Re: Broadview Still Paying Off the BBB

[Jim Rojas <jrojas@xxxxxxxxxxxx>]

Why does this not the least bit surprised me?

Read below.

Jim Rojas

<< snipped from: http://www.thebluesmokeband.com/bbb.php >>

The Better Business Bureau:
It's not what you think!

Living a dream, I recently filed a "Fictitious Business Name" with
Riverside County in California. This is public information, much like
getting a mortgage and transfer of property title. In one sense, this
simply means that you get a lot of telemarketing calls. This is all fine
and dandy ? in fact, the fact that there is a wealth of public
information out there is somewhat comforting.

Enter The Better Business Bureau. Until last week, I thought that the
BBB was a government-run organization, funded by my tax dollars. I
thought that it was a neutral observer of business standards and
practices, a place where one could get information on a legitimate
business or where one could lodge a formal complaint against a shady
one. Just about none of this is true.

The BBB is not run by the government, but they do a lot of business with
the FTC ? at least that's what I hear. They are a non-profit, charity
organization known as a 501(c)(3). This means that whatever money you
donate to their cause is tax-deductible. The money that you donate is
supposed to go into programs and charitable causes. The organization is
supposed to report their income, report their board of directors, report
about their programs, and so on. This information appears on IRS form 990.

990s are public information. So, with my wife's help, I got hold of the
990 for our local BBB. Turns out, they report no income, no board of
directors, no contractors who earn over $50,000 per year, and they have
no programs. All they appear to have is -$849 in assets. This is, to say
the least, shady.

You might ask, "Why is he so interested in the BBB?"

They cold called me. Mind you, this was back when (last week) I thought
that they were a legitimate organization. It went something like this:

The "Guy" called and said that he was from the Better Business Bureau.
My ears perked up: I thought either I have already done something wrong
(!), or that they are a really conscientious organization interested in
how I conduct my affairs. He said that he wanted to set up an
appointment to visit my business. When I balked, he said that he could
just ask me some questions over the phone. So I assented.

He asked questions that were already answered on the county DBA filing,
so I answered diligently, thinking that he was probably checking up on
me to verify if I had been honest on the DBA application. He finished
his simple questions (e.g., do you have employees? How long have you
been in business? What is the nature of the business?), and told me:

It costs $465 a year and that will carry you through June 2006. We take
credit cards or check by phone.

I was floored. The "Guy" cold-called me and thought that I'd start
doling out credit card numbers? Insane. I asked him, "Excuse me, you
can't bill?" He answered, "We do credit cards or check by phone." Wary
of phishing schemes, I told him that I had no way to know that he was
who he claimed to be and that he would have to give me his information
and I would call back if I was interested.

He gave me the information, and there started the investigation.

There are a lot of problems, right from the start ? even before you
start reading the complaints against the BBB.

Most importantly, there is the obvious conflict-of-interest problem.
They take "subscription" or "membership" donations from businesses. This
means that businesses are the BBB's source of income (even though they
don't report income). But businesses are their object of complaint. So,
if I as a consumer complain to the BBB, I'm complaining about one of
their sources of income. Obviously, this is a problem.

The problems run deeper. An hour or so after they talked to me, my
business appeared on their web site (if you're interested, find the
Southern California BBB site and look for "Bluewood Designs"; I resist
linking to them). The information on the site is the information that I
told them over the phone.

They never confirmed that information. Furthermore, they assigned me a
"BB" rating. This means, paraphrased, that they have no reason to
believe that anyone would have trouble doing business with me. This is
true, to some extent ? they have no reason to think much of anything
about me because, well, they know virtually nothing about me.

What's curious is that many other local businesses, who are members of
the BBB, have "A" or higher ratings. Hmmm. I wonder what my rating would
be if I paid for a "membership".

More curious, and again I encourage anyone to look this stuff up, I
checked out the local Wal-Mart: they are a "member" of the BBB. They
have had one complaint against them, but it apparently was resolved. So,
they have an "AA" rating. I checked out the local Lowe's. They have 14
unresolved complaints against them and have an "F" rating. They are not
members of the BBB.

What makes this case curious, in my estimation, is the number of lodged
complaints. These stores are no more than a couple of miles from each
other and so have basically the same customer base. I find it impossible
to believe that the BBB has only received one complaint against Wal-Mart
and 14 against Lowe's. This makes me suspect that a) the BBB is not
recording complaints against their members; b) the BBB is not recording
responses from non-members; c) the BBB might be "creating" complaints
against non-members. Or some combination of these or others.

That last point is one that I've now read about (check out
badbusinessbureau.com for more). Somehow this doesn't seem unreasonable
? I consider how much due diligence the BBB did to get my business
information. I imagine that they do similar diligence on complaints that
they receive.

Speaking of how complaints go, a friend of mine, let's call him "Scott",
lodged a complaint with the BBB against a local car dealership. The
dealership had tried to make him replace a $500 part on his car when it
was really just a fuse that had blown. That complaint, on the BBB web
site, is listed as resolved. This is probably because "Scott" grew tired
of the paperwork and didn't pursue the complaint further. The BBB let it
end. The car dealership is a member of the BBB. They have a "B" rating
and 14 complaints.

But Scott felt that he had lodged a complaint with a reputable
organization and that something might be done about their business
practices. This is not the case, for the BBB has no authority over
businesses and no significant legal influence with state or county
authorities. Yet arguably, they market themselves as having that kind of
authority.

This succeeds to dupe consumers into thinking that their complaints will
actually be heard by someone who can or will do something about it. In
the case of my friend, this stopped him from taking the complaint to an
authority, such as the state Attorney General.

There are numerous other resources and anecdotes about the BBB out there
on the web. This article aims only to raise a healthy suspicion about
the organization and to encourage business owners and consumers to
proceed with caution when doing business with the Better Business Bureau.

One final irony: if you have a complaint against the Better Business
Bureau, you can't file it with the Better Business Bureau. And just as
Groucho Marx once quipped that he would never join a club that would
have him as a member, the Better Business Bureau is not a member of its
own organization.

Maybe it's all a big joke?

© 2005 Sorrell