Yesterday I received an email from a reader who had hired a copywriter based on my recommendation in late 2009.
Unfortunately, he was not happy with the sales letter he received from the copywriter, and the copywriter allegedly did not complete the work he had been paid to do.
About seven weeks ago, the reader wrote to me about his negative experience with this copywriter. It was the second complaint I had received from readers regarding this copywriter, and I had also received an additional warning from a fellow marketer.
At that point, I pulled my endorsement of the copywriter, and made it clear on my website that I am no longer recommending him.
Now yesterday I received another email from the reader…
Hi Eric,
I hope you are well.
Just to let you know I contacted BBB.org, PayPal and my credit card company.
The business of [redacted] is not registered with BBB.org.
The complaint with PayPal can only be filed within 45 days from the date of payment and that period is exceeded due to [redacted] procrastination and the story telling.
My credit card company is not able to provide the refund of $1344 I paid to [redacted] for the letters he never wrote as there is an involvement from PayPal between them and the vendor.
I acted on your recommendation to choose services of [redacted] as you described him trustworthy and reliable.
From all people and businesses who gave testimonials on his web site only one responded on my enquiry.
The others simply ignored my enquiry and some of the have URL error.
I do not want to lose $1344 USD for nothing as I acted in full honesty and transparency and am asking you to provide me with the full refund.
Hope to hear from you soon.
Kind regards
Dragutin
As you’ve seen, the reader is asking me to compensate him for the payment he made to the copywriter.
I should mention that I do appreciate his polite tone. If he had sent a “flame” I wouldn’t be featuring it here.
I asked him for some additional information, and here is a copy of his communications with the copywriter:
PDF of email correspondence [redacted]
So there are really two questions at stake here…
1) Am I legally liable for the products I endorse or promote as an affiliate?
2) What is the right and ethical thing to do?
The ramifications are very significant, because the answers to these questions affect not only this situation but also…
– Everything I endorse/promote.
– Everyone who endorses anything or promotes something as an affiliate.
This is why the Internet marketing world was in a tizzy last December when the FTC rolled out their new guidelines for endorsements and testimonials.
So let’s answer the first question, as it applies to this situation:
Am I legally liable?
According to the FTC, endorsers may be liable for false or unsubstantiated claims made in an endorsement, or for failure to disclose material connections between the advertiser and endorsers.
Let’s talk about false or unsubstantiated claims.
If I had blindly promoted the product/service without checking it out first (as many affiliates do in this industry, and as I have done in the past on occasion), then I believe I might bear liability if my claims did not match up to the product. Let that be a word of warning to all affiliate marketers: You ARE responsible for what you say/write.
However, in this case I was speaking from first-hand experience. I had actually paid this copywriter $197 to write a sales letter for me, and I felt that the product I received was a good value for the amount that I had paid.
Therefore, my claim was substantiated, and I made the recommendation in good faith that the copywriter would provide similar value for other customers.
Now let’s talk about disclosing material connections.
I initially wrote my recommendation in October of 2009, which was prior to the new FTC guidelines going into effect.
When the new guidelines went into effect on December 1st, I added an “Affiliate & Material Connection Statement” to my website, which I believe satisfies this requirement. If I am shown otherwise, then I might need to get more aggressive about disclosing material/affiliate relationships.
In this particular case, I never did get paid an affiliate commission for the sale in question. So I’m not sure how that affects the material connection from a legal standpoint. Am I still an affiliate if I’m getting scammed too?
OK, so in my opinion I am NOT legally liable for the copywriter’s failure in this situation.
But that brings us to the next question…
What is the right and ethical thing to do?
Although I am someone who believes in absolute truth, and a clear distinction between right and wrong… the realm of ethics can still be grey at times.
I’ve tried to put myself in the customer’s shoes.
If I were him, I probably would have written the same email to me.
I’ve been a victim of scams in the past, so I’m familiar with what he is feeling. It’s one of the worst feelings that the pallet of human emotions can paint. Anger, frustration, regret, self-loathing… all rolled into one. The only way out of it is to go through the grief cycle, and reach a point of acceptance.
From the look of my dear reader’s emails, he’s gone through the denial and anger stages, and has now come around to the bargaining stage. Like I said, I’d be bargaining too.
