Attorney General Terry Goddard announced on the 25th of June a record settlement of $1,375,000 with Acai seller Central Coast Nutraceuticals, Inc (“CCN”). CCN were allegedly using deceptive online advertising and sales practices, offering ‘free trials’ of health products that were difficult or impossible to cancel, and charging for products the customer had not requested.CCN were also accused of shipping to – and charging – the customer products that were explicitly deselected during the ordering process.
Typical “Free Trial” Business Model
Despite the continued warnings for people not to trust Acai Free Trial offers, people still fall for the scam: the ‘offer’ seems attractive and all details aboutre-billing and the associated ‘bonus products’ are hidden away in barely legible small print. CCN is alleged to have compounded the problem by never responding to emails and leaving customers who phoned in with complaints on hold for over an hour. Attorney General Terry Goddard’s office received 100s of complaints from disgruntled customers.
Free – or reduced price – trials for products and services which are later subject to large price increases have been around for a long time, and there is nothing wrong with this approach per se. The problems occur when, as in the CCN case, consumers are not aware – or are actively mislead – as to the consequences of their order. The difficulties in cancelling the order and monthly charges serves to compound the issue still further.
Acai Not To Blame
It is important to note that Acai and acai products have not been specifically singled out as being the culprit in this settlement:CCN sold a whole range of health products using the same deceptive tactics. Acai itself can be a powerful addition to any diet and lifestyle, and the shady antics of one rogue supplier and distributor should not serve to tar legitimate online retailers with the same brush.
Restitution From The Settlement
Some $350,000 of the $1,375,000 has been set aside for consumer restitution ($1 million going towards civil penalties to the state, and the remaining $25,000 covering the state’s costs in bringing the action). Consumers who feel that they fell victim to CCN’s deceptive sales and advertising practices should file a complaint with the Arizona Attorney General’s Office by close of business on August 17, 2009 to be eligible. Those who have already filed a complaint will be included in the pool of customers eligible for restitution.
If you are one of those people who feel that CCN owes you an apology (and some money), then we wish you the best of luck with your claim.
