-in, and more. For a breakdown of the Credit Card Act of 2009 go to creditcards.com.

IRS Scams – At this time of the year, scam artists take advantage of taxpayers. Whether it’s a phone call, an e-mail, or a text message, be wary if it claims to be from the IRS. The message may ask for you to provide personal information. This is a phishing attempt to steal your identity. The IRS will only contact you via the United States Postal Service.

Refund Anticipation Loans – BBB warns to use caution when dealing with refund anticipation loans, which are offered by some tax preparers. These loans give taxpayers an amount equal to their tax refund within 24 hours, but the fees and high interest rates associated with the loan could cost taxpayers in the end. BBB suggests that if it is absolutely necessary to have a refund immediately, shop around. RAL fees vary by tax preparer.

UBI Payment Services promises thousands of dollars in exchange for answering a simple math question and providing a signature. Consumers across the country are receiving letters that state a “guarantee to receive $5,000″ if they sign a document and solve a puzzle. The company has an “F” rating with the BBB. UBI Payment Services does business under at least 35 different names. Go to www.bbb.org for a list.

Text Messaging Scams – Scam artists are using text messaging more and more to steal your personal information. The text message purport to be from banks, credit unions, credit card companies, the IRS, and more. The urgent message warns the recipient that his or her account or identity has been compromised. A toll free number is provided for a response, and when it is called the consumer is asked to verify a credit card number or other form of identification. Delete these text messages!

‘809’ Area Code Scams – Be suspicious of e-mails, texts, or messages referring you to call a phone number with an 809 area code. The message often sounds like an emergency, and you are told to call the 809 number right away. When you call, you reach a pay-per-call number in the British Virgin Islands, and are billed $25 or more for dialing the number.

Looking for Love? Consumers spend hundreds of millions of dollars on dating services each year. Whether it’s a matchmaking service or online dating, BBB receives a large number of complaints on the industry. If you plan to use these services, be sure to check out the company with the BBB first, don’t fall for exaggerated advertising claims, and before you sign a contract be sure to read it carefully. Go to www.bbb.org for more information.

It’s time to start working on your taxes! If you plan to hire someone to do your taxes this year, BBB recommends you choose a preparer wisely. Tax payers are ultimately responsible for everything on their return, even if it is prepared by someone else.  Reputable tax preparers will ask tax payers several questions to determine whether expenses, deductions and other items qualify and remind clients that they need to keep careful and complete records in order to substantiate information on their tax return.

The BBB offers these tips when choosing a tax preparer:

• Check to see if the preparer has any questionable history with the Better Business Bureau, the state’s board of accountancy for Certified Public Accountants or the state’s bar association for attorneys. Find out if the preparer belongs to a professional organization that requires its members to pursue continuing education and also holds them accountable to a code of ethics.

• Ask family and friends for recommendations.

• Find out what the service fees are before the return is prepared. Avoid preparers who base their fee on a percentage of the amount of your refund or who claim they can obtain larger refunds than other preparers.

• Only use a tax professional that signs your tax return and provides you with a copy for your records.

• Avoid tax preparers that ask you to sign a blank tax form.

• Determine if the preparer’s credentials meet your needs. Does your state have licensing or registration requirements for paid preparers? Is he or she an enrolled agent, CPA or attorney? If so, the preparer can represent taxpayers before the IRS on all matters, including audits, collections, and appeals. Other return preparers can represent taxpayers only in audits regarding a return signed as a preparer.

• Before you sign your tax return, review it and ask questions.

You’ll also want to avoid any tax scams. Remember, the IRS will not contact you by phone or email and ask for your personal information. They will contact you by mail, only. Go to www.irs.gov for more information on tax related scams. You can contact the Better Business Bureau at www.bbb.org or call 1-800-388-2222.

The Wal-Mart gift card scam has apparently made its way to Kentucky. A local consumer contacted the BBB to inquire about a text message she received, advising her that she won a $200 Wal-Mart gift card. When she called the number in the text message (877-232-5149) she was told that in

Kentucky the gift card was for $180 and that she would need to pay $7.60 for shipping/handling fees. She was then asked to provide her credit or debit card number. Luckily, the inquirer was skeptical. She hung up the phone and decided to call the BBB before giving out any personal information.

