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Credit Card Applications » News » Other » Three Marketing Companies Behind a Recent Online Scam According to US Senators

Three Marketing Companies Behind a Recent Online Scam According to US Senators

March 24, 2010 | Updated on March 24, 2010
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The content is accurate at the time of publication and is subject to change.

There is a current marketing scam that is being advertised in reputable Web sites, wherein consumers unwittingly get into fee-based subscription programs. The scam ads appear when people make purchases online. After an individual provides his credit card information, a pop-up message will appear enticing him to a $10 rebate for succeeding purchases by just clicking on a confirmation button. Since these offers are marketed in reputable online stores, customers rarely doubt the legitimacy of the discount promos and readily submit themselves to the program. However, when they click on the accept button they would also be enrolled to third party companies that charge customers monthly fees. However, customers are not aware of this because clever marketing companies hide information in fine print. They would find out later that they have been had upon receiving their bills and seeing subscription fees from companies they have no knowledge of.

This clever scheme has already lured millions of Americans which prompted the US Senate to conduct investigations. Legislators discovered that there are three marketing companies involved in this scam, namely, Affinion, Vertrue and Webloyalty. To date, these companies have grossed $1.4 billion from this deceptive venture.

The three companies, however, were adamant, saying that they never violated any law. To some degree their claim is true since currently there are no good laws in existence that protect consumers from dubious online marketing programs.

What's alarming with this scheme is that it is cleverly packaged and marketed that even seasoned and literate online shoppers are not spared. One IT expert by the name of, Linda Lindquist, who was invited to the Senate hearings, confessed that she had been victimized by this scam. She narrated that it was the first time in her life to have been scammed online, because she's very knowledgeable and savvy about Internet marketing tricks. She said that she never thought much about it at first since she saw the ad in a credible web store that she patronizes. Later on, she received payment demands amounting to $300 from various discount coupon companies. This prompted her to file a complaint to concerned agencies which quickly rectified the situation.

Lawmakers are also accusing online retailers of being irresponsible by endorsing tricky campaigns of the three companies. Some Web stores as of late have severed ties with the marketing companies in response to the flood of complaints and protests that they have been receiving from customers. Affinion, one of the marketing companies invited by the US Senate for questioning, appeared remorseful and promised to be more transparent in dealing with customers.

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All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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