Last week, over 22 large online retailers, including
GameStop, have been subpoenaed by the New York State Attorney General's office, concerning credit-card information sharing with third-party companies. According to a news release made by the office of Andrew Cuomo, New York's Attorney General, the practice "deceptively link[s] unsuspecting consumers to fee-based membership programs that charge unauthorized feeds under the guise of discount offers."
In keeping with the news release, the major online retailers end up at times redirecting their customers to other sites, allowing a third-party to sometime obtain the web-surfers' personal credit-card information.
The Attorney General's office explains that, "Cuomo's investigation has found that when consumers shop online from familiar retailers, they are often presented with a discount or cash-back incentive offer as they complete their purchase. When consumers click on the discount or incentive banner, they are unknowingly directed to a membership program seller's Web page that is separate from the online retailer's site. The consumer is then instructed through large, colorful print and voice prompts to accept the discount or incentive." But what so far sounds like nothing but aggressive advertising quickly turns into something more similar to
fraud.
The news release further explains that, "Information about joining the membership program and its ramifications, including the fact that the consumer is agreeing to transfer his or her credit or debit card account information, is buried in fine print and cluttered text. Small and recurring charges then begin to appear on consumers' credit or debit card bills from unfamiliar companies. Because of the low dollar amount, the charges may go unnoticed for some time."
The three discount companies mentioned are Webloyalty, Affinion/Trilegiant and Vertrue, and GameStop, FTD.com and Orbitz.com are among the 22 ones subpoenaed by the AG's office. MSNBC news has reported that movie-ticket seller Fandango has already agreed to change its redirect policy, explicitly warning its customers that the additional offers they receive are from a different company, but also that it agreed to pay $400,000 to them, as a way of making amends.
When GameStop was asked to reply on the matter, the company's Vice President, Chris Olivera, said that, "I can confirm that we were
subpoenaed," adding that, "We are still reviewing the matter but do intend to work fully with the New York AG's office. Beyond that, I would not be able to provide any additional comment."