Pop-ups ads tricking people into monthly charges

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There’s a great article in today’s New York Times about a reporter discovering a $10 fee from a company she didn’t know in her bank statement, and tracking down to the source. It turns out her husband had signed up without realizing it, and she only found it by looking through their bank statement carefully:

The other day, as I was trying to avoid making eye contact with $168.09 (jeans and a T-shirt) and $40.24 (how can a tank of gas cost that much?), I happened to notice a mysterious $10 charge.

It was for WLI*RESERVATIONREWARDS.CO.

It didn’t ring a bell. Was Reservation Rewards a surcharge for a hotel room? A magazine subscription? Or a digital audio download?

I phoned the toll-free number. A customer service representative told me that my husband had enrolled in a subscription service that offered members discount coupons for travel and restaurants. The cost was $10 a month.

That didn’t sound like my husband.

“Maybe when he bought something else,” the customer service representative said. “Like on Fandango.”

She describes that a $10 rebate offer appeared as a pop-up ad, “Good for your next Fandango purchase!” and that all he had to do was enter his email address, since Fandango already had his credit card information. In the fine print, which he didn’t read, it said that by taking the offer he was signing up for Reservation Rewards monthly service. But the punchline came later:

The next day, it got worse. That was when my husband received an e-mail message telling him that he had been a Reservation Rewards member since November 2005.

He phoned from his office to read the message: “We have issued a refund of $160.”

“They charged us $160?” I asked. “You were a member for 16 months?”

“I’ll never buy tickets at Fandango again,” he said.

There’s more to the piece, including an interview with Reservation Rewards’ CEO, and a mention that they are currently subject of a class action lawsuit about their practices. (That link also includes a list of all the sites with which they’ve partnered — and it’s a long and familiar list.)

I think very poorly of these kinds of businesses. Consumers’ wallets are constantly taxed by monthly fees, charges, subscriptions, and penalties that offer them little or no benefit, and act as deadweight loss on their income. Here are a few tips for avoiding charges like these:

  1. As the author of the article suggests, go over your bank and credit card statements carefully. Of course we hope this is one of the benefits of Wesabe, that you have better tools for going through just the new charges, and that you can research any merchant that shows up in your statement to find out what they do and whether they’re worth it for you. However you check your statements, though, be sure that you do.
  2. Ask for refunds of charges you don’t recognize. Every time you see a fee or a charge you don’t recognize, ask what it is, and ask what you have to do to remove it and have it refunded. This works for all kinds of fees, from the subscription charges the author found, to account fees, overdraft fees, and others.
  3. Block pop-up ads. We very strongly recommend the Firefox web browser, since it has pop-up blocking and other security and privacy features built-in. It also does a great job of letting you get to a pop-up window on those rare times when you want to see it. By default, though, you should never have to see those ads.

It turns out that 17 Wesabe users have charges from Reservation Rewards, totaling $397.00. Because of the way our privacy wall works, we have no way of knowing who those people are, but I’ve written a Wesabe tip pointing to the article, matched against “Reservation Rewards” as a merchant name. Now, whenever a Wesabe user gets one of those charges, this is what they’ll see in their accounts:

res rewards

That tip link has pointers to the Times article, the class-action information, and the toll-free number you can call to ask for a refund. This is one of the big ideas behind Wesabe — one person does the research to root out this charge, and everyone on the site benefits. It’s easier to watch your statements closely when they’re telling you right there what to look for.

I’m glad this reporter tracked down the charge. Hopefully, having this practice highlighted in the New York Times will make it harder for them to continue doing business by taxing consumers with underhanded offers.

7 Responses to “Pop-ups ads tricking people into monthly charges”

  1. Anthony Says:

    In addition to helping me track my spending, Wesabe has really made it easy for me to be vigilant for unauthorized purchases. Apparently my credit card was one of the millions stolen from TJ Maxx, but I wasn’t worried knowing that any suspect charges would stick out like a sore thumb. Thanks Wesabe.

  2. awardtour Says:

    This scam of a company actually charges under multiple names. When I got dinged the transactions description was “WLI*SHOPPERDISCOUNT 800-889-8776”.

  3. Marc Hedlund Says:

    Anthony, I’m really glad to hear it. We didn’t design the transaction edit view with that in mind, but it’s a great side-effect, and a happy accident.

    awardtour — thanks much. I’ll add that name to the tip.

  4. Matthew Amster-Burton Says:

    This is a much more old-school kind of scam, I think, but a while back I had a credit card that, on the payment slip, had a signature line. If you signed on the line (which had some tiny, tiny print above it), they’d sign you up for some bogus credit insurance product with a monthly fee. I ended up canceling that card (and telling them why) because I was never totally sure that I wouldn’t absentmindedly sign on the line before mailing my payment. Of course, now I pay online and am subject to new, exciting, and different scams.

  5. Jake Says:

    I love that in Wesabe there are ways now for communities to get people informed on their bills and what they can do to prevent charges like this from occurring. I think this truly shows the beauty of Wesabe.

  6. Webloyalty Customer Service Says:

    Dear Wesabe and Wesabe Members:

    Webloyalty.com protects its reputation and monitors the blogosphere to insure information posted on our company is truthful and accurate. Through this monitoring, we found this blog.

    We would like to speak with you directly but do not have your contact information. If you are unhappy with your subscription or have any questions regarding your membership to Reservation Rewards or Shopper Discounts & Rewards, please contact Webloyalty.com Customer Service at either 1-800-732-7031 or send an email message to customerservice@webloyalty.com. One of our customer service representatives will be happy to help you.

    If you prefer, please contact me at customerserviceinfo@webloyalty.com

    Regards,
    Walter Dabek
    Vice President
    Webloyalty.com Customer Service

  7. Sara Howland Says:

    I recently discovered I had charges on my bank account from reservations rewards dating back 12 months. It was MovieTickets.com that gave my personal information – I had clicked for a $10 reward and then closed the pop-up, not realizing that I had unwittingly given MovieTickets permission give my personal banking information to reservations rewards (what’s in it for MovieTickets.com I wonder? Do they get a cut?) It is very worrying and any reputable company would not use these tactics. I was offered a refund, but I beleive this is just to keep us quite. That means that Reservations Rewards can claim to have very few complaints. They just rely on those of us that do not notice the charge and do not claim a refund.

    Reservation Rewards claim to have millions of happy customers. What they really mean is that they have millions of unwitting customers that probably do not realize they are paying them for nothing!!

    I am disapointed based on all of the online comments regarding this scam that more has not been done to prevent this activity. When I read up on the class action nd Reservation Rewards have no intentions of chaning their practice.

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