The New York Attorney General's office has launched an investigation into the marketing practices of 22 online retailers and requested information about their relationships with three marketing companies: Webloyalty, Affinion, and Vertue, CNET reports.
The firms in question allegedly misled consumers into joining membership programs and paying loyalty fees for online retailers like Staples, 1-800-Flowers, and Orbitz. The three marketing companies and their alleged misdoings were previously the focus of a Senate investigation last November.
The companies are post-transaction marketers that typically present pop-up ads to shoppers as they're finalizing a transaction. The ads appear to be from the retailer, offering discounts or cash-back coupons in exchange for an email address or name. However, the fine print of the ads state that by signing up, consumers are agreeing to a membership program and authorizing the company to charge their credit card as much as $20 a month, according to CNET.
Several of the retailers are already cutting ties with the marketing companies. Evidence uncovered by the Senate committee shows that the marketing companies knew their revenues would plummet without access to credit card information from retailers.
