|Abdul Fattah Ismail|
This past Wednesday was still generating buzz from the release of iPhone 4 and Yahoo’s Internet Week Conference in Manhattan. Under the radar, though, the Senate quietly approved three bills, one of which will affect online marketing. Senate Committee Chairman John (Jay) Rockefeller, Democrat of West Virginia, offered the legislation, effectively barring companies from automatically passing a consumer’s credit or debit card information to a third-party online partner. It would also require those third-party merchants to clearly disclose terms of the offer to consumers.
According to an article from The National Journal’s Tech Daily Dose, Rockefeller started an investigation of companies using data-pass marketing tactics to mislead consumers into signing up for discount membership clubs and other services as part of other online transactions with respected online retail sites. The three firms cited in the report were Affinion, Vertrue, and Webloyalty. They had partnered with established retail firms to enroll millions of unsuspecting consumers netting more than $1 billion in revenues for these firms and their partners.
The committee also noticed that refunds were difficult to obtain from these three firms. They had created policies to minimize the amount of money they would have to return to consumers that inadvertently enrolled into clubs.
The firms have changed their policies in light of the investigation, but it goes to show that you can never be too careful in purchasing products online. It is imperative to be cognizant of all the factors at play, including the fine print, your bank accounts, and holding a confirmation note. I found it discouraging to hear that payment systems operated by American Express, MasterCard, and Visa were continually being accessed by these firms to perpetrate these fraudulent practices. Microsoft took a hard stance against click laundering, and the consumer must do the same for their own sake. If one sees a note asking for third-party information, always say no. You can live without passing that around the internet. This situation will be monitored here.