Congress demands info from Web loyalty firm

Vertrue, one of three companies accused of misleading consumers into signing up for recurring fees, gets a subpoena from a Senate committee.

Update 1:15 p.m. PDT: Added quotes from Vertrue.

Vertrue, which operates a so-called Web loyalty program, apparently isn't as forthcoming with information as some U.S. Senators would like.

On Tuesday, the U.S. Senate's Commerce Committee issued a subpoena to Vertrue requiring that the privately held company turn over documents that committee investigators requested in May, including communications with business partners and credit card companies.

Companies like Norwalk, Conn.-based Vertue, along with WebLoyalty and Affinion, are marketers that make "cash-back" and coupon offers to consumers and charge those who enroll in their loyalty programs. The three are under investigation after scores of consumers complained that they were duped into paying monthly fees.

Vertrue.com

George Thomas, a Vertrue spokesman, said that it was Vertrue execs who requested the subpoena as they would refuse to give up consumers' privacy unless ordered to by authorities.

"We requested in writing that the subpoena be issued and that's because one of the items requested was consumer information," Thomas said, "including consumer complaints and inquiries over the course of a decade, which would include personally identifiable information about the consumer."

In a CNET News story published last week , WebLoyalty said that its service is popular with the vast majority of users. Typically, Web loyalty programs--which offer discounts or cash back if the customer just enters an e-mail--present offers as a consumer is about to finish a purchase. Many who complain about the programs say that the terms are tucked into a dense field of fine print and graphics.

Also, many consumers who allegedly "opt in" to the program don't know that by just keying in their e-mail address, companies like Vertrue and WebLoyalty can acquire access to their credit cards. WebLoyalty's CEO, Rick Fernandes, said last week that his company pays retailers such as Buy.com, Fandango, and Orbitz for access to their customers' cards.

It's worth noting that while Thomas and Vertrue say they wouldn't give up consumers' private information unless ordered to, Buy.com, Fandango and Orbitz appear to have a much lower threshold for sharing that information.

For anybody looking for more information, they should visit Consumerist.com, which has done an excellent job of covering WebLoyalty and Vertrue for several months. To see a long list of consumers complaints about these companies, try here.

 

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