FoolMeOnce.com Update

Last month I told you how I got scammed by an online coupon “service” which I nicknamed FoolMeOnce.com. Come to find out, companies like FoolMeOnce.com call their service online loyalty programs.

This month I have mixed feelings when I tell you that Senate hearings into these online loyalty programs started in mid-November and are expected to resume early next year. Why are my feelings mixed?

On the one hand, the cat is finally out of the bag and legislators are acting. On the other hand, the problem is far bigger than I could have imagined. This scam flew so far under the radar for so long, it is estimated that more than $1.4 billion has been collected from unsuspecting Internet shoppers.

Retail websites I previously trusted, like FTD, Buy.com and US Airways along with 16 others, have collected more than $10 million each. Classmates.com has earned more than $70 million! Another 88 companies reportedly garnered between $1 and $10 million.

According to the Senate Report, online retailers “earned” a total of $792 million from their affiliation with FoolMeOnce companies.

What did these retailers do to earn all this moolah? They sold your and my credit card numbers to FoolMeOnce after we bought something from them online. That’s how they rewarded our loyalty!

Then the FoolMeOnce companies automatically charged our credit cards a monthly fee between $9 and $12 until we took notice and forced them to stop.

Reporter Greg Sandoval for CNet.com wrote, “For years, Web shoppers have complained that they were signed up to some Web loyalty program without their knowledge and were charged fees until they discovered the problem and complained. Some paid fees for years.”

In my opinion, it should be illegal for retailers to ever sell customers’ credit card information to third parties. What do you think?

[Read the full CNet report here.]

Tags: online marketing scams, loyalty program scams, coupon scams, buyer beware, online shopping alert, read the small print, Senate hearings on loyalty programs, check the Ripoff Report