FTC Crackdown on Visa Trial Memberships. Does this apply to Adult Websites?

[mahoney]

It seems as thought the Federal Trade Commission has cracked down on Free Trial Memberships and even trial memberships like most adult websites offer. Has anyone heard about this and does it apply to Adult Websites? I was told that the only way around this is to process offshore but that doesn't sound right to me. Below is the full Article. Please let me know what you think about this. http://www.creditcardguide.com/credi...ard-abuse-183/

Visa, FTC Crack Down On Online Credit Card Abuse

In an unprecedented move, Visa Inc. last week took steps to boot out 100 merchants for credit card abuse linked to deceptive marketing practices. The scams involve bogus free trial offers that that trick consumers into unwittingly signing up for recurring monthly credit card charges, sometimes as high as $79.75.

Visa also joined forces with the Federal Trade Commission and the Better Business Bureau to bring greater consumer awareness about the issue. Officials from Visa and BBB appeared together with the Director of the FTC?s Bureau of Consumer Protection, David C. Vladeck at a press conference on Friday to caution consumers about this increasingly common Internet marketing practices.

?BBB has received thousands of complaints from people who learned the hard way that a free trial can cost a lot of money in the end,? says Steve Salter, Vice President of BBBOnline.

Almost one out of three of consumers (29 percent) have fallen for online marketing scams that saddle them with unwanted monthly credit card charges, according to a recent survey conducted by Visa, Inc.

The scam involves so-called ?negative option? marketing. In this practice, instead of signing up for an offer for e.g. a monthly subscription service, consumers are required to actively cancel out of it. Failure to do so is taken as permission to begin charging recurring subscription fees to the consumer?s credit card each month.

Online merchants trick consumers into giving out their credit card information by promising free trials for hot products, ranging from acai berries, reservatol, colon cleansers, and teeth whiteners to bogus debt consolidation services or lucrative-sounding offers for working from home. The real terms of the offer are buried in hard-to-read print at the bottom of the page, which most consumers never read. Many websites feature pre-checked consent boxes at the bottom of the page, so that the consumer has to actively uncheck the box to avoid being signed up for the monthly subscription product.

The more aggressive marketers include photos of Oprah and Dr. Oz as part of the marketing material to catch consumer interest and give the impression that the product is endorsed by the celebrities. In addition, many of the companies put cardholders through hoops when they try to cancel the monthly charges and return products.

The crack-down comes even as Visa, along with MasterCard and American Express, have come under scrutiny from Congress in connection with another online credit card scheme involving $1.4 billion in credit card charges from as many as 30 million cardholders via so-called post-transaction marketing schemes.

According to Visa, the company took steps to terminate the merchants? contract after monitoring the merchants since this summer as part of Visa?s ongoing tracking of merchant compliance. High levels of credit charge disputes are often an indication of deceptive marketing practices; according to Visa, merchants who use deceptive marketing practices can have up to 20 times as many disputes and requests for charge-backs as the average e-commerce site.

What can you do to protect yourself when shopping online, and what should you do if you have already fallen victim to this type of scam? Visa, the FTC and BBB offer the following advice to help you spot deceptive online offers:

Be suspicious of any online offer that promises you something for free. There is no such thing as a free lunch! Read through all the terms and conditions, particularly look for the fine print where the real terms of the offer are detailed.
Look out for pre-checked boxes-they typically mean that you?re being signed up for products or services you don?t really want.
If the online merchant is unknown to you, check the company?s Reliability Report out at the BBB website.
Check your credit card statements carefully each month and follow up immediately on any charge you don?t recall making. Be particularly watchful for small, recurring charges that are easy to overlook, but which can quickly add up over time.
If you spot a charge you didn?t authorize, first call the merchants, and if they don?t work with you, contact your credit card issuer to file a dispute and get the charges reversed. Don?t delay, most credit card issuers will only cover unauthorized charges if you file a complaint within 60 days of the charge.

