We’ve said it a thousand times: scammers are the worst, and those that take advantage of organizations trying to do good in the world are the lowest of the low. Such was allegedly the case for Liberty Supply Co., which federal regulators have accused of running an office supply scam that targeted charitable organizations and small businesses.
The Federal Trade Commission today announced that, at its request, a federal court temporarily halted and froze the assets of Liberty Supply Co. after the operation allegedly bilked millions from nonprofit organizations and small businesses.
According to the FTC’s complaint [PDF], since at least 2012 the operation, which did business as Omni Services, initiated calls to churches, schools and businesses.
Operators for Omni claimed they worked for a local company that was going out of business, and offered to sell pens, paper clips, and other office supplies at low prices.
When describing their sales offer to consumers, Omni’s telemarketers typically used vague or confusing terms about the cost or quantity of goods offered.
For example, the FTC claims the company quoted a per-unit price even though they only sold multi-unit quantities, causing consumers to believe the quoted price applied to a package of items, instead of an individual item.
As a result, the company failed to disclose the final price, quantity or shipping cost, even when asked, according to the FTC complaint.
In one instance, the complaint alleges that if a consumer asked for a purchase order for their organization to approve, instead of sending a purchase order the defendants sent unordered merchandise and an invoice.
Once a company received the unordered office supplies, Omni aggressively sought payment for the merchandise.
Consumers who paid the invoice in full received a “thank you” call from Omni and the offer of a free gift. When the gift arrived it came with even more unordered office supplies and a new invoice.
The FTC claims that when consumers questioned the invoices, Omni allegedly said they had a transcript of the conversation in which the order was placed, but refused to produce the transcript to the customer.
When businesses or organizations asked to return the unordered merchandise they were told they had to pay a restocking fee, about 15% of the invoice amount.
Some consumers paid for the products in order to avoid the burden or expense of the defendants’ onerous return policy, but the prices they paid were typically higher than the amount the defendants had stated in their initial phone call.
In all, the FTC accuses Liberty Supply Co. and its operators, Mia McCrary and John B. Hart, of violating the FTC Act, the Telemarketing Sales Rule, and the Unordered Merchandise Statute.
The FTC is seeking to permanently stop Liberty Supply’s alleged illegal practices and make the company refund affected customers.
by Ashlee Kieler via Consumerist
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