Attorney General Cuomo Recovers More Than $450,000 In Refunds And Penalties From Online Magazine Vendor

NEW YORK, N.Y. (September 29, 2008) — Attorney General Andrew M. Cuomo announced today that his office has filed a settlement agreement with magazine seller MagsForLess.com over the company’s failure to fulfill magazine subscriptions or provide timely refunds to consumers. 

In settling the Attorney General’s case, MagsForLess.com must improve its Website and ordering process, provide full refunds to consumers who never received magazines, and pay $100,000 in penalties. So far, the company has paid more than $350,000 in refunds to consumers.

“Online sellers cannot hide from their obligations to consumers,” said Attorney General Cuomo. “My office ensures that New Yorkers making purchases on the Internet have the same recourse as those who make purchases at brick and mortar stores. Companies that take customers’ money must either deliver the product or issue a refund. Anything less is fraud.”

MagsForLess.com, also known as HalfPricedMags.com, SnappyMags.com, AlmostFreeMags.com and My1Mag.com, is owned and operated by Joel Simkhai of New York City and offers discount prices on subscriptions to a wide variety of popular magazines, including Rolling Stone, US Weekly and Forbes.

The New York Attorney General’s Internet Bureau received more than 500 complaints from consumers about the Website – the most the Internet Bureau has ever received on a single company. The office conducted an extensive investigation that revealed that when a customer placed an order for a magazine, MagsForLess.com immediately charged the customer’s credit card or PayPal account. Customers were then notified that magazines may not arrive for up to 12 weeks. When the magazines failed to appear after the waiting period expired, it was often too late for customers to dispute the charge with their credit card company or PayPal. MagsForLess was also unresponsive to requests for refunds before the Attorney General’s intervention.

The Attorney General’s office worked closely with MagsForLess to address outstanding complaints, resulting in the company paying more than $350,000 in refunds to consumers to date.

Under the terms of the settlement with Attorney General Cuomo’s Office, MagsForLess must:

  • Process all magazine orders within seven days of receipt.
  • Clearly disclose when consumers can expect to begin receiving magazines.
  • Provide a simple method to contact the company regarding pending orders or refund requests.
  • Process and pay all new refund requests within seven days of receipt, plus all outstanding refund requests.
  • Contact all existing customers regarding the settlement and the opportunity to obtain refunds.
  • Pay $100,000 in penalties to the State of New York.

Programs Director for Consumers Union, publisher of Consumer Reports magazine said, “Consumers have a right to expect that online sellers of magazines and other products will deliver them promptly as promised, and issue timely refunds if the products are not received. Thanks to Attorney General Cuomo’s intervention, hundreds of consumers will receive refunds for magazines they didn’t receive.  This settlement also sends a clear message to other online merchants that they need to obey New York’s laws regarding Internet sales practices, and act responsibly if there are problems in fulfilling orders.”

The Attorney General’s Internet Bureau has received thousands of complaints in recent years regarding failure to deliver goods ordered online or other improper conduct related to online purchases. Because of this, Attorney General Cuomo last year announced the passage of a new law to ensure consumers are afforded the same protections as those who make purchases over the phone or through the mail. Those protections include:

  • Orders cannot be accepted for merchandise which cannot be reasonably anticipated to be shipped within 30 days.
  • All advertising and promotional materials must prominently feature: the legal name of the company, complete street address and details about what conditions in which a refund will be issued.
  • If products fail to ship within 30 days, the company must clearly provide the buyer with the opportunity to cancel the order and receive a refund or receive substitute merchandise.
  • Companies must maintain records of all complaints of failure to ship merchandise or provide advertised services.

The investigation was handled by Assistant Attorney General Carolyn Fast of the Internet Bureau with the assistance of Investigator Vanessa Ip and Confidential Mediators Penelope Lerner, Rachel Mills and Steven Spitzer under the direction of Justin Brookman, Chief of the Internet Bureau.

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