A pair of Florida firms will refund $150,000 to some New York consumers and pay $100,000 in penalties, costs and fees to settle state allegations that they tricked consumers into signing up for fee-based membership programs without their knowledge.
An investigation by New York Attorney General Eric T. Schneiderman’s office found that the related entities – Profinity LLC and Family Savings LLC – “deceptively marketed” membership programs that claimed to provide grocery coupons, retail discounts, restaurant vouchers, magazine subscriptions, roadside assistance, legal referral services, technology support, identity theft protection, credit scores and credit monitoring services, all for a monthly fee. The state claimed that the firms tricked consumers during misleading telemarketing calls that promised “free gifts” or “risk-free” trials.
Other consumers bought products from third-party companies but were misled during purported verification calls by Profinity into thinking they were speaking to a representative of the original company seeking to confirm the purchase. Instead, the state claimed, consumers were duped into giving their credit or debit card information to Profinity, and enrolling into one of its programs.
Details of the monthly fees were “buried in fine print and inconspicuous text on the webpage” so that consumers didn’t know they were enrolling in a fee program by accepting a “free” trial. Consumers often incurred fees for months before realizing they had been tricked, the state said, and struggled to get the membership canceled.
Much of the deception occurred from Dec. 15, 2011, to Oct. 9, 2012, when consumers responded to deceptive advertisements for placed by Profinity partners for fictitious jobs, apartments and government benefits on third-party websites. The ads urged consumers to get a “free” credit score and credit report by clicking on an embedded hyperlink that led to Profinity’s sign-up page, and the firm used “buttons” of different sizes to trick consumers into paying an extra $29.95 to get scores and reports from all three credit bureaus rather than just the one they were promised.
“Consumers, some of whom were simply seeking jobs or rental apartments online, were tricked into paying for services with monthly fees that they did not want or need,” Schneiderman said. “My office will aggressively investigate companies that scam New Yorkers out of their hard-earned money through misleading Internet and phone offers.”
New Yorkers who enrolled in the firms’ Pro Credit membership program between Dec. 15, 2011, and Oct. 9, 2012, paying $29.95 for credit scores and reports, will get a full refund. Those who were enrolled in Family Savings, Pro Save & Protect, or Pro Credit membership programs since April 2010, or who bought up to Profinity’s Total Identity Protection membership program may be considered for a refund by filing a written complaint to Schneiderman’s office within the next six months, or calling (800) 771-7755.
Besides the payments, the two firms also agreed under the settlement to reform their online marketing practices, ensuring consumers know they’re enrolling in a membership program, obtaining “express informed consent” before billing anyone, ensuring offers are clearly labeled, and improving customer service.