Sam Hamer, Public Policy Intern Summer is finally here! Unfortunately, along with cicadas and lazy afternoons by the barbecue, door-to-door magazine sales scams are likely to appear in many consumers’ neighborhoods. These scams typically begin with a knock at the door and a young person on the other side claiming to be raising money for a charity, school trip, or other seemingly worthy cause by selling magazine subscriptions. In fact, consumers who take the bait and sign up for a subscription often report that they receive nothing in return.
Every year, young people fan out across the country, looking to make easy money from unsuspecting consumers. In Medford, Ore. last month, two young adults were arrested after they were discovered depositing into the bank over $4,500 collected from fraudulent door-to-door book and magazine subscription sales.
This couple acted as isolated perpetrators, yet several companies that annually employ young salespeople to peddle suspect magazine subscriptions have drawn hundreds of complaints about their sales tactics and product, earning them a rating of ‘F’ from the Better Business Bureau. Indeed, subscription fraud is not a rare occurrence. The Federal Trade Commission (FTC) receives over 10,000 complaints each year from consumers that witness this variety of fraud. Nor is subscription fraud endemic to a particular area of the country. The Better Business Bureau has logged complaints from virtually every state in the union. Tragically, the intentions of magazine sales crews may not stop at subscription fraud. One former sales crew member interviewed by the New York Times testified that he regularly stole from his customers, including such items as “wedding rings, watches, necklaces, money, checks, shoes, clothing, glasses, [and] hats.” Unlicensed peddlers can be especially dangerous. Columbia County (Ga.) law enforcement apprehended 17 members of a sales crew, 5 of whom had criminal records involving violent crimes, in February 2011.
Given the potential for fraud anytime a salesperson rings the doorbell, consumers should take some basic precautions that can improve their safety and security. First of all, as the consumer protection blog Consumerist suggests, “there are better ways of buying magazine subscriptions and of supporting teens, charities, and troops, and there’s no reason the two worlds need to be mashed together on your front porch without warning.” Instead of handing a check to a stranger right then and there, consider asking the salesperson for more information about the charity he or she represents, and commit to making a donation online or over the phone.
Subscribing to a magazine can be achieved just as easily through the Internet or phone. For consumers who have already made a “front-porch” purchase or might consider doing so in the future, the FTC has instituted a “Cooling-off Rule” that gives consumers three business days to cancel purchases of $25 or more made at their home for a full refund. Also, under the Rule, the salesperson must convey the customer’s right to cancel at the time of sale and provide two cancellation forms along with a receipt. Any salesperson that does not explain how to cancel or provide forms to do so should automatically raise a red flag. Moreover, consumers who have made a purchase within the past three days but distrust the legitimacy of their purchase have the right to a full refund from the seller.
Government officials have attempted to stem the subscription fraud epidemic, but since the problem persists, consumers should also exercise vigilance to help root out fraud. Before making a purchase, always ask the salesperson to see a valid solicitation license and, if possible, research the company or charity with the Better Business Bureau (www.bbb.org). If the salesperson pressures you to make a decision immediately, tell him or her to come back tomorrow once you’ve done your homework. Consumers who suspect they’ve been victims of fraud should file a complaint with local law enforcement, as well as with the BBB or FTC. Newspaper and magazine publishers are also on the lookout for fraud (e.g. The Wall Street Journal and The Nation magazine) so make sure to check with them to see whether your subscription has been registered in their system. FIGHT FRAUD: Steps to take when a magazine salesperson approaches you