I see this from two perspectives… justice, and compassion.
From the justice standpoint, I believe it would not be right for me to give him the refund out of my own pocket. Would justice be served by this? No.
Now… IF I had been paid a commission, I do think partial justice could be served if I refunded that commission to the customer. But in this case, there is no commission to speak of.
From a compassion standpoint, I’d love to help out my reader.
If we were talking about a much smaller dollar amount, I probably would have just offered to pay for it (or more likely… I wouldn’t have gotten an email about it in the first place). But $1344 is a decent chunk of change.
We all know the golden rule: do unto others as you would have them do unto you.
If it were the other way around, would I want him to pay for my refund out of his pocket? Yes I would, at this moment in time. But after more time has passed, I would most likely come to the conclusion that justice would not be served by an otherwise innocent affiliate paying me out of his own pocket.
In other words, my sense of justice would eventually trump my desire for recompense. (The two are not mutually exclusive. The victim should be paid back in order for justice to be served, but taking the money from the wrong person is not the solution)
So I do not think it is my moral obligation to pay for the customer’s loss…
But I want to know what YOU think!
I told the customer I would post this on my blog, and take my reader’s opinions into consideration.
I want to know:
What would you do in my situation, and why?
I am absolutely willing to pay a full refund to the customer if the arguments in his favor outweigh the arguments against.
I wish I could just err on the side of compassion, but obviously such a precedent could open me up to a lot of headaches and abuse due to other customers taking advantage of my leniency. If that is the outcome, then I will probably change some things about how I run my business.
Post your comments below. Please do not “trash” me OR the customer or even the copywriter. That’s not the point of this. At the same time I am not necessarily looking for support. I want your honest opinion, even if you are not on my side.
Obviously this is not something that needed to be made public, but I am doing so because I think we can have a good constructive conversation. This is an important topic that affects all Internet marketers. So let us know what you think.
Thanks for your input!
UPDATE: I’ve now posted the conclusion to this saga here:
You are not responsible. You’re only responsibility is for transactions between you and another person. You have no responsibility for the actions of another person in a transaction to which you are not a party. Your recommendation was honest, even if other people might disagree. You could not control the terms of the agreement between those two parties. Why should you be responsible because he decided to overpay or pay up front (instead of after completion or in to escrow).
i want to make money I am just about to give up I have lost everything because of this stupid computer and not made 1cent
They should have checked this person out for themselves through the BBB.Not your fault. Buyer should always beware and keep their guard up.
Eric,
I too have been ripped off by [redacted], so I understand how this gentleman feels. As long as you made the recommendation of the the product or service in good faith, you are NOT responsible.
If you knew the guy was a crook and recommended him anyway, that would be different.
John
No, you are not liable. You had a good experience with the writer and on that basis, you made an honest recommendation. The person who expects you to refund him for his loss needs to go after the writer. It may be difficult if there wasn’t a contract or written agreement. In such cases, a contract should also stipulate the amount of payment, how it is to be paid and when. The full amount should not be paid upfront unless it is to an escrow account that the writer could not access until the job is satisfactorily completed.
In my opinion you do not owe a refund to this person. Yes, you made a recommendation on a product that you have used before. You do not know how the transaction went between this person and the copywriter. You gave a recommendation or opinion that is all. Just because you recommend something you should not be held liable. It would be like you recommending a vehicle and it broke down would it be your fault nope.
While no legal liability may exist, your character and reputation could be impacted way beyond this incident. The higher road is often the best road to travel. You may want to establish a benchmark for your recommendations, i.e., BBB, Background and Credit Report, three supporting customers, etc. This would establish your ethics in terms of recommending or endorsing products or services. I would suggest contacting the party and asking him honestly what degree (%) does he truly believe is your obligation. Often this will not be 100% and protects your reputation.
I think the guy is operating on the philosophy that it doesn’t hurt to ask. Or he’s just crazy!!!!
You are not responsible for what has happened between two other people. However…you did recommend him,but you were satisfied with his workat that time. That does not mean someone else will be. I feel for this person,but still not your fault.
This is not your problem. Justice can only be served by the copywriter paying back the money. You’ve done your duty.