In addition, help out other consumers in a similar situation by filing a complaint with the FTC, so that the FTC track and crack down on companies that engage in questionable online marketing practices. Go online at ftc.gov or call 1-877-FTC-HELP.

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[PornGreen]

article is 6 months old

[SallyRand]

Originally Posted by mahoney

It seems as thought the Federal Trade Commission has cracked down on Free Trial Memberships and even trial memberships like most adult websites offer. Has anyone heard about this and does it apply to Adult Websites? I was told that the only way around this is to process offshore but that doesn't sound right to me. Below is the full Article. Please let me know what you think about this. http://www.creditcardguide.com/credi...ard-abuse-183/

Visa, FTC Crack Down On Online Credit Card Abuse

In an unprecedented move, Visa Inc. last week took steps to boot out 100 merchants for credit card abuse linked to deceptive marketing practices. The scams involve bogus free trial offers that that trick consumers into unwittingly signing up for recurring monthly credit card charges, sometimes as high as $79.75.

Visa also joined forces with the Federal Trade Commission and the Better Business Bureau to bring greater consumer awareness about the issue. Officials from Visa and BBB appeared together with the Director of the FTC?s Bureau of Consumer Protection, David C. Vladeck at a press conference on Friday to caution consumers about this increasingly common Internet marketing practices.

?BBB has received thousands of complaints from people who learned the hard way that a free trial can cost a lot of money in the end,? says Steve Salter, Vice President of BBBOnline.

Almost one out of three of consumers (29 percent) have fallen for online marketing scams that saddle them with unwanted monthly credit card charges, according to a recent survey conducted by Visa, Inc.

The scam involves so-called ?negative option? marketing. In this practice, instead of signing up for an offer for e.g. a monthly subscription service, consumers are required to actively cancel out of it. Failure to do so is taken as permission to begin charging recurring subscription fees to the consumer?s credit card each month.

Online merchants trick consumers into giving out their credit card information by promising free trials for hot products, ranging from acai berries, reservatol, colon cleansers, and teeth whiteners to bogus debt consolidation services or lucrative-sounding offers for working from home. The real terms of the offer are buried in hard-to-read print at the bottom of the page, which most consumers never read. Many websites feature pre-checked consent boxes at the bottom of the page, so that the consumer has to actively uncheck the box to avoid being signed up for the monthly subscription product.

The more aggressive marketers include photos of Oprah and Dr. Oz as part of the marketing material to catch consumer interest and give the impression that the product is endorsed by the celebrities. In addition, many of the companies put cardholders through hoops when they try to cancel the monthly charges and return products.

The crack-down comes even as Visa, along with MasterCard and American Express, have come under scrutiny from Congress in connection with another online credit card scheme involving $1.4 billion in credit card charges from as many as 30 million cardholders via so-called post-transaction marketing schemes.

According to Visa, the company took steps to terminate the merchants? contract after monitoring the merchants since this summer as part of Visa?s ongoing tracking of merchant compliance. High levels of credit charge disputes are often an indication of deceptive marketing practices; according to Visa, merchants who use deceptive marketing practices can have up to 20 times as many disputes and requests for charge-backs as the average e-commerce site.

What can you do to protect yourself when shopping online, and what should you do if you have already fallen victim to this type of scam? Visa, the FTC and BBB offer the following advice to help you spot deceptive online offers:

Be suspicious of any online offer that promises you something for free. There is no such thing as a free lunch! Read through all the terms and conditions, particularly look for the fine print where the real terms of the offer are detailed.
Look out for pre-checked boxes-they typically mean that you?re being signed up for products or services you don?t really want.
If the online merchant is unknown to you, check the company?s Reliability Report out at the BBB website.
Check your credit card statements carefully each month and follow up immediately on any charge you don?t recall making. Be particularly watchful for small, recurring charges that are easy to overlook, but which can quickly add up over time.
If you spot a charge you didn?t authorize, first call the merchants, and if they don?t work with you, contact your credit card issuer to file a dispute and get the charges reversed. Don?t delay, most credit card issuers will only cover unauthorized charges if you file a complaint within 60 days of the charge.

