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:
Hi Eric,
No I do not think that you are responsible for the refund. Because you did not guaranty that this copywriter would complete the assignment. Also it is not your services that the person paid for.
Just like you said if you pay him then a lot of people will try the same thing because they maybe frustrated with other recommendations of yours.
You definitely do not have to refund this guy for his own stupidity, anyways who pays someone for undone work first.
Sorry to sound crude, but if someone wrote copy for me they would get paid a deposit and the rest on completion, after my final approval of copy.
I am so sick of society’s new blame game. Take responsibility for your own actions and stop pointing fingers at everyone else. It’s called personal responsibility people. Suck it up and move on. Things happen it’s called life. Stop trying to blame others for your bad choices.
As a struggling internet marketer, I read and and listen to all the “experts” advice and recomendations. Sometimes I get burned, sometimes I get lucky. I think in this case you are not liable for someone else’s work ethic. You recommended this copywriter as someone who did a great job for you. However, as someone who gives recommendations and advice on a regulare basis (making your living online) I would think some kind of refund should be made either monetary or product wise.
Just a few words
Due Diligence!!!
Don’t be lazy!!
Eric, you’re not responsible. It would be the same as if you recommened a plumber, kitchen remodeler, supermarket, mechanic, etc., etc., on down the line to a neighbor or friend and they had a bad experience. Would they come back and ask/sue you for the money lost or bad experience they had because you recommended that business or service?. I think not.
I also feel for your reader and the position he’s in and my recomendation/comment to him is “Take the copywriter to Small Claims Court and sue him for Non Conformance” and leave you alone.
I recommend going back and watching lessons #1 through #17. As I’ve taught, internet business is NOT for everyone. You may need to re-evaluate whether this is really for you. And if it is, you will be reminded of what ingredients are required for success in this business.
I would like to know if there are more ET readers who have been ripped off by him…
A benchmark is not a bad idea 🙂 Not sure I want to abandon many years of product reviews that I’ve already done though… hmmm..
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
Here in the UK we have an expression that is regularly applied to an assortment of circumstances.
The expression is “In The Good Old Days”
Not sure if that expression is valid across the pond in the USA but what it means is this: At some mythical time in the past, usually at about the time of your own (or your parents) childhood, “When Roses grew around every doorway; the sun shined every day; geese laid golden eggs and everything was wonderful”
This was a time, when every body always told the truth; all adverts were gospels and everyone was your best friend or trustworthy uncle. Unpleasant things sometimes happened but when they did, it was “an accident”
During the good old days, the watchword of any business transaction was, “let the buyer beware”
Now, instead of “the good old days,” we live in a “Nanny State.” This is the time where Nanny knows best.
When something unpleasant occurs, it cannot be an accident, it must be someone’s fault.
The buyer no longer has to beware, because consumer law protects us at every transaction we ever make. When something goes wrong, we are entitled to compensation.
If we can’t get that compensation from the guy who took our money, then we ought to get it from the newspaper that ran the advert or we have to get it from the government; somebody, anyone?
Eric, I love your turn of phrase:
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.
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.
You summed it up perfectly
The only way out of it is to go through the grief cycle, and reach a point of acceptance.
Eric, you are not liable legally, ethically or morally.
This Guy should learn something from this encounter and emerge all the stronger for the experience.
Dear Eric,
I am sympathy with you on what you are facing now. Just be wise to this case. Sometimes ordinary people before investing/buying/spending/hiring something from someone
especially if it is costly, they are looking for smart and experienced person who know with to get his opinion or recommendation before they made decision. In this case the people assumed that you are the right and trusted person that people believe the man you recommended is what they expected. However, they did not get it. Of course, they are
really disappointed with both of you and the man you recommended. So, it is understandable if they claimed with him. However, because he could not give refund from them then they shoot you. Although you have rights to refuse the responsibility of causing their loss. But morally, you are also responsible for it directly or indirectly. Well, doing
business always meet risks. It can be you or somebody else, depends on the judgment. So, it is up to you to follow it up or ignore it, I just suggest to make win win solution to
this matter to keep your name and reputation.
