The average Canadian is bombarded with dozens of online scams daily. While most of these are easy to spot (and likely filtered out automatically as junk mail), some are convincing enough that even veteran deal hunters can fall victim to. Recently, we’ve seen an increase in “membership scams” online, we’ll examine what these are, and how to avoid them.

What are membership scams?
Membership scams come in different shades of gray, ranging from plain lousy deals to truly malicious with fraudulent intent. In a nut shell, they can be defined as clubs that use deceptive tactics to enroll members and which offer benefits that are less valuable than what the membership costs. A good friend of mine (well respected guru in the online deal hunting community) recently fell victim to a best value program from a certain US based discount book sale site, mistakenly signing up to pay $19.95 a month for something that he feels is nearly worthless.

Nothing is really free
One way to recognize these types of memberships is to understand that nothing is totally free. Businesses are run by humans, humans need food, and food cost money (unless you are a farmer, but then you need machines, fertilizer and other stuff that still cost money). While you may not be the one who personally foots the bill, someone eventually will have to in the end. If a site is offering a service or product for free and no one is paying, then red flags got to go up. Like the old saying, if something is too good to be true, it probably is.

Read the fine print before you click
The too good to be true rule works most of the time, but it isn’t always good enough. One of the reasons why our deal hunter was fooled was that the bait didn’t seemed too good to be true. It was only a small discount off the regular price of the book. Thus, the most important rule is to understand all of the terms and conditions before giving away your financial information, especially on un-trusted sites. To help provide a safer environment, Wishabi deploys a team of secret shoppers to evaluate the policies of partnered stores (The Source, Canadian Tire etc…) and would never showcase offers with deceptive practices.

What to do if you fell for it
All hope is not lost if you mistakenly signed up for membership that you’ll regret. First, contact the company that is sponsoring the club and tell them firmly that you want out and your money refunded. Most of the time, they are well aware of their practices and would rather pacify you than to let the situation blow out of hand. No matter what they say, be sure to follow up by a call to your credit card company and let them know that you’ve been deceived. They’ll open their own investigation and initiate the charge back process. The above two steps usually guarantees that you’ll get your money back, but if you want more, consider contacting BBB and law enforcements to force the company to change their practices.