If Dragutin cannot produce an agreement between YOU and HIM that YOU would provide a service to him, you are not liable for a third party’s failure to provide that service, unless Dragutin can produce a personal guarantee executed by YOU that the service would be provided by that third party.
I think it would set a bad precedent for all affiliates,the obligation for refund would clearly lay on the business the product was purchased from, I feel for the person but cant see any obligation on your part, even when you recommend products or services, I base the purchase upon my own decision to do so, the recomendation helps a bit but its still a transation between the buyer and seller..
Hi Eric,
This complaining customer has a lot of nerve!
I can see that he is upset, but he’s barking at the wrong person.
You absolutely don’t owe him a refund since you never collected any money from him in the first place. Your recommendation of this copywriter was just that, a recommendation. You are not responsible for how well this copywriter performed or for the ultimate dissatisfaction of the customer. The burden is on the customer to have assessed the copywriter and to accept the results of working with him.
You have already been more than right and ethical. You have listened to this unhappy customer and responded. That’s enough.
Eric, no I don’t think you should repay him, especially since you did not receive any type of commission for recommending the copywriter.
As you have stated in your statement, the copywriter provided good service to you and you had no reason to think that he would have not given the same type of service to someone else.
I think the lesson learned here is that when dealing with someonen like the copywriter, both parties should go through a service like elance where the money is placed in escrow until both parties agree that the job has been completed to satisfaction.
I feel bad for the guy but we have all been there at the school of hard knocks.
I feel you are not responsible as you made the recommendation in good faith going on your own experience with the copywriter.
You might however, offer something to placate this guy .Like maybe some of your products that would equal the amount he lost.
I don’t believe you are responsible for another persons actions. If a person is fair and upstanding with me and I recommend him to someone else and he rips them off or does them wrong, I would surely sympathize. Like you said you know what it feels like to be scammed. But the Peter pay for Paul syndrome does not apply here. Personally IMO this has nothing to do with you. You didn’t take his money and run. I’m sorry that he got hurt by this but it really has nothing to do with you. Like David said. No matter what you cannot control what happens between two other parties. I certainly was not paying anyone no matter who recommends them all that cash up front and they didn’t do any work. (magic word: Escrow) That my opinion
Eric, I do not see how you could possibly be liable to pay this. Although you recommended this copywriter, the transaction is between these two individuals. I have had friends and acquaintances recommend services to me that have been disastrous. However, it never even crossed my mind to seek reimbursement from those who made the recommendations. This just defies common sense in my opinion.
I have to agree with David. My stance had you made a commission might differ, but you simply offered an opinion based on your experiences. Opinions are free (and often that’s all they are worth). If you’re not paid for them, you should not be held monetarily responsible for them.
Just my 2 cents. ~Jane
He should have handled this within the 45day period. That is why Paypal has a time limit…he procrastinated and is now grasping for the (perceived by him) easy straw
Eric,
Unfortunately, at this stage of the game it is a public relations problem. If I were you, I’d bite the bullet and pay the aggrieved custer. It would be worth it in good will and word-of-mouth advertising. I would also strengthen my disclaimers around anything I would endorse in the future, and I would change the way I do business to be more restrictive in those areas where liability might affect my business negatively.
Eric,
I can’t see that you wouldn’t be responsible for the refund, however…I have always told my clients, be careful before you endorse anyone, because it reflects back on you.
You had used his services and been pleased in the passed, so you did indeed try his service before recommending it…good for you on that point.
I just can’t see you being responsible for a refund without benefitting financially from the recommendation.
Not your problem Eric; you did the right thing by removing your recommendation.
I don’t believe you are responsible. The responsibility lies with the person who was supposed to do the work for what they were paid for. People recommend other people for things all the time like auto work or construction and sometimes things don’t work out. That doesn’t make you responsible to pay that person back if they were unhappy with the service. The person that is unhappy obviously won’t trust your recommendation any more but you are not liable for someone elses actions that are out of your control.
Rob
Eric –
I believe your logic/reasoning is thoroughly
correct & fair.
But do this affiliate (& the rest of us) a favor – give this bozo “copywriter” at least
$1344 worth of your negative publicity.
“What goes around, comes around”. The JERK
deserves at least that much.