Best regards,
Edy
One thing you could have done is not to publicize this in the first place. You could have tried to contact the copywriter and ask him to explain himself (since you were promoting him I think this gives you a little leverage). Next, you could compromise with your client on a refund (doing this quietly would prevent any runaway refund attempts from other clients). The reason I suggest the refund route is because: In this day of rampant information and considering your knowledge and talents, I am having a hard time
accepting the fact that the copywriter wrote for you (did he know who you were?) and you thought it was good and then you stopped… no real research on this guy? I’m being nice here when I say to you: Aren’t you the guy who ‘bailed’ on the hype scene about a year ago and decided to play it close to home with your Lessons, Eric? Playing it safe, in my opinion, would be to teach about but not to endorse a particular copywriter…
Yes, I agree, buyer beware.
Small Claims Court exists for this guy and his copywriter.
If you have followed the FTC requirements (I would like to hear more about that from you) then you should have no legal concerns.
But, the rest is between you and YOU…
Peace
btw, Eric, keep those lessons coming!
It’s not your fault because :
1) You made a recommendation based on your positive experience with that copywriter.
2) You did not receive commission from that copywriter so why should you be liable for the refund request?
When engaging a freelancer, never pay them in full until he delivers the final product so the buyer should have made some sort of agreement with the copywriter regarding the payment for works-in-progress. So it’s the buyer fault if he chose to pay upfront. As always if a freelancer refuse a works-in-progress payment scheme then don’t engage him.
This is a complicated issue as you mentioned.
I think it addresses one reason I have not so far pursued affiliate marketing although I do have an interest in it. I have though as a teacher, run into similar problems, where I have recommended a product that was either not what I thought or did not work for someone else. So much money is not usually involved but I still felt terrible if I caused someone to buy something they can’t use. I really think an affiliate marketer has the moral responsibility to have enough history with a product that they can make a really honest recommendation. I don’t think anyone can recommend a product if they haven’t used it for years or in this case a person that you were recommending. However people change and so do products and so something that you felt was worthy of your recommendation might no longer be so. I would recommend always give a caution on your recommendation like I used this or this person and was happy with it or their work but I can’t guarantee that you will be. Why not look into it and make your own decision. As far as this person goes this could open up a can of worms if others hear that you have reimbursed someone. People fail for many reasons and they would love to get some of their money back at your expense. This could lead to many suits. I would probably want to do so too but if you do this for one there will be many more calling.
Linda Julian
It rarely hurts to ask, and like I said… I would have done the same.
Eric,
Liability is one thing, but your reputation and character follows you where ever you go.While I don’t think you’re liable for this, it seems re-imbursing him is the right thing to do.
I’ve been in IM now for only two years and have already been screwed over by several of the gurus. I’ll never have anything to do with them again and if anybody ever asks me, I’ll trash them. So the dollar amount involved isn’t worth creating enemies in the business–not that you’re wrong in not feeling obligated to pay him. It’s just not worth it, and you’ll be able to hold your head high!
Regards,
Tom O’Boyle
What would Amazon.com do?
I bought a $1200 Plasma TV through Amazon recently. It came on time and the whole process went very smoothly. I am also absolutely satisfied with the quality of the product.
Maybe, just maybe, I will set up an affiliate link for that product and market it to my list so they can watch the DVR recording of the final episode of LOST in the vivid color that I now enjoy.
However, I wonder what would happen if someone, from my list, got a defective TV from one of the other vendors on their website and that vendor was not cooperating with them. No refund, no exchange.
In looking at their Limited Liability statement on their website, I am sure that I nor Amazon would have to worry about being held accountable.
But, what would they actually do? We all know that their customer service is top notch.
Maybe, just maybe, they will offer the customer a discount on their TV (same one or of equal value). Full refund?….I highly doubt it.
You, Eric, are surely not liable. (except up to that $100 that you state in your liability statement…I guess a lawyer told you to put that in…but, i don’t know why you would have to offer even that)
However, now that you brought up a good question, why not set an excellent example for the internet community. Show us that IM businesses are real businesses…ones with customer service departments (at least in mindset).
You may not aspire to become the next Amazon. However, there might be something you can do for the guy. Such as, find him another copywriter that will follow through and negotiate a discount for what might have been your referral fee. Or, since you happen to be a very good copywriter (in my opinion), do it for him.
Just a thought, not a sermon.
