PORTLAND, Ore.— Anji Gardner doesn’t have any subscriptions. She doesn’t read magazines. So when a $946 bill arrived in the mail demanding payment for magazines, the Eagle Creek woman didn’t know what to do.
“Who in their right mind would order that many magazines?” asked Gardner. “Not me!”
The letter from Interstate Recovery Service had bold print and demanded payment in full.
“I was scared to death. My heart sunk to my gut,” said Gardner.
Gardner called the collection company based in Virginia Beach, Virginia. An operator with Interstate Recovery Service was adamant that she’d ordered the magazines from a company called “Magazine Distributors” and she needed to pay.
“He said he had a recording of me stating that I ordered the magazines, but he wouldn’t play it for me,” explained Gardner.
Frustrated and confused, Gardner gave the collection company her credit card number. She agreed to pay a settlement of $635 in monthly installments.
“I didn’t know what to do,” said Gardner, who felt intimidated by the high-pressure operator.
After making a payment, Gardner decided to do some sleuthing of her own. She contacted “Magazine Distributors” (aka Hudson News Distributors), which confirmed she didn’t owe any money.
“Magazine Distributors has not been in operation since June of 2010 nor has this company contracted with Interstate Recovery Service to collect any funds from you or settle an account with you for $635.00,” read a letter sent to Gardner from Rosemary Niola, human resource administrator with Hudson News Distributors.
Gardner contacted her bank and canceled payment to Interstate Recovery Service.
“I’m done. I’m not playing their game,” said Gardner.
A review of government records show that 28 consumer complaints have been filed against Interstate Recovery Service with the Consumer Financial Protection Bureau. Many of the complaints are similar. Consumers report the collection agency is demanding payment for magazines they didn’t subscribe to and never received.
KGW spoke with representatives from Interstate Recovery Service on two separate occasions seeking a response to consumer complaints. One employee explained the business owner, William Stemple, was on vacation in Mexico. He could not be reached for comment.
State records show Interstate Recovery Service has filed the necessary paperwork to operate in Oregon.
The Better Business Bureau gives the Virginia-based company an A+ rating, even though the collection agency recorded 32 consumer complaints with the BBB in the last three years.
“We are a legitimate collection agency and that we are not in cahoots with anyone, nor are we involved in a scam,” wrote Interstate Recovery in response to one complaint posted on the BBB website.
The BBB defended the A+ rating, citing a mathematical equation based on 13 factors.
“Interstate Recovery is a rather large collection agency,” wrote Jamie Howell, spokesperson for the BBB in southeast Virginia in an email to KGW. “With that being said, the threshold/ratio of complaints vs. size is somewhat a factor in the grading system. The fact they are very responsive to our efforts in resolving those complaints is a factor as well.”
Complaints about magazine subscription services are not unusual.
The Federal Trade Commission provided these tips for consumers to avoid issues:
- Listen carefully to sales pitches for magazine subscription deals. They could be from unscrupulous con artists who want to trick you into paying hundreds of dollars for multi-year subscriptions.
- Ask questions to make sure you understand the deal.
- If you’re not interested tell the caller to put you down on a "do not call" list. If they continue to call, hang up. They’re breaking the law.
- Ask for -- and read -- a written copy of the contract before you agree to buy.
- Do the math. You could end up paying hundreds of dollars for subscriptions that sell elsewhere for less.
- Keep information about your bank accounts and credit cards to yourself unless you know who you’re dealing with. If you give an account number to a stranger over the phone, it could be used to debit your account without your permission.
- Be skeptical if someone tries to sell you a "bargain," offers you something for "free" or pressures you into a decision because the offer is good for a "limited time" only.
Have a tip? Email email@example.com.