I do not think you are legally responsible for refunding this man’s money, but if you want to be a nice person just give him a refund since he acted on your recommendation.
I feel bad for the person who lost the money from someone who apparently failed to provide the service as promised. You made a recommendation in good faith based on your experience with the service provider; you did not guarantee that someone else’s experience would be the same. The reader can’t possibly hold you liable for a good faith recommendation based on your personal experience; every transaction and business relationship has inherent risks. While his reasonable expectation would be a successful transaction (as you had experienced), he had no guarantee of the outcome. You made an endorsement, recommendation, whatever you want to call it… but it was never a contract, implied or otherwise, between you and the reader who acted solely on that recommendation. He needed to perform his own due diligence before entering into a contract with the service provider. And no, I’m not a lawyer. Lol
Eric,
In my opinion,
1. You are not legally liable to pay
2. You are not morally bound to pay
However, I feel that there is a moral committment to try to bring this [redacted] to HIS moral senses, and refund the said amount. If through contact and asking for common decency to prevail, there is no action on his part……I would suggest some type of global effort to at least have his Paypal account frozen. Yeh, that should do it.
Eric- You did nothing wrong here. Unfortunately, this kind of stuff happens in busines DAILY and it happens to everyone. It’s just the BAD PART of doing business. There is a remedy that the injured person who is out $1344 can take advantage of. He can write off the $1344 from his 2010 taxes. It was a legit business expense, a cost of doing business and he can write it off either as a business expense or as a BAD DEBT (depending on his tax situation) and he’ll recoup at least 50 per cent of his money back around April 15, 2011 from UNCLE SAM.
I agree with David in that you are not legally responsible. I feel sorry for the customer who is out the money but it is HIS lesson to learn to not pay such a substantial amount UNTIL his product or service was received by him. If you feel a moral obligation to help him, I would recommend one half (1/2) or the commission amount, whichever is the lowest. Hopefully he would recognize that he should be grateful for your compassion. The only problem with this is it may (legally) be an admission of guilt and cause you to be responsible for the entire amount. There are many lessons here for all of us living and doing business in a sometime dangerous world. May you find the guidance to come to a peaceful decision. God Bless
Eric,
I don’t think your at total fault but you did endorse this fellow, right? How about going half way. Give the guy half of $1344. If he doesn’t agree, c’est la vie.
Hi Eric,
I know you are a man of your word. Of all the marketers online you are the most ethical and honest. What you did was try to help your subscribers by recommending someone who took care of you. People change and that is not at all your fault or responsibility.
I wouldn’t recommend that person again though since another person said he was ripped off.
I believe this person claiming from you a refund for something he didn’t buy directly from you is absolutely out of his mind or totally cheeky.
If I go to a website, or any other place, and I read about someone being recommended for a job. I hire that person and everything goes wrong and I lose money, what? Am I going to ask for a refund from those that recommended this person? What do they have to do with the deal I reached with that person? The fact that they may have done business with that person in the past and everything turned out all right for them does not mean that everything should turn out well for me too.
If you didn’t receive any commission for recommending him, which is the only money that you could refund him, there is nothing else you have with this case.
Eric, you are being TOO nice to him for even considering his claim. Some companies would just laugh at this person’s claim. Totally absurd! Ridiculous!
Dragutin entered into a contract with [redacted]. If the terms of that contract were not kept then he should be suing the guy himself. If I told my friend that I had a great holiday with company X and they booked something through them and they had the holiday from hell then I would not expect them to ask me for their money back. When you enter into a contract with someone it is only common sense to do due diligence. A recommendation from someone does not excuse you from this.
You did not intentionally dupe this person. You merely recommended somebody that provided a good service for you and had no problems with the end product. I’ve been burnt many times online, but there are good people out there, they are just very hard to find. I don’t think you are liable for this person being dissed, nothing should come out of your pockets. You really have to research, check scam sites and go to the search engines, you can find out something about people and businesses before you get involved with them.
before going into details I suggest correcting your typo where yo say yo made your recommendation in October 2010. That would be difficult!I don’t think you are liable but you/we have learn’t a valuable lesson.