Wal-Mart does award gift cards if you take part in a customer service survey found on your receipt. But a Wal-Mart spokesperson says the company tells consumers they’ve won through certified mail and a phone call. Wal-Mart will never ask for your personal or banking information.

These text messaging scams are getting more and more popular. It’s called “shmishing,” scams by short message services (SMS), or text. BBB advises consumers to be wary of random message sent to your phone, especially anything to do with finances. BBB suggests if you receive a message like this, do not reply to it, don’t call the number in the text, and don’t click on any hyperlinks. DELETE the message!  Also, report the message to the FCC, the FTC, and the BBB.  If you are still concerned over the text message, contact the company direct. Don’t rely on the text message. And, if you have to pay for text messaging, contact your provider as soon as possible to dispute the charge.

For more information on consumer tips and scams, go to www.bbb.org or call 1-800-388-2222.

In the wake of the earthquake disaster in Haiti, Americans are donating via text message more than ever before. The Better Business Bureau Wise Giving Alliance advises donors that giving through text can be a safe and easy way to give—but you should still use caution.

Within days following the disaster in Haiti, it was widely reported that more than $3 million was donated through text message to such organizations as the Red Cross and others.

While it is a convenient way to donate, donors should still do their due diligence to make sure their money is going to trustworthy charities, not to scam artists. BBB Wise Giving Alliance offers the following tips on giving through text messages:

• Confirm the number directly with the source. This is an emerging method for donating. It is ripe for exploitation by scammers.
• Be aware that text donations are not immediate. Depending on the text message service used by the charity, text donations can take anywhere from 30-90 days to be transferred to the designated charity. If you would like the donation to be received immediately by the charity, you can give online through the charity Web site, by calling the charity directly or by sending a check in the mail.
• Review the fine print. When you give to a charity through text message, you might also be signing yourself up to receive text message updates from the charity in the future. A charity should include the details of its text campaign on its Web site so you can see what you’re signing up for and how you can opt out.
• Research the charity. Giving wisely to a charity isn’t just about making sure that the solicitation isn’t coming from scammers. Wise donors make sure their donations are going to charities that are best equipped to help in the relief efforts and will responsibly use the money for its intended purpose.

BBB Wise Giving Alliance has compiled a list of charities which are seeking to provide assistance in response to the earthquake in Haiti and meet BBB Standards for Accountability at http://www.bbb.org/us/haiti-earthquake-relief/.

As immediate relief needs are assessed in the wake of the devastating earthquake in Haiti, many Americans are looking for ways to help by donating to a charity. The BBB Wise Giving Alliance warns that, as occurred following the tsunami in 2004 and Katrina in 2005, fraudulent charities will likely emerge to try and scam donations from well-meaning Americans.

“Whenever a major disaster occurs, in the U.S. or abroad, scam artists come out of the woodwork,” says Reanna Smith-Hamblin, Vice President/Communications of the BBB. “Consumers need to be sure their money is going to legitimate relief organizations.”

BBB Wise Giving Alliance offers the following tips to help Consumers decide where to direct donations:

Rely on expert opinion when it comes to evaluating a charity. Be cautious when relying on third-party recommendations such as bloggers or other Web sites, as they might not have fully researched the listed relief organizations. The public can go to www.bbb.org/charity to research charities and relief organizations to verify that they are accredited by the BBB and meet the 20 Standards for Charity Accountability.

Be wary of claims that 100 percent of donations will assist relief victims. Despite what an organization might claim, charities have fund raising and administrative costs. Even a credit card donation will involve, at a minimum, a processing fee. If a charity claims 100 percent of collected funds will be assisting earthquake victims, the truth is that the organization is still probably incurring fund raising and administrative expenses.  They may use some of their other funds to pay this, but the expenses will still be incurred.

Be cautious when giving online.

Be cautious about online giving, especially in response to spam messages and emails that claim to link to a relief organization. In response to the tsunami disaster in 2004, there were concerns raised about many Web sites and new organizations that were created overnight allegedly to help victims.

Find out if the charity has an on-the-ground presence in the impacted areas.

Unless the charity already has staff in the affected areas, it may be difficult to get new aid workers to quickly provide assistance.  See if the charity’s website clearly describes what they can do to address immediate needs.

Find out if the charity is providing direct aid or raising money for other groups.

