The Better Business Bureau (BBB) is a scam, and hundreds of thousands of unfairly targeted small business owners have known it for years. Now, new publicly available evidence confirms that suspicion for the rest of the world, too.
The original “complaint forum”, the BBB has long represented itself as the impartial moderator of business disputes. Consumers with complaints about businesses would lodge their complaints with the BBB, and the BBB would send a letter to the business. If the targeted business responded to BBB’s satisfaction, then no damaging report would be made. But if the BBB was dissatisfied with the targeted business’s response, BBB would gladly provide that information to anyone who asked for it, and attach a rating of “A” through “F” depending on BBB’s own biases.
Many businesses live or die on their BBB rating. This is ridiculous, since the BBB has no actual authority whatsoever. Yet, for some reason, the public has long considered the BBB to be a reliable indicator of the experiences of the public with particular companies.
Now, the truth – long suspected by so many small businesses – is out. According to Connecticut Attorney General Richard Blumenthal [1], the BBB’s rating system (“A” through “F”, like a report card) can be manipulated by offering financial incentives directly to the BBB.
Example: One small company – Bayless Custom Homes – had an “F” rating with the BBB. Owner Gary Bayless had never been informed of the one complaint that led to the rating. Bayless says he contacted the BBB about the issue, and they agreed to change the grade to B+, or to an “A” if Bayless would join the BBB organization, which includes the requirement that Bayless pay the BBB.
Example #2: Deciding to test the theory of BBB irrelevancy, some L.A. business owners created a fake business name – Hamas, after the terrorist organization – and submitted a membership application to BBB [2]. This fake business doesn’t exist and has never done business. Yet the BBB saw fit to give it a rating of “A-” with no more justification than the $425 application fee.
Note that the problem is not ONLY that the BBB is exchanging “good” grades for money. The bigger issue is that anyone trusts this utterly irrelevant organization to begin with. Bayless’ example is instructional there as well: The BBB targeted Bayless’ company and exerted undue and unwarranted negative influence over him without so much as a notification that they’d chosen to accept some random complaint against him. They then offered to accept what I believe is a tantamount to a bribe to remove their bogus negative rating that never should have existed to begin with.
The Better Business Bureau is an irrelevant, antiquated and probably fraudulent organization. It’s time that the BBB gets an F rating.
[1] http://www.kltv.com/Global/story.asp?S=13494782
[2] http://slatest.slate.com/id/2274821/
The negative image of the BBB is simply a result of a bad economy. The BBB is hiring individuals that lack respect and integrity for both the BBB and business owners.
If you put an unqualified sales person behind a desk and offer the employee commission to sale your product, then you will get positive sales and negative results.
BBB, hire qualified individuals and pay your consultants a reasonable base salary.
i wish i had known that a long time ago now i know why companies i ve complained about didnt bother to respond . the bbb.has done a great injustice to the consumer who relied on them to be our watch dog
I disagree with Rita. There’s been a long history of the BBB disregarding the rights of small business and using their contrived role as a “watchdog” to essentially extort small business people into behaving as the BBB wants. I’m glad that more people know how thoroughly illegitimate they are.
Good article – Old News,
I have know the BBB is a money making scheme and nothing more for years. Try submitting a complaint to them against a non-member, and then a member. It is a waste of time in both cases. I have known this about the BBB for years.
Bryan, dead on. Great piece. As a small business owner, I learned decades ago the BBB is a sham. Smoke and mirrors. Unfortunately they have never been exposed to the public in any major way, and the uninformed think they are credible.
Hello Bryan, the economie crushed, the real estate went south, the financial institution Fanny Mae and Freddy Mac bailed out so the BBB corrupted need money to give you an a favour A. well the list is not going to stop right there.zee
I have been following closely these complaints with much interest. For three years now I have filed many written complaints against primarily Chris Coleman, the so called President/CEO of the Better Business Bureau in Des Moines Iowa for a period of nearly three years regarding a variety of issues, but numerous ones that relate to much of what your story covers.
After three years of being unable to get my complaint heard and better yet action taken, on October 4, 2010 I sent a very detailed letter containing over 50 attached documents of support to Mr. Stephen Cox, President of the Council of the Better Business Bureau’s in Arlington Virginia.
Twenty two days later, I received a canned reply advising the information was received and sent on to the Chris Coleman in Des Moines Iowa for handling and advise I could expect a response within another 30 days. Basically I will wait fifty two days for the first response from the man that failed to respond effectively for three years.
Immediately I sent another message reminding that they (BBB) require businesses to respond within ten days receipt of a consumer complaint.
I now have been waiting for a total of forth three days without a response.
All the while, I have had a grossly incorrect grade (F) on the BBB website and every day my business is being damaged because of Mr. Coleman’s documented vendetta against my company.
Just for the record, Mr. Coleman was accused of sexually assaulting a former employee, questioned about his self beneficial unethical behavior by the City of Des Moines, for which he serves as a councilman.
I truly believe there needs to be a governing body closely watching this organization. I cannot be the Federal Trade Commission or the State’s Attorney General because I also filed my complaint with them and hever heard from the FTC, and the AG’s office told me to get a lawyer. This is America and no one should have the authority to single handedly make decisions to deliberately damage another’s business first with out an investigation and without the proof. That person or persons should also have a credible background.
A local business owner I knew did his research in regards to BBB Membership and stated that the BBB was started by mobster Al Capone as extortion/protection racket.
Can anyone confirm this?
Sounds like extortion to me.