At the end of the day there are way too many examples of exaggerated “expertise” for sale in this business, including some of the giants of SEO. Just put a caveat in your recommendations: Caveat Emptor
I agree with David.
True compassion is to act with integrity and not with charity.
A recommendation is just that and the decision to form an agreement with a third party is the accountability of the two parties involved.
As you received no payments associated with this deal, you are definitely not liable.
I understand Dragutin’s feelings and have empathy. We all have made unfortunate decisions. This was one of the decisions for Dragutin with the accountability for it.
I hope Dragutin can accept that this was a decision he made and realize the accountability of the decision is his.
Being a victim will not benefit anyone.
There is a lesson for him here and probably one for all of us.
Eric,
I have been on both sides of this type of situation – paid for something that did not get followed through on, and ended up losing the money, no refund, no trace of the “owner”.
Caveat emptor.
I also have been involved in affiliate promotions, and try to do my due diligence on who I promote, as well as their products. (You are a prime example! – someone very trustworthy)
Considering the well laid out points you have posted, I feel you have covered the ground necessary regarding the complaint and request.
In my opinion, I do not think you are liable for the refund. Given the information that you especially did not receive an affiliate compensation. In that case, if it were me, I would at least offer my affiliate commission for my part in the issue.
I appreciate you taking the time to post this and request feedback, as it is certainly an issue we need to keep aware of.
Best always,
Paul Klein
I have a question for you? ARE you GOD? about this person losing money, it happens every day I WHINED ALOT at first.NO I WOULD NOT GIVE BACK THE MONEY,BECAUSE HE HAD THE OBLIGATION TO TAKE EVERY PRECAUTION,IF HE DIDN”T LIKE THE GUYS WORK HE SHOULDNT HAVE PAID HIM. I DON’T CARE IF MOSES TOLD HIM ABOUT THE COPYWRITER,THERE IS PLENTY OF ROOM BESIDE ME TO PISS INTO THE WIND,WE CAN CRY TOGETHER.KEEP YOUR MONEY. BOB GREEN
I do not believe you are responsible. “Let the buyer beware!” If you indeed made your recommendation in good faith based on your own experience then you are not liable for the copywriter’s failure to comply. Nor are you laible to refund the money to the reader because he took your word and did not thoroughly check out the copywriter before making such a large payment. Who knows, this could be the beginning of a scam of it’s own! The copywriter and the reader could be in cahoots to start a precedent where no one would ever be safe to offer advice or recommend anything or anyone! Imagine the repercussions! I guess I watch too many crime shows! But I could be right…
Hey, Eric..
What do lawyers get paid for? If you play with live wires and are not a electrician and you get shocked, who’s to blaime? I have worked with your material for the last three years, and haven’t made a penny. I am to blame, not you. But you could be giving me more ideas instead of arguing a non issue.
Keep up the good work you are doing and don’t lose the trak due to the nates in the air.
the writer has an obligation to the client you were only acting as he go between .your responsibility in after you deliver the article written j&b rewritten ,well as you please the client there is a concert in legal terms called let the buyer beware you did not pay for the service that he received nothing from the writer healing cracked and thinking that you hell yeah my name sorry for the misspellings this is a droid phone voice to text technology again the service was rendered drink wine and a writer if he was not satisfied with the article we should have said so
Eric,
You are caught between a rock and a hard spot.
A recommendation does not necessarily mean you made any warranted gaurantee on the writers work. The customer should pursue small claims court action since the arrangement was between him and the writer. That would seem to be his only recourse. If you had sold a product with a guarantee attached (JV Partner Offer) then he could pursue the money back within the stated period of time. Did you guarantee the work of the writer? If you did, then you should pay him the money out of your pocket. That would be the right thing to do.
There’s no legal responsibility from what I can see. However, that’s not the real issue here. It’s your credibility.
For too long marketers have sent out affiliate deals using “reviews” or testimonials that were questionable. Not saying you did this, but we all know about the practice. The only real relationship is usually the affiliate deal and the marketer will use any tool necessary to make the sale.
You made the recommendation and you presumably made 50% of the $1,344. Your customer, trusting you, lost out because the vendor didn’t come through.
To make matters worse it appears that [redacted] isn’t great at customer relations, doesn’t look to minimize problems and protect his partners from what you’re experiencing, etc.
