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April 3, 2015

Florida Buying Club Company Agrees to Refunds and Stop Marketing to Iowa Consumers

Miller alleges company illegally enrolled Iowans in multiple buying clubs when they responded to a postcard offering a $100 gift card

(DES MOINES, Iowa) A Florida buying club operation will pay the state nearly $45,000 for refunds to more than 2,600 Iowa consumers it charged for memberships for which they did not intentionally enroll, through an agreement with Attorney General Tom Miller.

The agreement, called an Assurance of Voluntary Compliance, requires Global Travel International Inc., of Maitland, to pay for refunds to Iowans charged for “Valu-Pass”, “Journey Pass”, and “Go Shop and Save” memberships. The memberships claim to provide savings on retail or travel-related purchases.

According to Miller, Global Travel has unlawfully enrolled Iowans in its membership programs since 2008.

Consumer Lured by Misleading Postcard
The Consumer Protection Division began investigating last August when a Des Moines woman filed a complaint. The consumer received a postcard stating a business had been trying to reach her with “great news.” The mailing stated that she simply needed to call a toll-free number to obtain what appeared to be a $100 gift card to retailers like Walmart or Target.

According to the complaint, the woman called Global Travel and a company representative requested her debit card information for a $3.95 “shipping and handling charge” for the gift card. The consumer reported that the representative proceeded with a confusing sales pitch for a membership, but also assured her she was not buying anything.

The company then withdrew money from her checking account for a Global Travel membership called “Journey Pass.” Other Iowans lodged similar complaints against Global Travel for unwanted enrollments and unauthorized charges.

“Global Travel designed its deceptive postcard and confusing telephone pitch to lure consumers into paying unexpected membership charges,” Miller said. “We allege that the company violated Iowa’s Buying Club Law, which is one of the best protections Iowans have against what has become a nationwide scourge of predatory membership schemes.”

Iowa Law Requires Disclosures
Iowa law requires specific notices and disclosures when consumers are enrolled in buying club memberships.

“Had Global Travel followed the law and provided consumers with proper disclosures, it would have helped Iowans avoid unfair losses,” Miller added.

Miller noted that Iowa’s Buying Club Law has resulted in tens of millions of dollars returned to Iowa consumers over the last few years, and forced many questionable operations to steer clear of the state.

State to Issue Refunds
The agreement required Global Travel to provide the Consumer Protection Division with the company’s Iowa membership list. The division will issue refunds to eligible consumers, so consumers do not need to make a claim.

In addition to the consumer refunds, Global Travel agreed to a complete ban from Iowa marketing. As part of the agreement, the company denies liability.

“We’re happy to see these refunds, and equally happy that this operation will be pulling out of Iowa completely,” Miller said. “But Iowans need to be on guard against similar unwanted charges by other operators, and the best way to do that is to monitor credit and debit card statements for unauthorized charges.”

"Free" Gift Cards, "Free" Trial Offers & Buying Club Tips

  • Be suspicious of promotions that lure consumers in with gift cards and cash-back rewards. Strings are attached in the form of trial offers that convert to unwanted charges. And the promotions are often rigged so the gift card never gets delivered.
  • Be wary of any “free trial” offer or membership offer. Get the details and ask questions. Will you be billed automatically if you don’t cancel? By when must you cancel? How do you cancel? Will you receive a mail notice? Remember, they already may have your bank or credit card number to charge you.
  • Examine your credit card bills every month, your checking account and debit card statements, other financial accounts, and phone bills. Watch for unauthorized charges, and dispute them at once, in writing.
  • Watch your mail and email for notices that you will be billed for a membership unless you cancel. These mailings may look like junk mail or spam.

For more information or to file a complaint, contact the Attorney General’s Consumer Protection Division through the Attorney General’s website at www.IowaAttorneyGeneral.gov or email directly to consumer@ag.iowa.gov. Consumers can also call the Consumer Protection Division at 515-281-5926, or outside the Des Moines area, toll free, at 888-777-4590.

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