Red flag raised again over door-to-door magazine sales

Magazine coversHere's a cautionary tale for anyone who has someone come to the door selling magazines. Susan Lewis had her doubts about the two young men who stopped by her house last week to sell her a magazine subscription, but she agreed to listen to their sales pitch.

One of the men pulled out a $20 bill and told Lewis he could give her a $20 discount. He also told her that if he received enough points for selling subscriptions, he could earn a trip to Maui. Lewis bought a two-year subscription to Elle magazine and wrote a check for $51. But after the men left, she dialed the phone number on the receipt and discovered it wasn't valid. The next morning she asked her bank to stop payment on the check.

"Whoever puts these young men or women up to this needs to stop," Lewis, who lives in Great Falls, Mont., told Consumer Ally. "I didn't question any of it, but I just knew something was going on."

Lewis isn't the only one who has complained about such sales tactics. Last year, the Better Business Bureau put out a nationwide alert warning parents, youth and consumers about door-to-door sales crews hawking magazines. The BBB teamed up with law enforcement to issue the warning because of numerous police reports indicating that homeless kids and young adults were being hired and taken across the country to do these jobs. In one publicized case two years ago, a 16-year-old runaway girl in Spokane, Wash., claimed she was monitored during the day and felt unable to leave a traveling sales company.

This year, several Better Business Bureaus have reported that they've continued to receive complaints from consumers about questionable sales tactics from such sales crews as well as concerns that young people are being exploited.

"This industry, due to the fact that they are employing young people from out of the area, raises red flags," said Zan Deery, lead investigator for the BBB serving Eastern Washington, North Idaho and Montana. "Many consumers have reported that they don't believe the stories being pitched, that there are too many questionable pitches, and they feel badly for these kids who are doing the pitching, because they are being misused somehow."

This week, Deery sent out an alert about Atlantic Circulation, Inc. deploying young adults in Montana and elsewhere. The company, which has a "C" rating, has been on the BBB's radar for a number of years.

Deery's BBB office teamed up with Lutheran Community Services Northwest to alert teens about traveling job opportunities posted online. The ads, which have been posted on Craigslist and MySpace, describe the jobs as fun and offer opportunities to travel. An ad posted in June reads that a national company is looking for "skaters, BMX bikers, boarders, surfers and ALL types of OUTGOING girls and guys." Deery said the BBB traced the number in the ads to a company called Coast-to-Coast Sales, Inc. based in Atlanta. The BBB in that region has given the company an "F," the lowest rating a company can receive.

Consumer Ally contacted the number listed on one of the ads and reached a man who identified himself as Brandon Mouzakis, the sales manager and owner of a company called Supreme Marketing, which sells magazine subscriptions. He said he was not connected to Coast to Coast even though the phone number is linked to a website for a company of the same name that has since been taken down.

"We've got a pretty good company and we treat people pretty good," Mouzakis said.

Mouzakis explained that workers are independent contractors, some of whom take the jobs in the summer. He said contractors travel all over the country and that the company pays for their hotel and meal expenses. If someone wants out, Mouzakis said he would buy the person a ticket home. He defended his industry when asked about the number of complaints filed against door-to-door sales crews.

"I've had all kinds of flak and people say all kinds of things about my industry," Mouzakis said. "There's good companies and bad companies. I hope people understand that there's more than one company."

When Consumer Ally looked up Mouzakis' company on the BBB's website, however, it found that the company is rated an "F". In the past 36 months, the BBB has processed 31 complaints. The company failed to respond to four complaints and two complaints were not resolved, according to the BBB's report.

Fred Elsberry, president of the BBB serving metro Atlanta, Athens and northeast Georgia, told Consumer Ally that the most common complaint his office has received about such companies is from customers who say they've requested but haven't received their refunds. The other frequent complaint is that the sales crews misrepresent themselves or make up a story about why they're selling the magazines.

"They train these young people selling door to door to represent themselves as local students," he said. "They're getting these kids from all over the country."

Meta Marshall, the missing persons specialist for the Spokane Police Department who worked on the runaway case two years ago, said both the youth and consumers are victims.

"But somebody's getting rich so I can't imagine why they would stop," she said.

Margie Morgan Alexander, a Mississippi resident, said a young man who sold her two magazine subscriptions told her he was doing the job so he could study abroad in Mexico. She said she called Coast to Coast 15 times and left numerous messages. Eventually she got through to someone who told her that her magazine had been mailed to the wrong address.

"I finally got one magazine but not a year's worth subscription," she said. "Already they're sending me a bill...they have terrible customer service."

Kathleen Duncan said she caved in and bought three magazine subscriptions for $195 in January while staying in her Florida home. She said a young woman in her early 20s told her she was participating in a marketing class homework assignment to help her become a better speaker because she was shy. She also indicated she was trying to earn money for an overseas trip. The woman was very personable and asked Duncan about herself.

"She worked it well, sucking me into a conversation," Duncan told Consumer Ally. "She said, 'Tell me about you.' Everybody likes to talk about themselves. I think that's pretty effective."

Duncan hasn't received any of her magazines, but said she did hear back from Coast to Coast after numerous attempts to reach someone. An e-mail from the company explained she would receive her magazines in four to six weeks.

"I have learned," Duncan said. "If I never see my magazines, I feel vindicated that at least the BBB is looking into them."

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