For Immediate Release - April 29, 2010

Patrick-Murray Administration's Consumer Agency Review of Rebate Disclosures Leads to Retailer Improvements

Switch to 'rebate cards,' proximity of details in advertisements, are key concerns

BOSTON - April 29, 2010 - An advertising monitoring initiative conducted by the Patrick-Murray Administration's Office of Consumer Affairs and Business Regulation has led to changes in rebate policies by two national retailers and a major telecommunications company.

Sears, Staples and T-Mobile previously changed the form of many of their rebates from paper checks to rebate cards. However, consumers are generally accustomed to rebates in the form of checks, and rebate cards often include fees and restrictions not associated with rebate checks. The companies did not clearly and conspicuously announce the rebate details in advertising, an omission that created the impression that rebates would still arrive in the form of checks.

"For decades rebates came in the form of a check, and that is what consumers have come to expect. To change policies without clear notification is not fair to consumers," said Barbara Anthony, the Undersecretary of the Office of Consumer Affairs and Business Regulation. "When you consider these cards often have fees and expiration dates attached to them, these may not be a great bargain for consumers shopping for a better deal."

After meeting with the Office of Consumer Affairs and Business Regulation, Sears, Staples, and T-Mobile adjusted their rebate policies. Sears now makes its rebate terms and conditions available to customers prior to making a selection online and in-stores. Sears has also assured the Office that no fees are assessed for accessing the rebate loaded onto cards. Additionally, Staples agreed to offer consumers a choice of check or rebate card for the majority of its rebate offers; and T-Mobile will now disclose in its ads that rebates are in the form of a rebate card, and inform customers they may request a check instead of a card or redeem the card for cash at any VISA member bank.

"We appreciate and applaud the cooperation of these companies in working in good faith with our Office to ensure best practices in this important area of consumer advertising," said Anthony. "This ensures consumers are aware of how they will get their rebate, and eliminate unwelcome surprises."

The issue of clear disclosure is of particular importance to the Office of Consumer Affairs and Business Regulation, as well as businesses, after new state regulations took effect this January that speak directly to the issue of rebate cards. The new regulations (940 CMR 6.04) mandate retailers offering a rebate in a form that is not cash or check disclose those terms "clearly and conspicuously in immediate proximity to the reference to the rebate and the advertised price."

The Office of Consumer Affairs and Business Regulation reviews print and electronic advertising periodically to check that information and details of offers are being clearly and prominently displayed. These reviews ensure consumers are being given honest advertising information, and that businesses are not skewing the marketplace through unfair practices.

The Patrick-Murray Administration's Office of Consumer Affairs and Business Regulation works to empower Massachusetts consumers through education and outreach, and maintains a fair and competitive marketplace. The Office can be found at www.mass.gov/consumer and on Twitter @Mass_Consumer, and consumers can call the Office's hotline with questions and complaints at (888) 283-3757.