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Attorney General Announces $30 Million Multistate Settlement With Discount Club Marketer For Deceptive Advertising And Enrollment

CONTACT: Elliot Burg, Assistant Attorney General, (802) 828-5507

October 10, 2013

Connecticut-based Affinion Group, Inc., and its subsidiaries Trilegiant Corporation and Webloyalty.com, Inc., will pay over $30 million to 46 states and the District of Columbia to settle allegations that they misled consumers into signing up and paying for memberships in “discount clubs.” According to Vermont Attorney General William H. Sorrell, Vermont will receive $720,000 for its role in investigating and resolving the case, and Vermont consumers who were billed by the settling companies may be eligible for up to an estimated $360,000 in refunds. The settlement will “bring to an end practices that for years deceived Vermonters and led to surprise charges on their credit card accounts,” said Sorrell.

Affinion runs discount club programs involving services such as credit monitoring, roadside assistance, and discounted travel. The programs are offered through “marketing partners,” usually well-known banks and retailers. Affinion billed consumers’ credit cards or bank accounts, imposing charges that continued until the consumer affirmatively canceled (which would now violate Vermont law).

Consumers complained that Affinion charged them for club memberships without their authorization or knowledge. Consumers were also confused by the fact that the offers looked like they came from the marketing partners, not Affinion.

The states’ investigation, which Vermont helped to lead, found that Affinion failed to adequately disclose its identity and the cost and ongoing nature of the charges. The investigation also uncovered two deceptive marketing practices—“live checks” and “online data pass.” In live check solicitations, consumers were sent a check by mail. Many consumers cashed the checks without realizing that their endorsement authorized Affinion to enroll them in a discount club and to bill them each month indefinitely. In online data pass, an Affinion offer appeared on consumers’ computer screens right after an online purchase from a retailer; Affinion then enrolled and billed the consumers without having to ask for their credit card or bank account information because the marketing partner had passed that information on to Affinion. As part of today’s settlement, both practices are prohibited.

The settlement also requires Affinion to provide clear and conspicuous membership information to consumers after enrollment, to send periodic reminders of their enrollment, and to improve cancellation policies.

Consumers who think they may have been billed for a discount club membership should check their credit card and bank account statements—going back to 2008 or before—for the name of any of over 200 Affinion membership programs (with names like “AutoVantage” and “Bonus Pack”), a list of which can be found here. Anyone who was charged and who has already filed a complaint with the Attorney General’s Office need not do so again. Anyone who was charged but has not filed such a complaint should complete an online form, or call the Attorney General’s Consumer Assistance Program at 1-800-649-2424; an eligibility determination will be made based on the information provided.

For more information on the settlement, call the Vermont Attorney General’s Office at (802) 828-5507.

  Website consulting provided by The National Association of Attorneys General.