Some charities may be raising money to pass along to relief organizations.  If so, you may want to consider “avoiding the middleman” and giving directly to charities that have a presence in the region. Or, at a minimum, check out the ultimate recipients of these donations to ensure the organizations are equipped to effectively provide aid.

Gifts of clothing, food or other in-kind donations.

In-kind drives for food and clothing—while well intentioned— may not necessarily be the quickest way to help those in need – unless the organization has the staff and infrastructure to be able to properly distribute such aid. Ask the charity about their transportation and distribution plans. Be wary of those who are not experienced in disaster relief assistance.

For more information on charities, go to www.bbb.org or call 1-800-388-2222.

Walmart Voucher Scam – The text message says you’ve won a $200 Walmart voucher and tells you to call an 877 number to claim your prize. When you call, the person says to get the voucher, they need your credit card information to pay for a $9.90 shipping fee. This is a scam! Walmart does award gift cards if you take part in a customer service survey found on your receipt, but consumers find out they have won through certified mail and a phone call. Walmart will never ask for personal or banking information.

‘Twilight’ Casting Call Scam – Scammers who are claiming to be casting “The Twilight Saga: Breaking Dawn” are targeting young fans through e-mails and fake casting call advertisements on fan sites. The e-mails implore those who are interested in walk-on parts to apply immediately with impending deadlines, promising that no experience is necessary and pay ranges from $80-250, depending on the role. If “Breaking Dawn” does start hiring extras, it will be widely advertised in the media. Also, there will be no need to pay to register at a Web site in order to find out casting details.

It’s TAX TIME! Choose a tax preparer wisely! BBB suggests before you hire a tax professional, you find out what the service fees are before the return is prepared. Avoid preparers who base their fee on a percentage of the amount of your refund. Only use a tax preparer that signs your tax return and provides you with a copy of your records. Avoid anyone who asks you to sign a blank tax form. Remember, you are ultimately responsible for everything on your tax return. For more information go to www.bbb.org.

Peel, Inc. is an Internet company that sells a variety of home products under multiple names and Website addresses. The company has an F rating with the BBB due to over 2,200 complaints from across the country. Consumers allege undisclosed or unauthorized charges, lack of clearly disclosed shipping and/or membership fees, and deceptive advertising. According to its Website, Peel Inc. is currently not accepting new orders.

BBB Lottery Scam – Local residents are getting calls from scam artists who say they represent the Better Business Bureau and they have won a million dollars. Consumers say the phone number comes up as RESTRICTED on the caller ID. BBB is not giving away a million dollars!

Joining a gym? Verify membership terms before you make a commitment. Most common complaints to BBB on athletic clubs focus on contract disputes and billing issues. BBB recommends you learn how long the membership is, if there is automatic renewal, can you go month-to-month, what is included in the monthly fee, is there a sign-up fee, and what are your cancellation rights? Also, compare clubs and prices.  Always check with the BBB for a reliability report at www.bbb.org.

Microsoft/AOL Giveaway Scam – The claim: Internet users can receive a cash reward for forwarding messages to test a Microsoft/AOL e-mail tracking system. The truth: This is a long-running Internet hoax that has been circulating since 1997. The e-mail has changed companies and rewards over the years, but the con remains the same: fool Internet users to forwarding junk messages to friends. The pranksters get the last laugh.

Employment Scams – BBB urges job seekers to be cautious with online classified ads offering jobs. BBB often gets calls from job seekers who have been offered bogus employment opportunities online. The scammers try to obtain financial and personal information. While there are legitimate jobs posted on the sites, some of the scammers post these fake jobs on sites like Craigslist, Yahoo, Monster, and Career Builder.

Out of Work? Census jobs are available! Job hunters can apply for jobs now. Most hiring will take place in spring of 2010. Census workers usually work in their own communities, going door-to-door, conducting brief interviews. Census takers work about 20 to 40 hours per week, primarily in the evenings and on weekends. Job hunters can go to www.2010censusjobs.gov or call 1-866-861-2010 for more information.

Census Facts – U.S. Census workers will be going door-to-door from April to July 2010. To be sure you aren’t scammed, BBB offers these tips: A Census worker must present an ID that contains a Dept. of Commerce watermark and expiration date. The worker will provide you with a supervisor contact upon request and provide you with a letter from the Census Bureau. A Census worker will never ask for your social security number, bank account, or credit card numbers. Census workers also never solicit for donations and will never contact you via e-mail. For more information go to www.census.gov/2010census.

