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DirectBuy Sued by West Virginia AG for Deceptive Sales Practices

I’ve written about DirectBuy before the the trouble some have had in getting out of their memberships. Now the WV has sued DirectBuy for deceptive practices.

Attorney General Darrell McGraw recently filed suit in the Circuit Court of Kanawha County against DirectBuy, Inc., headquartered in Merrillville, Indiana, and its local franchise, DirectBuy of Charleston-Huntington, and its President Timothy Parker for unlawful, coercive, deceptive, and high-pressure sales practices.

Beginning in 2009, consumers complained that DirectBuy, a discount buying club, pressured them into purchasing memberships costing thousands of dollars. DirectBuy coerced consumers by offering free trial offers, guaranteeing free gifts, and offering a variety of other promotions. When consumers attempted to redeem these offers, they discovered the offers were not available as promised. Instead, DirectBuy focused on selling expensive club memberships through a sophisticated and oppressive sales presentation.

DirectBuy targets prospective members by direct mail, internet, and television advertisements. The solicitations encourage consumers to contact the company to get their “free visitor’s pass” to its exclusive showroom. If consumers sign up for a free pass, they are invited to a sales presentation at the local store. After acquiring the consumers’ personal information, each consumer is paired with an individual salesperson for a high-pressure one-on-one discussion designed to close the sale.

During the one-on-one portion of the sales presentation, DirectBuy pressures consumers with its “now or never” tactic. DirectBuy warns consumers that anyone who leaves the premises without joining the club will be banned from joining forever. This threat is false, misleading, and unconscionable. When consumers become members, they discover that many of the promises DirectBuy makes during the sales presentation directly contradict the actual terms of the membership agreement. To induce consumers to purchase the membership, DirectBuy sales representatives offer money back guarantees, promise no hidden fees, and guarantee the lowest prices. These representations are false because the written contract specifically prohibits refunds, discloses various hidden fees, and plainly states that “DirectBuy does not guarantee that members will get the best price.” DirectBuy discloses these material terms only after the consumer has purchased and signed the membership agreement.

After receiving several complaints from consumers, Attorney General McGraw’s office opened an investigation into DirectBuy’s practices and determined that the company was engaged in unlawful sales practices. “West Virginians should not be pressured with coercive, deceptive, and unlawful tactics into buying expensive club memberships that have little actual value,” said McGraw.

Attorney General McGraw’s office seeks a preliminary injunction barring DirectBuy from engaging in this unlawful activity in West Virginia until further order of the court. The complaint further requests that the court eventually order restitution, refunds, debt cancellation, and civil penalties.

DirectBuy Sued by West Virginia AG for Deceptive Sales Practices
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Curtis1371

    I am trying to find out how to cancel my Direct Buy membership. I feel ripped off already. It has not been 30 days yet. Can I get out of this?

    • Billy Donerson

      I am having the sme problem! We could boycott if we get enough people

  • Smithson35

    DirectBuy is such a joke. “WE have to protect our secret prices…” That they tell everyone??? What a huge rip off and scam.

  • Smithson35

    DirectBuy is such a joke. “WE have to protect our secret prices…” That they tell everyone??? What a huge rip off and scam.

  • Damon Day

    Direct buy is horrible horrible horrible. Years ago when I was building a home I went to one of their pitches. It was disgusting and exactly how it was described above. Giving me this B.S. about how if you leave you can never join because we have now been let in on some secret that retailers don’t want consumers to know so therefore you either have to get in to the club or you can never join.

    I said, well, now that I know the secret what if I just told everyone? How does me joining protect your secret? I said, so you are telling me if I came back tomorrow and gave you the 5K cash (or whatever the fee was at the time) you would turn me away? Yup, we won’t take you.

    Who wants to bet me that if I walk up to a direct buy with 5K and tell them I went to their pitch years ago but now I am ready and would like to buy a membership they would say no? They would trip over themselves to take my money.

    And the kicker is, their deals are not even very good. They might have a few here and there that save you money, but a savvy shopper could easily save just as much without them especially in this economy.

  • http://DamonDay.com Damon Day

    Direct buy is horrible horrible horrible. Years ago when I was building a home I went to one of their pitches. It was disgusting and exactly how it was described above. Giving me this B.S. about how if you leave you can never join because we have now been let in on some secret that retailers don’t want consumers to know so therefore you either have to get in to the club or you can never join.

    I said, well, now that I know the secret what if I just told everyone? How does me joining protect your secret? I said, so you are telling me if I came back tomorrow and gave you the 5K cash (or whatever the fee was at the time) you would turn me away? Yup, we won’t take you.

    Who wants to bet me that if I walk up to a direct buy with 5K and tell them I went to their pitch years ago but now I am ready and would like to buy a membership they would say no? They would trip over themselves to take my money.

    And the kicker is, their deals are not even very good. They might have a few here and there that save you money, but a savvy shopper could easily save just as much without them especially in this economy.

    • Billy Donerson

      I am having the sme problem! We could boycott if we get enough people

  • Jason Taylor

    $2500 fee to save money, what does that sounds like… Also I wonder how many of the sales people he described were selling debt settlement lol

    http://www.youtube.com/watch?v

  • Jason Taylor

    $2500 fee to save money, what does that sounds like… Also I wonder how many of the sales people he described were selling debt settlement lol

    http://www.youtube.com/watch?v=4HEb1zfGgvw&feature=related

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