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Augusta Bulldogs: Consumer Affairs Page II

No Bargain: Free Gizmo or Gadget? Read the Fine Print

Dec. 12 — A half dozen commercials airing around the country claim to be giving away gizmos and gadgets, “absolutely free!”

But you may find that ordering one of these free items could result in charges of more than $100 on your credit card.

GMA's Greg Hunter investigates these "free" offers.

Good Morning America’ s Consumer Correspondent Greg Hunter began hearing complaints from people who had charges appearing on their credit cards, but no idea what they were for.

A check revealed that these people all had something in common: They responded to one of a series of curious TV commercials offering free goods.

Dorene Campo was one of several people Hunter found who received freebies, then found her credit card was charged not only for the $6.95 shipping and handling charge, but also up to $96 for something they didn’t bargain for.
“Did you feel cheated?” Hunter asked Campo. “Oh yeah,” she said. “Because they stole money from me.”

But how did it happen? To find out, Hunter went back to the video tape of a television commercial.

He noticed this sentence in a commercial: “and as a special bonus for ordering today, you’ll receive a free 30-day trial membership in Americas Advantage.”

Guess What? You’re In the Club
That so-called “special bonus” is actually a requirement, Hunter found. In order to get the freebies the company running the ads says that you must enroll in a buying club, for which your credit card will automatically be charged up to $96, unless you cancel within 30 days.

The company says that this requirement is disclosed, in the fine print on the bottom of the screen. People are also told about the buying club when they order, the company says.

But Hunter found that he was not told when he called for a free item.
“Now this, these are free now right, I’m just paying $6.95?” Hunter asked when he called to order.

“You’re just paying $6.95 for shipping and handling,” the operator responded.
“OK, and they’re not going to charge any other charges now right?” Hunter asked.

“No,” the operator responded.
Hunter received the lights he ordered, but he also got a letter informing him that he had been enrolled in the Americas Advantage Buying Club, and would be charged $96 unless he canceled.


Leaving The Club Can Be Difficult

Once in the club, Hunter was warned by former members whom he interviewed that it may be hard to get out.

“I had to make a million phone calls,” said Campo, who was charged for membership.

“I called for about two weeks, trying every day two to three times a day,” said T.J. Fatum.

It was constantly busy, busy, busy, busy,” said Rich Deluca.

Hunter found International Brands Marketing, the company running the ads for all those freebies, in Coral Springs, Fla.

When he confronted Ed French of International Brands Marketing he got little response. “Well Ed, the attorney general in Florida says your commercials are deceptive,” Hunter said.

“Yeah, I can’t answer any of that, I don’t know anything about it,” French said.

International Brands Marketing eventually said that the buying clubs in their commercials are run by a totally separate company named Triad Discount Buying Service.

The Florida Attorney General’s office says that other company, Triad, has enrolled more than 3 million members through these commercials and other methods.

But how many had no idea they were joining? The Better Business Bureau in West Palm Beach has more than 1,500 buying club complaints from around the country, said Kim Overman, of the BBB in Southeast Florida.

“None of them ever recall ever giving authorization for their credit card to be charged,” Overman said.

The Trail Stops at Ira Smolev

The complaints name no fewer than 17 buying clubs, all with different names. But they all have the same owner: Ira Smolev, who lives in Boca Raton, Fla.

He didn’t return calls requesting an interview, and Good Morning America found the doors of his business locked. It turns out that GMA may be the least of Smolev’s worries.

The Florida Attorney General’s Office says half the attorneys general in the country are investigating Smolev’s companies.

He has a history of similar problems: Federal Trade Commission charges from the 1980s and ’90s of false or misleading infomercials and a 1984 criminal conviction for fradulent advertising. And yet Smolev has flourished, living in a $1 million oceanfront condo in Boca Raton, and driving around town in a Jaguar.

“Well — Mr. Smolev apparently is a very ... smart man,” said Jody Collins, Florida assistant attorney general. In fact, her office found that in one year, 1998, Smolev made $40 million through the buying clubs.

A Troubling Footnote

One complaint filed against Smolev included a plea: “Please stop this company from pulling this racket on other people!”

The state Attorney General’s Office said it’s trying. “We’re not closing this one until we’ve got either an agreement or we’ve got these practices cleared up,” Collins said.

Those who complained to the Better Business Bureau noticed the charge on their credit card statement, but Collins pointed out that others could have missed it. After a year, the up to $96 membership fee renews automatically, if it goes uncontested and unnoticed. The annual fee continues, unless and until members cancel.

The state Attorney General’s office says Triad’s records show more than 400,000 memberships renewed in the past four years. Though all of them could be satisfied customers, renewing their memberships on purpose, state officials don’t think so, and they are investigating.

And now, Smolev’s company is in bankruptcy, which the BBB says is going to make it harder for people to get refunds.

One important step for consumers to take is to carefully check their credit card statements every month, Hunter said.


Signs of Scams and Schemes

Schemes and scams can appear in many guises, but there are basic principles underlying all of them that consumers should be on the lookout for.

One of the main ones is that if an offer sounds too good to be true, it probably is. And as more shoppers turn to the Internet, especially for the holidays, they should be wary.

If you see merchandise on the Internet, don’t automatically assume that the company is legitimate. Obtain the company’s physical address and phone number and check the company out with your Better Business Bureau.