In addition, help out other consumers in a similar situation by filing a complaint with the FTC, so that the FTC track and crack down on companies that engage in questionable online marketing practices. Go online at ftc.gov or call 1-877-FTC-HELP.

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One word.

Yes.

Makes no difference where you are located, if you accept any of the credit cards based in the USA; read: All of them, the rules apply.

[Chris]

Yes it does but believe it or not adult plays by the rules a little better regarding trials than the mainstream world does.

adult we clearly have it marked on our sites in large enough print to read that it recures at X amount ...well you guys should.

The mainstream companies that are getting hit are companies that just flat out dont list that they are enrolling into a subscription based product

[shimmy2]

i havent sold with trials of any kind in almost 10yrs i want the full 30 bucks upfront

[mahoney]

Originally Posted by Chris

Yes it does but believe it or not adult plays by the rules a little better regarding trials than the mainstream world does.

adult we clearly have it marked on our sites in large enough print to read that it recures at X amount ...well you guys should.

The mainstream companies that are getting hit are companies that just flat out dont list that they are enrolling into a subscription based product

Thanks Chris, do you know of an article or website where the "Rules" and regulations are laid out ? I would find that very helpful.

[fuzebox]

Adult is a very small fish in a sea full of herbals, teeth whitening, and "business opportunities"

[SallyRand]

Originally Posted by Chris

Yes it does but believe it or not adult plays by the rules a little better regarding trials than the mainstream world does.

adult we clearly have it marked on our sites in large enough print to read that it recures at X amount ...well you guys should.

The mainstream companies that are getting hit are companies that just flat out dont list that they are enrolling into a subscription based product

Absolutely correct and thank you for your informative and timely post!

[marlboroack]

Most of my friends who bought porn pay less than 40$ a year.

[Alprazolam]

no. doesn't apply. no seriously.

[V_RocKs]

They will be coming for adult soon enough... But this is for acai berry shit.

[mahoney]

Originally Posted by V_RocKs

They will be coming for adult soon enough... But this is for acai berry shit.

I agree....it seems the writing is on the wall

[marketsmart]

Originally Posted by fuzebox

Adult is a very small fish in a sea full of herbals, teeth whitening, and "business opportunities"

yes, this is a result of the acai berry scams..

they should have arrested one well know promoter here based on the fact that he was buying all the berry programs and forcing them to use his processing..






.

[epitome]

Originally Posted by shimmy2

i havent sold with trials of any kind in almost 10yrs i want the full 30 bucks upfront

You do not understand how trials should and do work then.

If done correctly, trials can add amazingly to your bottom line. If you *need* the $30 upfront then you are not making enough to support yourself and should figure out what you can do to increase your income (the answer may even be trials).

When I'm surfing, I assume that if I'm giving someone my credit card number, I am being charged. If it looks too good to be true, I read the small print and if I cannot find any, I don't enter my info because they're probably going to burn me.

I like to hope most surfers would exercise that same common sense, but we all know far too many don't.

[mahoney]

Originally Posted by epitome

You do not understand how trials should and do work then.

If done correctly, trials can add amazingly to your bottom line. If you *need* the $30 upfront then you are not making enough to support yourself and should figure out what you can do to increase your income (the answer may even be trials).

When I'm surfing, I assume that if I'm giving someone my credit card number, I am being charged. If it looks too good to be true, I read the small print and if I cannot find any, I don't enter my info because they're probably going to burn me.

I like to hope most surfers would exercise that same common sense, but we all know far too many don't.

Yeah, but your missing the point. The ftc is trying to STOP all trial memberships. This will have a big effect on the Adult biz.

[JamesGw]

I don't see many issues with adult sites. The worst are make money online websites.