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Landing on the wrong list: Attorney General's buyer beware index is one list companies want to avoid.

"On 7-3-91, I sent |a credit company~ $7.95 for merchandise to be shipped to me, and I was to make monthly payments until paid for. In the first week of September, I called the company and was informed the phone number was disconnected. I then called information only to learn they disconnected, first temporarily then permanently, with no other number. I called the Better Business Bureau in Florida with no luck in ever getting through. Then I learned from CPD |Consumer Protection Division~ that, effective 7-1-91, |the credit company~, along with other businesses in Florida, was not allowed to sell items like them to other states."

That is an example of complaints the Arkansas Attorney General's office receives every day.

Often the complaints are resolved through communication between the two parties, mediated by state Attorney General Winston Bryant's office. A couple of letters, a phone call or two, and the complainant usually gets satisfaction of one kind or another in a short period of time.

When complaints begin to pile up, or a company fails to respond to communications from Bryant's office within an allotted time, action is taken.

That action is the Buyer Beware List.

Published on a quarterly basis by the state Attorney General's Consumer Protection Division, the list names companies or individuals who, for one reason or another, have been the subject of complaints by Arkansas consumers.

Travel scams, deceptive 1-900 telephone schemes and "sweepstakes awards" or "money findings" dominate the list, according to Bryant, whose office released its most recent edition July 28.

Many listed businesses are based outside of Arkansas. Telemarketing firms, a "business opportunities broker," auto brokers, credit services and construction contractors are some of the more prominent listings. Not to mention Psychology Today, the popular psychology publication based in Boulder, Colo.

"That's because of their failure to respond to correspondence by the Attorney General's office," Kay DeWitt, the state deputy Attorney General, says of Psychology Today. "A consumer didn't get his or her magazines from the subscription and the company never responded. Which I think is sort of odd ... it's relatively unusual for a company like that to never respond at all."

Some companies the Consumer Protection division has received complaints about are Advanced Interactive Communication, a Florida-based pre-approved credit card offering; BBS Management Corp. of New Jersey, an advance fee-loan broker; Home Products Warehouse of Nevada, a grandfather clocks mail-order firm; KBH Travel Group of Illinois, a vacation travel sales company; and Mirage International Trust Inc., suspected of running a pyramid scam out of Albuquerque, N.M.

On the local front, the list includes Advanced Education Corp. and Hankins Enterprises of Benton, a sweepstakes/mail order company; Area Services and American Flag Foundation of Little Rock; Britton Printing Co. of Walnut Ridge; Franklin's Nursery and Landscaping of Little Rock; First Strike of Piggott, a model airplane mail-order firm; Little Rock Carpet Cleaning, which has also used the names Power Steam and Aqua Steam of North Little Rock; and Craftmatic/Contour Inc., a North Little Rock distributor of therapeutic beds and chairs.

Craftmatic/Contour Inc. has 48 complaints filed against it with the Attorney General's office. Refunds for 28 of those complainants have amounted to $27,774.

Many of the businesses on the list are not full-fledged companies; they consist of little more than post office boxes or answering machines.

Several of them are no longer in business, such as National Health Care, a vitamin and skin-care product promotion firm that shut down operations in Little Rock in November and consolidated with its Shreveport, La., office; and National Lending & Credit Corp., another advanced-fee lending operation.

"It appears to us the principles left the area right about the time a civil investigative demand was due," DeWitt says of National Lending, which closed its Little Rock office about two weeks ago. Advanced-fee loan companies, which usually target people with poor credit histories, attract customers through 1-800 telephone numbers, promising to secure loans for them for a fee.

DeWitt says complaints have been filed against the company in other states and an investigation into the company on the Arkansas level still could occur.

Not Leaving The List

Even though companies like these are no longer in operation or have left Arkansas, Bryant's office maintains they belong on the list because complainants' problems have not been resolved.

"There's just no way we can do all the litigation we need to do, even with all the additional staff Winston has brought on," says DeWitt. The Consumer Protection Division includes three full-time lawyers, three investigators and two phone counselors.

"The fact that they're not listed in the phone book doesn't mean they're not doing business," she adds, citing the number of businesses that have operated under different names at various times, leaving the state only to return under a newly incorporated title.

"Why would a company have no physical location and four different post office boxes?" she questions.

The Buyer Beware List, once published yearly, appears quarterly in an attempt to be fair to companies on the list and to keep consumers more aware.

Getting off the list is easier than getting on.

According to the list's guidelines, a company will be named:

* if it fails to respond to a consumer's complaint on file with the Attorney General's office;

* if it fails to respond sufficiently to a subpoena or CPD civil investigative demand;

* if the company is the subject of three unresolved complaints by consumers within 30 days;

* if the company fails to provide customers with oral and written notice of cancellation of home solicitation sales three days in advance;

* or if the company is acting in violation of the Arkansas Deceptive Trade Practices Act or any other consumer protection laws.

To get off the list, a company simply has to "stop what they're doing," says DeWitt.

"There has to be a judgment call, whether or not we can get the consumer's money back. That's going to be our No. 1 priority," says DeWitt.

Litigation is one alternative, she says, although many companies are willing to make restitution to consumers as well as paying the state's attorney fees in order to avoid civil penalties and lengthy court battles.
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Author:Taylor, Tim
Publication:Arkansas Business
Date:Aug 10, 1992
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