With many people staying at home due to COVID-19 and spending more time on the internet, chances are they will encounter bogus “free trial offer” scams. While celebrities, credit card companies and government agencies have increased their efforts to fight deceptive free trial offer scams, victims continue to lose millions of dollars to fraudsters after the release of a December 2018 Better Business Bureau (BBB) study about the shady practices.

“Subscription Traps and Deceptive Free Trials Scam Millions with Misleading Ads and Fake Celebrity Endorsements,” describes how free trial offers often use celebrity endorsement ads on social media and the internet to attract consumers to deceptive websites that charge a small shipping and handling fee, usually $4.99 or less, for a “free” trial of beauty or health products like skin creams or weight loss pills. The true cost of these free trials — ongoing monthly subscription plans — is buried in small print and behind links, if disclosed at all.

Free trial offers are not illegal. Video streaming services often offer free trial offers.

Sandra Bullock

Scammers now are using free trial offers to take advantage of the desire for streaming services. BBB has received Scam Tracker reports that scammers are using social media to offer bogus free Netflix services. To receive a fake pass, those clicking on a link may be directed to provide personal information and send the offer to friends. Scammers are likely phishing for personal and banking information or to distribute malware.

BBB urges consumers to:
• Examine online free trial offers carefully
• Resist being swayed by the phony use of a well-known name
• Report free trial offer scams to BBB Scam Tracker
• Report losses to credit card companies. After the BBB free trial offer study, Mastercard and Visa issued new policies to increase transparency for free trial offers. Victims should call the customer service number on the back of the credit card used to ask for their money back.

Free Trial Complaint Trends
Although complaints to the FBI’s Internet Crime Complaint Center (IC3) decreased somewhat in 2019, free trial complaints and reports to BBB for the U.S. and Canada increased. Since many victims don’t complain to BBB or to law enforcement, these numbers represent a trend rather than the total size of the problem.

Free Trial Scams Reported to BBB
Consumers filed more than 58,400 complaints and Scam Tracker reports to BBB in the U.S. and Canada in the last three years. The median loss for victims dropped from $186 to $140 since the study.

FBI Complaints Regarding Free Trial Scams
Complaints to the FBI’s Internet Crime Complaint Center (IC3) slightly decreased in 2019.
IC3 found that the largest number of victims were over 60.

New Scam Tactics
Free trial offer fraudsters have developed new tactics. Previously, they usually sent shoppers to bogus generic consumer news articles or fake websites with familiar sounding names to make their pitch. Now they often copy the look of major media outlet websites, such as The Today Show, Good Morning America, and others, presumably to increase the credibility of the claims about the products.

Scammers also have expanded their efforts to use social media to draw in victims. An October 2019 investigation by Buzzfeed details one operation based in San Diego that convinced people to rent out their personal Facebook accounts to the fraudsters who used the accounts to place free trial offer ads. According to Buzzfeed, scammers used “overseas workers in the Philippines to manage its account rentals and legions of associated Facebook pages, and built up a network of stay-at-home moms in the US to recruit friends and family members to rent their accounts.”

Celebrity Efforts To Combat
The fraudulent use of well-known names, images and made-up quotes not only deceives and lures consumers into making purchases but, also potentially damages the reputation of trusted celebrities.

Some celebrities have been vocal about not endorsing such products. Tom Hanks warned about a CBD product that illegally claimed his support. Shark Tank and other celebs urged fans to closely examine ads using their likeness to avoid being scammed. Ellen DeGeneres and Sandra Bullock sued a free trial offer operation that changed names frequently as it continued to use their names and likenesses without permission.

Celebrity endorsement theft has also targeted international personalities. Online ads falsely claim a skin care cream endorsement by Mary Berry, host of The Great British Baking Show. She has spoken out against this tactic.

Law Enforcement Efforts
The study noted that while the FTC and BBB had done much to address the issue, only criminal prosecutions and international cooperation were likely to deter this type of fraud. Several actions have since happened.

23 state attorneys general have urged the Federal Trade Commission (FTC) to strengthen regulations to combat free trial offer scams.

FTC cases reported more than $1.3 billion in documented losses in the December 2018 BBB study. That total has risen to nearly $1.4 billion, thanks to settlements in the FTC’s cases against Apex Capital Group ($47.3 million) and Triangle Media Corp ($48.1 million).

In addition, the FTC amended the complaint in its Apex Capital Group case to add a Latviabased payment processor as a defendant. Though the original defendants in that case have settled, this litigation continues.

The FTC has filed two new cases against an enterprise operating from Puerto Rico and AH Media. Both are in litigation.

In April 2020 the FTC issued full refunds to victims in a free trial offer case where the company was selling golf and kitchen gadgets.

The owner of the Puerto Rican operation has also been charged criminally in the District of Puerto Rico.

In March 2020 the Florida Attorney General obtained an Assurance of Voluntary Compliance with a Florida-based operation that shipped products for a number of free trial offer scams.

At least one class action case federal court challenges the tactics of another free trial offer scam and cites the BBB’s study as support.

Credit Card Company Efforts
Credit cards continue to be scammers’ payment method of choice for free trial offer scams.

BBB urged credit card companies to do more to ensure victims receive chargebacks where key conditions are not adequately disclosed.

Since BBB’s study, Mastercard and Visa have announced new policies to combat free trial offer scams. Mastercard now requires merchants to get cardholder approval before billing after the conclusion of the trial. They also must provide receipts, contact and cancellation information. Visa adopted similar requirements that became effective on April 18, 2020.

Both companies continue to encourage victims to dispute questionable charges with the bank that issued their card.

Education and media
Consumer education and awareness can help people avoid free trial offer scams. Media coverage resulting from the study includes ABC’s Good Morning America, NBC News, CBS News This Morning and Consumer Reports.

Those who have lost money to deceptive free trials need to challenge the charges on their credit cards and file complaints so they can educate others.

• Complain to the company directly. If that is not successful, call the customer service number on the back of your credit card to complain to the bank.
• Report suspicious, confusing or misleading ads to BBB AdTruth at bbb.org/ad-truth.
• File a complaint about free trial offers with:

BBB — bbb.org or bbb.org/scamtracker
Federal Trade Commission — ftc.gov or 877-FTC-Help
FBI Internet Crime Complaint Center — ic3.gov
Canadian Anti-Fraud Centre — antifraudcentre-centreantifraude.ca or 1-888-495-8501 toll free from the US.
Competition Bureau (Canada) — http://www.competitionbureau.gc.ca