Van Nuys, CA, May 4th, 2010: WASHINGTON, D.C.—Senator John D. (Jay) Rockefeller IV, Chairman of the U.S. Senate Committee on Commerce, Science, and Transportation, issued the following statement after Visa Inc. announced it will change its merchants' regulations to prohibit "data pass" marketing:
"Visa's decision to prohibit 'data pass' marketing is a direct result of the committee's investigation and a win for American consumers," said Chairman Rockefeller. "As I have said before, tricking consumers into buying goods and services they do not want is completely unacceptable. It's not ethical, it's not right, and it is not the way business should be done in America. While I am pleased that Visa is changing its rules so that more consumers are protected, I still believe that legislation is needed to ban this deceptive practice once and for all. In the coming weeks, I intend to introduce legislation that will address the concerns raised by the committee's e-commerce investigation."
"Data pass" marketing has been the focus of a Commerce Committee investigation since May 2009. The practice usually involves a consumer shopping at a familiar e-retailer's website. Immediately following checkout, an offer for a discount or reward that appears to be from the familiar e-retailer is presented to the consumer. If the consumer accepts the discount or offer, the consumer is signed up for a service from a different merchant, and is charged recurring fees. Because the first merchant has "passed" the card information to a second merchant, the cardholder is often unaware that there will be charges until unfamiliar transactions appear on their monthly statement.
In November 2009, the committee held a hearing and released a staff report, which showed that three companies—Affinion, Vertrue, and Webloyalty—had enrolled millions of online consumers in membership programs using "data pass" marketing. The Commerce Committee investigation found that "data pass" marketing had bilked 35 million consumers out of more than one billion dollars.
In December 2009, Chairman Rockefeller sent a request for information to Visa about the aggressive sales tactics the committee had uncovered in order to gain a better understanding of Visa's awareness of the problem.
Visa's changes will go into effect on May 1, 2010.
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Los Angeles, CA-based Moulton Logistics Management is one of the leading providers of state-of-the-art order fulfillment, call center and integrated logistics services to direct response, retail and multi-channel merchants. For over 40 years Moulton has been delivering turnkey, technology optimized services and solutions and now offers its award winning SaaS, web based platform DRTV Marketer Pro software suite that provides Moulton clients with real time visibility, integrated reporting and decision support tools for managing sales campaign activity, fulfillment and call center services, supply chain and inventory pipelines.