The BBB also warns consumers to be alert for these red flags:

*A promoter who is not based locally, provides no telephone number, and uses a PO box or mail drop, rather than a full street address

*A promoter name and/or logo that closely mimics that of a respected brand or business;

*Pressure words, such as “urgent” or “final deadline,” sprinkled throughout sales literature

*Pressure, threats or harassment, either in writing, during a phone call, in an e-mail message, or in a personal contact

*Immediate request or demand for a check, money order or cash to be picked up by a courier or to be sent to a mail drop or PO box

*Vague answers or none at all to key questions you ask about the offer

*Insistence that you finalize a deal orally or provide personal financial information (such as your social security number or credit card number), without a written contract or other documentation in writing

The BBB also says you should give personal information only if you know who’s collecting it, why, and how it’s being used and read documents carefully before signing.

For more information on how to protect yourself from schemes, scams and fraud contact your BBB or visit the BBB’s central Web site at Better Business Bureau

— ABCNEWS.com

ABC News - Buying Clubs Feature

Funerals: BE SMART KNOW YOUR RIGHTS

--- Funeral Links ---

Federal Trade Commission Home Page
http://www.ftc.gov/

Federal Trade Commission Consumer Protection Home Page
http://www.ftc.gov/ftc/consumer.htm

Funerals: A Consumer Guide
http://www.ftc.gov/bcp/conline/pubs/services/funeral.htm

Funerals, Caskets and Burial Vaults
http://www.ftc.gov/bcp/conline/pubs/services/caskets.htm

Funeral Rule - 16 CFR 453
http://www.ftc.gov/bcp/rulemaking/funeral/index.htm

Funeral Smart
www.funeralsmart.com

The Federal Trade Commission says Funeral Homescan no longer require you to purchase your funeral merchandise from them.

They can not decline to accept or charge an additional fee if you bring in a casket or other merchandise from an outside source.


Most states have a licensing board that regulates the funeral industry. You may contact the board in your state for information or help. If you want additional information about making funeral arrangements and the options available, you may want to contact interested business, professional and consumer groups. Some of the biggest are:

AARP Fulfillment
601 E Street, NW
Washington, DC 20049
1-800-424-3410
www.aarp.org
AARP is a nonprofit, nonpartisan organization dedicated to helping older Americans achieve lives of independence, dignity and purpose. Its publications, Funeral Goods and Services and Pre-Paying for Your Funeral, are available free by writing to the above address. This and other funeral-related information is posted on the AARP website.

Council of Better Business Bureaus, Inc.
4200 Wilson Blvd., Suite 800
Arlington, VA 22203-1838
www.bbb.org/library/funeral.asp
Better Business Bureaus are private, nonprofit organizations that promote ethical business standards and voluntary self-regulation of business practices. The BBB's website offers information about pre-need funeral planning.

Funeral Consumers Alliance
PO Box 10
Hinesburg, VT 05461
1-800-458-5563
www.funerals.org
FCA, a nonprofit, educational organization that supports increased funeral consumer protection, is affiliated with the Funeral and Memorial Society of America (FAMSA).

Cremation Association of North America
401 North Michigan Avenue
Chicago, IL 60611
(312) 321-6806
www.cremationassociation.org
CANA is an association of crematories, cemeteries and funeral homes that offer cremation.

International Cemetery and Funeral Association
1895 Preston White Drive, Suite 220
Reston, VA 20191 1-800-645-7700
www.icfa.org
ICFA is a nonprofit association of cemeteries, funeral homes, crematories and monument retailers that offers informal mediation of consumer complaints through its Cemetery Consumer Service Council. Its website provides information and advice under "Consumer Resources."

International Order of the Golden Rule
13523 Lakefront Drive
St. Louis, MO 63045
1-800-637-8030
www.ogr.org
OGR is an international association of about 1,300 independent funeral homes.

Jewish Funeral Directors of America Seaport Landing
150 Lynnway, Suite 506
Lynn, MA 01902
(781) 477-9300
www.jfda.org
JFDA is an international association of funeral homes serving the Jewish community.

National Funeral Directors Association
13625 Bishop's Drive
Brookfield, WI 53005
1-800-228-6332
www.nfda.org/resources
NFDA is the largest educational and professional association of funeral directors.

National Funeral Directors and Morticians Association
3951 Snapfinger Parkway, Suite 570
Decatur, GA 30035
1-800-434-0958
www.nfdma.com
NFDMA is a national association primarily of African-American funeral providers.

National Selected Morticians
5 Revere Drive, Suite 340
Northbrook, IL 60062-8009
1-800-323-4219
www.nsm.org
NSM is a national association of funeral firms that have agreed to comply with its Code of Good Funeral Practice. Consumers may request a variety of publications through NSM's affiliate, the Consumer Information Bureau, Inc.

Funeral Service Consumer Assistance Program
PO Box 486
Elm Grove, WI 53122-0486
1-800-662-7666
FSCAP is a nonprofit consumer service designed to help people understand funeral service and related topics and to help them resolve funeral service concerns. FSCAP service representatives and an intervener assist consumers in identifying needs, addressing complaints and resolving problems. Free brochures on funeral related topics are available.

Funeral Service Educational Foundation
13625 Bishop's Drive
Brookfield, WI 53005
1-877-402-5900
FSEF is a nonprofit foundation dedicated to advancing professionalism in funeral service and to enhancing public knowledge and understanding through education and research.

--- end Funeral Links ---

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