What’s more, says the FTC, these text messages — offering “free” gift cards to recipients — linked to scammy websites where some people say they were deceived into providing their personal and financial information to pay for subscription services.
The not-at-all free gift cards advertised in these texts were allegedly for major retail stores — Best Buy, Target, Walmart, among others — and were purportedly worth upwards of $1,000 each.
“When consumers followed the links included in the unwanted messages, they were directed to sites that collected a substantial amount of personal information, including in some instances health information, before being allowed to continue toward receiving the supposed gift cards,” writes the FTC in a statement. “In many cases, the information was requested under the guise of being shipping information for the supposed gift cards.”
According to the FTC complaints, this information sold off to third-party marketers.
But the scammers weren’t done. Once consumers entered this personal information, they were sent to yet another site, where they were informed that they needed to participate in a number of “offers” to be eligible for the gift card that had been used to lure them into this mess.
“In some cases, consumers were obligated to sign up for as many as 13 of the offers,” says the FTC. “These offers frequently included recurring subscriptions for which consumers were required to provide credit card information. In other cases, they required consumers to submit applications for credit that would be reflected in their credit reports and possibly affect their credit score.”
But wait — it’s not done.
Once the consumer had completed all the offers required to get the gift card, they were then told they would need to rope three other people into complete similar offers before they could actually receive their not-in-anyway-imaginable-free card.
The FTC says this violates the FTC Act by failing to tell consumers about all the conditions attached to the “free” gift, including the possibility that consumers would actually be required to spend money to receive the gift.
“Today’s announcement says ‘game over’ to the major league scam artists behind millions of spam texts,” said Charles A. Harwood, Acting Director of the FTC’s Bureau of Consumer Protection. “The FTC is committed to rooting out this deception and stopping it. For consumers who find spam texts on their phones, delete them, immediately. The offers are, in a word, garbage.”
One of the 29 defendants in these cases had been previously barred from sending spam text messages in 2011. The FTC is pursuing a separate contempt action this delightful fella.