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6 THE GEORGIA POST
THURSDAY DECEMBER 27, 2018
Study Shows How Free Trial Offers Mislead
Consumers with Fake Endorsements,
Surprise Charges
The internet is rife with ads
and links leading to pictures
of celebrities and “miracle”
products that promise easy
weight loss, whiter teeth
or disappearing wrinkles.
You may be enticed to try
these products through a
“risk-free” trial: Just enter
your name, address and
credit card number, and the
product will be on its way
for only a nominal shipping
and handling charge. An
in-depth investigative
study by Better Business
Bureau (BBB), however,
finds that many of these
free trial offers are not free.
BBB receives complaints
from free trial offer victims
nearly every day and warns
consumers to use extreme
caution before agreeing to
the offer and entering their
credit card number.
The investigative study -
“Subscription Traps and
Deceptive Free Trials Scam
Millions with Misleading
Ads and Fake Celebrity
Endorsements” — looks at
how free trial offers ensnare
consumers in so-called
“subscription traps” that
hook them for expensive
shipments of products they
did not explicitly agree to
buy. It digs into the scope of
the problem, who is behind
it, and the need for law
enforcement and consumer
education to address the
issue. Read the complete
report at http://us.bbb.org/
freetrial.
Many free trial offers come
with fine print, buried on
the order page or by a link,
that gives consumers only
a short period of time to
receive, evaluate and return
the product to avoid being
charged, oftentimes $too or
more. In addition, the same
hidden information may
state that by accepting the
offer, you’ve signed up for
monthly shipments of the
products and such fees will
be charged to your credit
card. Many people find it
difficult to contact the seller
to stop recurring charges,
halt shipments and get
refunds. Such obscure terms
in these offers often violate
Federal Trade Commission
(FTC) and BBB guidelines
on advertising, as do the
satisfaction guarantees that
are ubiquitous in free trial
offers.
The study found that
many of the celebrity
endorsements in these
ads are fake. Dozens of
celebrity names are used by
these frauds without their
knowledge or permission,
ranging from Oprah Winfrey
and Ellen DeGeneres to
Mike Rowe, Tim Allen and
Sally Field. Sometimes the
fine print even admits these
endorsements are not real.
Free trial offers can be a
legitimate way for credible
companies to introduce new
products, provided that the
company is transparent
about the offer and its
terms. However, fraudsters
have turned such offers into
a global multi-billion-dollar
industry, one that grows
every year. Available FTC
data shows that complaints
about “free trials” more than
doubled from 2015 to 2017,
and BBB has received nearly
37,000 complaints and
Scam Tracker reports over
the last three years, though
not all of these complaints
involve monetary loss.
In addition, victims in
14 resolved FTC cases
collectively lost $1.3 billion,
and consumers making
reports to BBB lost an
average of $186.
An examination of BBB
complaints and reports
found that victims span
all income and education
levels, while a review of
complaints to the Internet
Crime Complaint Center
(IC3) from 2015 to 2017
shows a fairly-even spread
of age ranges. However,
BBB reports show that 72
percent of victims were
female, likely because many
free trial offers involve
skin care products geared
toward women. One woman
followed a social media
ad for a skin cream that
purported to have been
endorsed by the TV show
Shark Tank. She signed up
for free trial offers of that
product and another product
advertised on the same
website. While she agreed
to total charges of about $7
for shipping and handling of
the two products, in reality
she was charged nearly
$75. The website did not
advertise an end date for the
trial period or disclose that
it would continue to ship
products; such information
was ultimately hidden in
the terms and conditions
of the offer. In the end,
she was unable to obtain a
refund from the company
and could not reverse the
charges with her credit card
company because she had
accepted the terms and
conditions at checkout. She
said, adding insult to injury,
she ultimately disliked the
product and threw it away.
FTC data on free trial offers
strongly suggests that
most enterprises operate
in the U.S. and Canada,
though the companies do
sell extensively outside
the U.S. and frequently
employ overseas credit card
processing. A 2017 study by
the Canadian Anti-Fraud
Centre (CAFC) found that
the credit card transactions
at the center of the scam
were processed through
banks in 14 countries.
The report recommends:
• BBB urges credit
card companies to do
more to ensure victims
receive chargebacks where
key conditions are not
adequately disclosed.
Because this fraud is
dependent on the use of
credit cards, more effort
is needed to identify and
combat deceptive free trial
offers employing credit
card systems. Also, it would
helpful if they could do more
to educate their customers.
• Additional criminal
prosecutions of this conduct
are needed. The FTC and
BBB have done much to
address the issue, but do
not have the ability to bring
criminal charges. Only
criminal prosecutions are
likely to deter this type of
fraud.
• Social media sites
should do more to curtail
such deceptive advertising.
• International cooperation
is needed to combat this
fraud. U.S. and Canadian
law authorities need more
information about victims
from other countries. In
addition, evidence and
other key information may
be located in a variety of
countries around the world.
• More consumer
education is needed from
news media and consumer
groups like BBB.
What to do if you believe
you have been a victim of a
free trial offer fraud:
• Complain to the company
directly.
• If that is not successful,
call the customer service
number on the back of your
credit card to complain to
the bank.
• Complain to www.bbb.
org
• Report the fraud to www.
bbb.org/scamtracker
• Report it to Federal
Trade Commission (FTC) or
call 877-FTC-Help
• Report it to Internet
Crime Complaint Center, or
IC3
• Report suspicious,
confusing or misleading ads
to BBB Ad Truth.
KELVIN COLLINS is President/CEO of the Better Business Bureau serving
the Fall Line Corridor, serving 77 counties in East Alabama, West Georgia,
Southwest Georgia, Central Georgia, East Georgia and Western South
Carolina. This tips column is provided through the local BBB and the Council
of Better Business Bureaus. The Better Business Bureau sets standards for
ethical business behavior, monitors compliance and helps consumers identify
trustworthy businesses. Questions or complaints about a specific company or
charity should be referred directly to the BBB at Phone: 1-800-763-4222, Web
site: www.bbb.org or E-mail: info@centralgeorgia.bbb.org
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