Peel Inc., Accused of Free Trial Scam, Shut Down by Illinois Attorney General

credit card bills - Peel inc.A notorious online marketing scam that billed the credit and debit cards of thousands of unsuspecting consumers without their approval has been shut down by Illinois Attorney General Lisa Madigan.

The company, Peel Inc., was sued by Madigan in February 2010, for "cramming" consumers' credit cards with unauthorized charges for supposedly "free trial" offers for a range of products, including coffee, posters and jewelry.

Cramming involves the intentional insertion of unauthorized, misleading or deceptive charges, and as Consumer Ally recently reported, the Senate Commerce Committee is investigating cramming on phone bills by major telecommunications companies."We've received an extraordinary number of complaints from consumers who believed they were signing up for free items but wound up with unauthorized charges from this company," Madigan said in a statement when the suit was filed. "Because of cases like this, it's important that consumers carefully review their monthly credit card statements to ensure they're not being unexpectedly billed."

The complaint accused Peel and its President Brian Dale of selling products online at dozens of websites, including,, and The company marketed its products using "free trial" offers, which required consumers to provide their billing information-supposedly to cover shipping and handling fees for the "free" merchandise. However, days after signing up for a free trial, unauthorized charges ranging from $19.99 to $49.99 began appearing on their credit cards.

The suit also charged that consumers who did manage to reach Peel's customer service were given false assurances that they'd stop charging their cards -- which they didn't, as Consumer Ally reader Edna Marshall learned the hard way.

Marshall, a 60-year-old resident of San Angelo, Texas, brought Peel to our attention when she recently wrote for help in recovering nearly $500 she'd been swindled out of, one of many sites operated by Peel. Marshall said ShopDani was a shopping club that regularly shipped consumers inexpensive jewelry, but purportedly allowed them to cancel before the next piece was due to be sent.

"When I received the first piece, I was not happy. It was cheap and badly made, but I figured I had two weeks to cancel and send it back," Marshall told Consumer Ally. "Next thing I knew I started getting them every day for four days. I had already called and complained and canceled and told the woman that answered the phone that I wanted all my money back. She was very nasty and said I had to send back the merchandise, which I already had done."

Unfortunately, for Marshall, she'd already given her debit card number, and by the time she contacted her bank, they'd already debited her account by $487.63 "for the junk they sent," she said. "When I wrote to them they said my money was on the way," Marshall added. "I tried to call and the phone was disconnected. I went back to the site and it was gone."

Marshall certainly isn't alone. Online consumer complaint forums boards are full of complaints about, including negative reviews by Consumer Ally Partner SiteJabber, such as this one: "They are theives! [sic] They charge your account without authorization and then give a song and dance instead of refund! Do not ever send your Info as they will steal from you!!!"

According to the Better Business Bureau, Peel operated more than 20 websites and did business under more than 40 different names. To date, the BBB has logged 3,452 complaints from consumers about Peel and its numerous sites, earning the company a failing grade.

When Consumer Ally contacted Madigan's office for an update on the lawsuit, Madigan's Deputy Press Secretary Maura Possley said the suit had just been settled the day before, but hadn't made any news, since Madigan's office chose not to issue a press release.

Under the settlement, Peel and president Brian Dale, who did not admit any guilt, are banned from the online subscription buying program business for four years. Dale also agreed to pay Illinois $26,000 to fund consumer enforcement activities, as well as $15,261.90 in compensation for Illinois residents who were defrauded by Peel websites.

"The refunds to consumers from the settlement went to consumers who directly contacted us previously," Possley told Consumer Ally. "Consumers who were scammed can file a complaint with us and we will try to assist them, but the company is basically out of business."

Residents of Illinois and other states who complained to Madigan's office before the settlement was announced are eligible for refunds. But consumers like Marshall, a Texas resident who did not previously file a complaint, will receive nothing.

As of December 2009, more than 160 Texas residents complained to the Dallas BBB about Peel, so Consumer Ally contacted the Texas Attorney General's office to see if it was willing to help obtain a refund for Marshall and other Texans who were swindled by Dale and his websites.

"I couldn't afford to lose that money and I wonder how many elderly they scammed," Marshall said. "I am disabled and losing that money really hurt. Lord only knows how many people lost more money than I did."
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