MemberWorks Inc. will pay approximately $1 million in fees and refunds for violations of Florida’s Unfair and Deceptive Trade Practices Act.
Attorney General Charlie Crist settled with MemberWorks Inc. Tuesday, thereby ending a four-year investigation into MemberWorks’ telemarketing practices.
The state filed suit in October 2003, accusing Stamford, CT-based MemberWorks of using telemarketing practices that caused unwanted credit card charges to be billed to Florida consumers’ accounts.
More than 1,000 Floridians complained about receiving unwanted credit card charges for MemberWorks’ programs. The company typically marketed its products in conjunction with infomercial products, and consumers calling to order products were told they would receive a MemberWorks membership as a bonus for their purchase, according to the Attorney General’s office.
The bonus actually resulted in a credit card charge for MemberWorks’ membership programs if the consumer did not actively seek to cancel the purchase, Crist’s office stated.
Also as part of the settlement agreement, MemberWorks must issue double refunds to any Florida consumer who receives a credit card charge for a MemberWorks program where MemberWorks cannot provide documentation showing that the consumer consented to the charge, according to officials.
Furthermore, the agreement requires MemberWorks to clearly disclose all terms and conditions of its programs, to obtain consumers’ express consent to charge their credit cards for MemberWorks’ programs, and to report their compliance with the double refund policy for a period of three years.
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