I’ve known for some time that the BBB was a fraud and it’s high time that the truth has finally come out. Now the public will have to take the time and learn to do some real due diligence on companies without depending on the fraudulent BBB.
I also disagree with Rita. The BBB has proven themselves to be a fraud as long as you pay their fee you will get an A rating. That so sucks.
Great Article Bryan. This was an eye opener for me, but it makes perfect sense to me in retrospect. I’ve filed a few complaints with them in recent months that never went anywhere and now I understand why.
Cheers
Dr. John Michael Christian
Sounds like BBB needs a Czar to watch over them.
yeah,i checked out a company call National Grants and they had an A rating so I gave them $1,500 I got scammed and I know people who got scammed out of $30,000 or $50,000.The company just closes down opens up with a new name and a new A rating with the BBB.
This is Bull Sh*** I think the BBB should be responsable for my $1,500 since I based some my making a decision on the A rating the bbb gave them.
Daniel
That’s very true. Another corporate scam! I wonder why those big news channels don’t make big fuss about it. IMHO they should.
I have also known BBB was a scam. I filed a complaint against Amazon, whobasically answered with a non letter. Amazons answer to my complain was basically, sorry, thats our policy.
BBB asked if i was satisfied with the replay from amazon
I answered no, how can i be satisfied,they didnt say anything. So they forward my complaint again to amazon which again said, sorry, thats our policy
Then the BBB said, sorry, in our view amazon has answered your complaint satisfacterly, and that was the end of it. Clearly there was no real human intervention looking into my complain, the excersise was a waste of time and an excercise in futility
Imagine BBB is getting tax money for this stupidity
My company was a vendor for the BBB office in Miami, Florida. Every month they were late submitting payment to us. The office was closed and we were out the $3,500 that was owed to us. A call to the home office resulted in a response that each location was responsible for their own bills and that the home office would not pay us. The BBB gets an FFF rating.
I filed a complaint against a so called company named REO DIRECT PARTNERS and they are a scam that prides itself on ripping off realtors of $275 – $400 for a so called REO account. They robbed me of $275 and said that they would set up an account and give me a log in ID and would begin receiving REO accounts shortly. Well, I never received a log in ID and less any REO accounts. I immediately contacted the BBB of Chicago and they said they would investigate the matter by sending a letter to the company. The company responded by saying that I needed to try the service for 12 months and if I was not satisfied, I could then request a refund. I advised the BBB that this company was a scam and that they would soon shut down and re open as a new company again and the BBB’s response was that the company’s response was satisfactory and case was closed. WELL, This week marks the 12th month and I contacted the company REO DIRECT PARTNERS only to find out that the phone was disconnected and the company no longer in business. If anyone has considered doing business with any of these scams PLEASE think twice about any company that requests payment up front for services not rendered. Their so called senior ASSet manager VINCE ROTHSTEIN is a spineless COWARD and he will answer one day for his evil deeds to the one and only Jesus Christ!! Anyone interested, I think we all who have posted a comment need to exchange information and file a class action lawsuit against the BBB instead of just blowing off steam, LET’S DO SOMETHING ABOUT IT!!! my contact: mmoreno@kw.com
We received a phone call from the Raleigh BBB asking us if we wanted to resolve a complaint made by a consumer. We were informed that in order to guarantee “resolve” in the matter we would need to write a check to the local BBB for $600.00. Essentially attempting to extort money from our business.
They explained that they had mailed two complaint letters, we received one AFTER they called us, that we had limited time to adhere to their complaint schedule; in other words send them money now. I explained to them that I would review the compliant and contact them back, after reviewing what they initially put online we determined that the customer, WHO WOULD NOT REVEAL THEIR REAL NAME, was a person who had in fact ripped our company off.
This customer thought he knew what was wrong with his boat and insisted he was right, even though he could not fix it himself; to the point of claiming we were even trying to rip him off. He had an electrical issue that required swapping out most of the system (battery, plugs, cables, starter, wires) to find the problem. He wrote us a check, while not complaining about anything and picked up his jetski then canceled the check. He has never returned any of the seven phone calls made to him by us about the matter. Which we have informed the police about.
After filing a complaint with the BBB and of course not bothering to contact us, as we apparently don’t know what we are doing, according to him; he them canceled his personal check to us and refuses to clear his complaint with the BBB even though he received free service and parts, which he also refuses to return. The Wake County Sheriff’s office has told us that after we file a civil complaint and win a judgment they would then charge him with felony theft. Unfortunately for us as a small business that customer’s $573.00 bill is simply not worth the day in court and one thousand dollar filing fee charged by Wake County. This is one of the many reasons why dealerships and honest service shops will not bother with mobile service, there is no automatic lien placed on the property enforceable in court without a civil suit process. Our company lost more than $170.00′s in parts cost, which the BBB refuses to acknowledge since we refuse to pay them their extortion fee. I have gone as far as threatening to contact the local police and record their phone calls next time they decide to allow someone with no evidence to libel us online and then extort money from our business. Consequently, the Raleigh BBB gave our company an F rating and wrote three of their own bad reviews about us, because we would not pay them to remove the original complaint.
We have had/handled 15 serious customer complaints in seven years of doing business out of more than three thousand service jobs performed(and we can back that up with documentation in court). Out of the total available market in Wake County we are currently servicing 5% annually and have a referral rate of 20% meaning that 1 in five customers has been referred by an existing customer. Other than a phone book listing Dave’s Marine Services spends no money on advertising.