Better Business Bureau is releasing its list of the top 10 scams and rip-offs of 2009. Many scams sought to take advantage of people who were suffering under tough economic circumstances – like the unemployed. Additionally, the use of free-trial offers to lock consumers into recurring credit and debit card charges was widespread online.

“While some scams on the list were perennial problems,” says Reanna Smith-Hamblin, Vice President, Communications, of the BBB, “others were distinct in 2009 due to the economic climate and scammers taking advantage of the top headlines in news.” For example, in places hit by the housing crisis, bogus offers for foreclosure rescue were overwhelming. Following, is BBB’s list of top scams and rip-offs for 2009.

They are in no particular order.

1. Stimulus/Government Grant Scams – Even before President Obama announced the stimulus plan in February, scammers had already set up schemes for misleading consumers and small business owners into thinking they could get a piece of the pie. Offers for worthless assistance and advice on how to get government grants bombarded consumers online, over the phone, and via mail and e-mail.

2. Over-Payment Scams – Over-payment scams can target small business owners, , landlords individuals with rooms to rent, and sellers on classifieds or sites like Craigslist. Typically the scammer pretends to be a customer, possible renter, or interested buyer. The victim receives a check for more than the amount requested. The scammers then ask the victim to deposit the check and wire the extra amount elsewhere, such as to a shipping company. Ultimately though, the check is fake and the victim is really wiring money back to the scammers.

3. Lottery/Sweepstakes Scam – The victim receives a letter in the mail pretending to be from Reader’s Digest, Publisher’s Clearing House, or a phony foreign lottery claiming that he or she has won millions. The letter comes with a check that represents only a portion of the total winnings. In order to get the rest, the victim has to deposit the check and then wire hundreds of dollars back to the scammers supposedly to cover taxes or some other bogus fee. The victim wires the money, but the prize never arrives.

4. Job Hunter Scams – Scams targeting job hunters vary and include attempts to gain access to personal information such as bank account or social security numbers and requirements to pay a fee in order to even be considered for the job. Many of these scam artists find the job hunters on online job posting sites like monster or yahoo jobs.

5. Google Work from Home Scam – Countless Web sites cropped up in 2009 that claimed you could learn how to make money from home using Google or Twitter and offered a free trial of learning materials. The Web sites often included the Google or Twitter moniker and logo. As a result, many people who complained to BBB thought they were getting a job with Google or Twitter when in, fact, they were being lured into another misleading free-trial offer and were billed every month for the materials and other mystery charges that added up to hundreds of dollars.

6. Mortgage Foreclosure Rescue/Debt Assistance – Many families are struggling in the current economy and hucksters are offering to help them save their house from foreclosure or help them get out of credit card debt. Unfortunately, victims are paying hundreds of dollars up front for the assistance they desperately need but ultimately never receive.

7. Mystery Shopping – Consumers across the country thought that they could make some extra money by becoming a secret shopper and evaluating the customer service of various stores. The victim is asked to evaluate their shopping experience at a few stores as well as a money wiring service such as Western Union or MoneyGram by wiring money back to the scammers. A seemingly real looking check is supposed to cover the costs, but ends up being a fake. The victim is out hundreds, if not thousands, of dollars.

8. Robocalls – Owning a cell phone or having their phone number on the do-not-call list did not help thousands of people across the US put a stop to harassing automated telemarketing calls in 2009. The robocalls often claimed that their auto warranty was about to expire—which wasn’t true, or offered help in reducing their interest rate on their credit card. The prevalence of robocalls violating federal telemarketing laws prompted the FTC to increase restrictions on the practice in 2009.

9. Phishing e-mails/H1N1 spam – A perennial problem, phishing e-mails pop up in inboxes and can take various forms such as appearing to be from a business, a government agency, or official, or even a friend. Whatever the setup, the goal of any phishing e-mail is the same: to trick victims into divulging sensitive financial information or to infect the victim’s computer with viruses and malware. In addition to phishing e-mails, spam e-mail selling wares to prevent the spread of the H1N1 virus were particularly rampant in 2009.