He may have his own side to this, but in the end the happiness of the customer is what counts, particularly when the customer belongs to a partner.
On the financial issue, I offer two ideas; one for now and one for future dealings.
If it were me, I would refund my commission to the customer as a good faith offer. Maybe even tack on one of my products for good measure. He probably doesn’t expect it and will likely be overjoyed at the generosity.
This also sends a signal to your customer base that you stand behind what you’re involved with.
Bottom line Eric, this is now more about you than it is about [redacted].
For the future I would require that a percentage of sales be held in escrow for a period of time, to allow for complaint handling.
Just my .02.
I wish you well.
This is unfortunate Eric, things happens,you
are not responsible, only made suggestion.
First a comment, this is one reason I do not work with affiliates.
Now to the question, you are correct about morality being the guide, and I do feel for the person that hired the copy writer. I checked out being a member of the BBB, the cost would be in excess of $500 a year, which is also not a pittance especially when it comes to someone trying to establish themselves in business.
While I do feel for the client, you are not responsible for the lost fee. Before someone hires a person, they should ask the copy writer, in this case, for other clients that the copy writer has written for, and ask the clients how well the writer did on the job. Also, writers and clients should have a contract that explains in detail what the writer’s and client’s agree to and how payment is to be made. As a freelance writer, that is 25 percent up front, balance when the client is satisfied with the job.
Again, you are not responsible for the refund, the copy writer is.
HI Eric
Next time when you recommend something just have a clause that says…. you know what I mean.
Would you exspect your nieghbor to pay for car repairs because he sent you to a bad mechanic?
As you explained the situation, there is no way I would have you pay for anything.
That being said, if I were you, I might have a quality copy writer do you a favor and get your reader what he needs at a highly discouted price. (just a thought)
Or offer a small service of your own to help the reader recoop his losses.
All I am saying is, I don’t find you at fault, but this could be a great chance for outstanding customer service:)
Good luck, don’t pay but lessen the blow
Eric,
I think you have a problem. My openion is you are not liable but the fact that you even question the demand says you feel obligated and owe the man something. I can’t answer your question should you or do you. The internet is the most dangerous place ever to do business so put in a disclaimer and the buyer has to go back to the vendor for his money.
Bill
I am sorry that this customer did not get the work done that he paid for.Not to say anything bad about the copywriter,but if he was paid to do a job for someone,and did not complete it,or finish it to the customer’s satisfaction,then the copywriter should refund the money to the customer,or at least try to work with them to rectify the problem.I was always told,the customer is always right.The exception to that last paragraph is,that the customer should not hold the person who recommended the copywriter,liable for any refund.Come on,you only recommended the person,and as far as you knew,he or she,was good at what they did.How were you to know,that this person would not complete what they were paid to do.I feel bad for everyone,but I think everyone should sit down and see if this can be taken care of,and come to some decision,that will be agreeable to all parties.If that is not the case,then the customer should take legal action against the copywriter,not you,to maybe get some if not all,the money he paid.Finally,I still say that you recommended the person,but where would that make you liable.Also was there a contract for this work.I hope this helped you a little,and once again I feel bad for everyone,but the copywriter needs to refund the customer,because that is what is the right thing to do,and the professional thing to do.Thanks Eric,please do not feel bad,and thanks for asking me,for my opinion.Respectfully,Fred
I don’t feel that you are responsible. Whether you got paid or not from the copywriter is immaterial. Did you have a valid, in force agreement, with the copywriter at the time of the agreement between the two? If you did then I feel that you owe him what you would have made even if you did not receive it from the copywriter. Everyone got scammed. If your agreement was only if the sale went through your sales channel, which you can verify, then perhaps you’re off the hook.
Since you have rescinded your endorsement you show that you are taking action against the copywriter. Is it sufficient? Maybe not. Since you’ve been provided with copies of the e-mails you could put them up linked to a “no longer endorsed” notation for the copywriter. (with all the necessary disclaimers i.e. Copywriter has refused to return my calls or emails)
Lastly, maybe you could suggest to your readers that they contract with copywriters that are willing to do their work with payment held in escrow. Or payment upon satisfactory completion or half now, half later or some other terms.