Consumers Duped By Shopping Spree Scam

Apr. 6 - KGO - It's known as the Wal-Mart shopping spree scam, but Wal-Mart isn't really involved. Consumers sign up for huge discounts, but prosecutors say all they get is empty promises and a lighter wallet.

The suspected scam gets its name because a telemarketer tempts consumers with heavily discounted gift cards for major retailers and other businesses. Now the Federal Trade Commission is moving to shut the telemarketing company down.

Wilene Sanders, Hayward: "It makes me feel like a fool for one thing because I trusted them."

Wilene Sanders of Hayward still hurts from the phone call she received before Christmas.

Wilene Sanders: "It just seems like it's just a scam, you know."

She's out $298. The same thing happened to this Sunnyvale man. He's out $258.

Sam Sudarsanam, Sunnyvale: "I felt so upset by myself that signing up for this and I probably never do it again."

The Consumer Rewards Network near Los Angeles promised both of them $500 shopping sprees and discounts to entertainment venues like Six Flags. All this for just a $4.95 shipping and handling fee payable by check or debit.

They say once the company got their checking account information, it electronically debited money from their accounts without permission. Both are still waiting for their shopping sprees.

Pat Wallace of the Better Business Bureau says he's seen too much of this during his career.

Pat Wallace, Better Business Bureau: "It leaves me speechless sometimes but what I can't understand to some extent is why people fall for it because it's so obviously a phony situation."

The number of potential victims is staggering. The Better Business Bureau of Southern California received 1,400 complaints about the company. In fact, it's awarded Consumer Rewards Network its notorious Pluto Award.

The BBB says its award unceremoniously recognizes companies that use underhanded business practices and ambiguous advertising to augment their riches.

The Federal Trade Commission has also taken action and has won a temporary restraining order freezing the company's assets and ordering them to stop engaging in deceptive telemarketing practices.

We called the company for comment, but no one answers their phone. The BBB says the Consumer Rewards Network is also known by many other names including Mega Movie Club, Star Network and Health Network USA.

If you feel Consumer Rewards Network (or its affiliated companies) owes you money, you can add your name to the list of victims with the Federal Trade Commission.

Contact the FTC attorney on the case:

Send you name, address, phone number and details of your claim to:

Federal Trade Commission
Jennifer Brennan
Western Region Office
10877 Wilshire Blvd
Suite 700
Los Angeles , CA 90024

Additional company names for "Consumer Reward Network":


Health Network Unlimited
Auto Gold Consumer Reward
Net Forever
Health Network USA
Fun Pass
Star Communications
Family Fun
Family Fun Pass
Half Price TV
Fantastic Fun
Arch Communications
Mega Movie Club
Consumer Reward Network, Inc.
Star Network
Fantasy Vacations
Deluxe Holidays
All Star Access

Posted at FTC site

Amended Complaint and Preliminary Injunction in Premier Benefits Matter

Commission approval of amended complaint, entry of preliminary injunction, and appointment of a permanent receiver: The Commission announced today that it has filed an amended complaint in FTC v. Universal Premium Services, Inc., et al., currently pending against telemarketing company defendants Premier Benefits, Consumer Reward Network, Star Communications, Continuity Partners, Connect2USA, and the individuals who owned and operated them. According to the Commission, the defendants cold-called consumers falsely promising them valuable incentives such as gift cards, “shopping sprees,” movie passes, and gas vouchers for a nominal shipping and handling fee in order to get the consumers to disclose their bank account information. They then made unauthorized debits from the consumers’ accounts and harassed the consumers in an attempt to coerce them into paying additional charges for memberships in purported buying clubs. The FTC’s original complaint, filed in February 2006, resulted in a temporary restraining order against the defendants for their alleged participation in a “Wal-Mart Shopping Spree” scam.

Through the amended complaint, the FTC has added All Star Access, Inc.; Prime Time Ventures, Inc.; Merchant Risk Management, Inc.; and Pantel One Corporation as defendants involved in the deceptive and abusive telemarketing campaign. The amended complaint also names Christine MacGregor and her company Midwest Properties, Inc. as defendants, alleging that defendant Brian MacGregor fraudulently transferred his assets to Christine MacGregor and Midwest Properties, Inc., in violation of the Federal Debt Collection Procedures Act.

The FTC also announced today that its request for a preliminary injunction against the defendants in this matter and for the appointment of a permanent receiver over the corporate defendants and related entities has been granted, and was entered by the court on March 22, 2006.