10. Acai Supplements and Other “Free” Trial Offers – Ads offering trial offers for teeth whiteners, acai anti-aging pills, and other miracle supplements are all over the internet, including trusted Web sites of national news organizations. The marketing campaigns often falsely claimed an endorsement by Oprah, Rachel Ray and Doctor Oz. Thousands of consumers complained to BBB that the free trial actually cost them as much as hundreds of dollars, month after month.

Consumers or small business owners victimized by a scam can contact their local BBB or file a complaint at www.bbb.org or call 1-800-388-2222. Always research a business with BBB before you sign any contracts or hand over any money.

Visa, FTC and BBB Partner to Educate Consumers about Online Scams

Twenty-nine percent of online U.S. consumers victimized by deceptive marketing

Visa Inc. (NYSE: V) joined the Federal Trade Commission and the Better Business Bureau in a press conference to alert consumers to online deceptive marketing practices associated with free trials with a negative option feature. According to a Visa survey, 29 percent of American consumers have fallen victim to deceptive marketing when unscrupulous e-commerce merchants require them to cancel or opt-out of a recurring charge for future products or services.

With free trials with a negative option feature,  a company takes a consumer’s failure to cancel as permission to begin charging. While many merchants use this billing process appropriately, others pre-check consent boxes, bury the details of the offers in the terms and conditions and make cancellations or returns difficult, catching consumers in a cycle of recurring charges for products and services they do not want.

“Most e-commerce merchants care about their customers and conduct business fairly, but even a few bad actors can cause consumer distrust,” said William M. Sheedy, Group President, The Americas, Visa Inc. “We want to let consumers know more about the protections they have against these types of practices and how to pursue a reversal of charges if they’ve been charged improperly.”

Visa monitors its payment network to identify merchants with excessive levels of cardholder disputes which may indicate the use of deceptive marketing practices. In fact, merchants who use deceptive marketing practices have up to 20 times as many consumer disputes as the average e-commerce merchant. Visa requires the merchant and its bank to take corrective action to reduce excessive consumer disputes, or risk termination of Visa acceptance privileges.

According the Better Business Bureau, consumers should research the business before they buy. “BBB has received thousands of complaints on free trial offers,” says Charlie Mattingly, President of the BBB serving Louisville, Southern Indiana, and Western Kentucky. “Everything from acai berry supplements, teeth whiteners, free government grants, and more. Before handing over your credit card number, check the company’s reliability report with the BBB.”

Visa, the FTC and BBB offers tips to online shoppers on how to spot deceptive free trial offers and deceptive negative option features, and how to deal with unauthorized charges:

• Take time to read and understand all terms and conditions, so a free trial doesn’t turn into a costly purchase you didn’t intend to make.
• Pay particular attention to any pre-checked boxes before you submit your payment card information for an order. Failing to un-check the boxes may bind you to terms and conditions you’re not interested in.
• Review card statements when you get them for any unauthorized charges, and notify the card issuer promptly of any unusual activity or unauthorized charges.
• Try to resolve the situation with the merchant. If you’re unsuccessful, contact the card issuer immediately to dispute the charge.

David Vladeck, Director of the Bureau of Consumer Protection said, “Online shoppers: If you see charges on your statement or debits that you didn’t authorize, fight it. Start by contacting the merchant. If you are unable to contact the merchant or they can’t or won’t help, call your card issuer and then file a complaint with the FTC. You can do that online at ftc.gov or by phone at 1-877-FTC-HELP.”

The FTC has outlined five principles regarding the appropriate use of negative options, which call for:

• Disclosing material terms in an understandable manner, without making them unnecessarily long or inconsistent;
• Making the disclosures clear and conspicuous by placing them where consumers are likely to look on Web pages, by labeling disclosures (and links to them) to indicate their importance and relevance, and by using easy-to-read fonts and colors;
• Disclosing the offer’s material terms before the consumer incurs a financial obligation;
• Getting consumers’ affirmative consent to the offer by, for example, having them click “I Agree” And without relying on pre-checked boxes;
• Not impeding the effective operation of promised cancellation procedures and honoring cancellation requests that comply with such procedures.

Consumers who think they’ve been victims of deceptive marketing and who haven’t been able to resolve the issue directly with the merchant should call their card issuer to dispute the charge. They also may report their experiences to the FTC at www.ftc.gov/complaint or their local BBB at www.bbb.org. More information is available at www.visa.com/negativeoption.