Each month, BBB sends its secret shopper, “Sarah,” out into the marketplace to get the inside scoop on threats facing consumers. This month Sarah investigates some seemingly amazing offers for free groceries.

Type of Business: Consumer Research
Location: Bloomington, MN
Upfront Fee: $3.90 – $20.00
Claim: “GROCERY Stimulus Package helping people just like you!  Get $1000 Groceries!  Pay less than $20 – it’s true!  Limited Time offer – Call now!”

You may have seen this advertisement running in local newspapers or shopping guides. Consumers who call the toll free number are asked to answer a series of four questions covering their favorite shopping destinations, favorite restaurants to eat at, the amount of money they spend on groceries each month, and whether shopping habits have changed due to recent price increases.  Consumers are asked to pay $3.90 via credit card to cover shipping of a coupon packet.

When Sarah asked how the program works, the business stated they send $10,000 in coupons and she could choose $1,000 worth to use.  In actuality, the packet Sarah received from the business does not contain coupons, but instructions that directed her to a website.  At the site, she entered the login information supplied in the packet and was provided with a list of products that are marked as either free, half off, or price reduced.  Sarah was then instructed to check the box next to an item she wanted and type in the quantity she’d like to receive.  There is no number limit on any item; as explained by the business – “If someone eats a lot of hot dogs he/she could get $1,000 worth of hotdogs.”

So what’s the catch? Consumers who have participated in the “Grocery Stimulus Program” tell BBB that after they supplied their credit card information for shipping; their cards were charged several times without their knowledge, in amounts up to $89.  BBB suggests exercising extreme caution when dealing with any unknown company requesting an upfront fee for information.

With extra cash being so tough to come by these days, many consumers are looking to gold parties as a convenient way to make some money, but they may not provide you the best deal. BBB recommends consumers do their homework before selling their jewelry at gold parties.

Brett Sadovnick, owner of Tucson Coin and Autograph, told BBB he recently discovered that some hotel buyers offer far less than he and his local competitors, after he sent a gold chain he had purchased for $250 to several hotel buyers and the highest bid he received was $130.

“That’s beyond bad business practices; it’s stealing out of people’s pockets,” Sadovnick said. “Because they’re (consumers) desperate they don’t think clearly. People should always remember to shop it around before they settle on a buyer.”

BBB recommends keeping the following tips in mind when attending a gold selling party:

• Understand the scales.  The weight of gold helps determine its value.  If you measure your jewelry on a home kitchen or postal scale it is important to understand that jewelers use a different measurement standard called a Troy ounce.  A common U.S. scale will measure 28 grams per ounce, while gold is measured at 31.1 grams per Troy ounce.  To add to the confusion, some dealers will also use a system of weights called pennyweight (dwt) to measure a Troy ounce while others will use grams.  A pennyweight is the equivalent of 1.555 grams.  Consumers need to be alert that a dealer does not weigh their gold by pennyweight, but pay them by the gram.  This would allow the dealer to pay the seller less for more weight of gold.

• Know your Karats.  Pure gold is too soft to be practically used so it is combined with other metals to create durability and color.  The Federal Trade Commission requires that all jewelry sold in the United States describe a karat fineness of the alloy.  1 karat equals 1/24 of pure gold by weight. So 14 karats would mean the jewelry was 14 part gold and 10 part other metals.  It is illegal for jewelry to be labeled “gold jewelry” if it is less than 10 karats.  It is important to know the karats of your gold to make an informed decision on the scrap value of your jewelry.

• Combining karats. Don’t let jewelry of different karat value be weighed together.  Some dealers will weigh all jewelry together and pay you for the lowest karat value.  Separate your jewelry by karat value before attending a gold party.

• Call a local jewelry store or check with an online source, such as www.goldprice.org, to verify the current market price for gold before you sell.

“You can have fun and make some money at gold parties if you prepare in advance,” says Kim States, BBB President. “Weighing your gold with a jeweler and knowing your jewelry’s karat content before going to a gold party will help you understand the value of your items to assist with getting the best deal and avoid being ripped off.”

Consumers who have questions, or would like a report on specific gold buyers can contact their BBB at (520)888-5353, or visit www.tucson.bbb.org.

Better Business Bureau of Southern Arizona is alerting customers about ADK Marketing, a Phoenix-based door-to-door vacuum sales company that contacts consumers by phone to schedule in-home sales calls.

In the past couple days we’ve been contacted by four Sierra Vista consumers who received phone calls from ADK Marketing offering them two rooms of free carpet cleaning in their houses. These consumers said they had no idea the company is actually selling vacuums.

When consumers’ asked ADK Marketing how they obtained their phone numbers, the company said they had entered and won a sweepstakes. Consumers say they have no recollection of entering a sweepstakes.

ADK Marketing also does business under the name All Generations, and is owned by Cameron McDaniel. BBB Serving Central, Northern and Western Arizona maintains separate reliability reports for ADK Marketing and All Generations. On a scale of A+ to F, ADK Marketing has a B- rating with that BBB and All Generations has and F.

In 2004, McDaniel was the defendant in a lawsuit brought against him by the Arizona Attorney General’s Office that alleged All Generations gained access to consumers’ homes by contacting them via telephone claiming the consumer had won $1,000 worth of groceries and also qualified for a demonstration of a carpet cleaning method. The Attorney General’s Office says consumers were offered free carpet cleaning in return for their “opinions.” The lawsuit also claimed All Generations falsely implied they were not selling a product.

BBB Tips:

• If you are contacted by phone with an offer that is too good to be true, it probably is.
• If you do not know the caller or the company, get as much information as you can and check them out with BBB, www.sierravista.bbb.org or call 520-732-9823.
• If contacted by a pushy telemarketer don’t be afraid to hang-up the phone or asked to be removed from their list
• If you don’t wish to receive unsolicited sales calls, register your phone number with the National Do Not Call Registry by visiting www.donotcall.gov or calling 888-382-1222.