I know those are dangerous grounds. Others might abuse it. However, the PR and reputation benefit might far out way the risk.
Then again….Maybe Amazon would not do a single thing about it, since they technically don’t have to.
If I recommended a service without having used the service and received satisfactory results, I might feel partially owing although in no way obligated to satisfy any complaint. It would be the responsibility of the person who failed to provide the service who is liable. The complaintant should have not paid for any service prior to receiving the service in question. I make it a point receive before I pay. I like to see what I’m paying for, then the decision is mine. If I told you to jump off a bridge… covers the situation. I’m not responsible if your stupid enough to jump without weighing the consequence. Although unfortunate you are involved… BUYER BEWARE
We all make mistakes. Chaulk it up to experience.
Legally I don’t think you can be held responsible for a non-compensated recommendation, especially when you had a previous good transaction with the person you recommended. Morally I think the complainer is way in the wrong by coming back at you for trying to help with free information. He is obviously a newbie and made two mistakes he should try to learn from: 1) No escrow account, cash upfront ugh!. The copywriter is also wrong for not having an escrow setup. 2) Newbie should have supplied the copywriter with a good descriptive layout out for his marketing strategy and products at the very first. Then he may have had a better experience. I’m newbie myself (age 74 and supposed to be retired) and I’ve personally received tons of good free info from you and others. But, I’ve also had my share of ripoffs, and this time I’m determined to get it right on the first shot. I’ve been the last 8 months learning everything I possibly can. My plan is just about complete and I intend to submit to several people for comment before going live. In your place right now I wouldn’t want to set any kind of a “standard” that had the potential to make things even more difficult for everyone doing business on the web or offline. Don’t pay this guy. If you still want to make him feel good: first give him some advice on how to get copyright done, then “maybe” give him something he can possibly use, but not money. Hope this helps. Russ
Eric,
I really appreciate your transparency and posting this on your site. It goes a long way, especially in todays IM world. In this case, you do not owe him a refund. And with you posting this I think it will do more for your reputation than not paying him would hurt it. Keep up the great work!
Escrow is good… I like rentacoder’s system. But if dealing outside a freelancer site, I would at least recommend breaking up the payment 50/50. Yeah you could lose the first 50%, but it’s more likely that the contractor will be motivated to finish the job so they can get the 2nd 50%.
I really made it more of a PR issue by publicizing it. Now there’s a bunch of people waiting to see what I’m gonna do!
I think he’s getting at least that much.
I am attempting to get in touch with him, thanks.
I agree with everyone here that you are not legally liable to this individual based on your recommendation.
However, I think this illustrates the importance of really knowing a product or service before we put out name behind it. It also has vital implications for the affiliate marketing industry. If people can not trust our recommendations, than we will lose credibility. Too much of this and people will be reluctant to buy anything online. So perhaps we need to find a way as an industry to address this issue. Our future livelihood could be at stake.
You’re right. I’m not sure if he’s in the US though, and if he is… it would not be 50%; it would depend on his tax bracket.
Hi Eric,
I wrote you a longer reply last night from my iphone, however when I clicked on sign up for a gravatar I misinterpreted it and lost my info, so now I’m just going to say pray on it.
Paul
Corrected the date, thanks!
“True compassion is to act with integrity and not with charity.”
That’s an interesting thought, I’ll have to let that one roll around in my mind awhile.
Thanks Paul – hey my Avast is giving me a virus warning when I tried to visit your blog.
I do not think that’s the case in this situation, but you certainly bring up a good point. And the thought did cross my mind. There is no limit to what con artists will do to get your money. It would actually be a fairly simple scam if Dragutin were in on it. OR better yet… what if he and the copywriter were the same person? Like I said, I really don’t think that’s the case here. But you definitely need to take those things into consideration before reacting when something like this is presented to you.
No I did not make any guarantees. The writer did offer a money back guarantee on his site. However, it appears Dragutin and the writer made the deal via email outside of the website.
Hi Eric,
I dont believe you are liable for this simply because you knew he WAS a good copywriter at one point and now he has failed… why should you be liable for HIS failure, now you know he is NOT a good copywriter and you did the right thing by not recommending him.
Now, if you want to do the right thing! make him an offer to do the copy writing yourself this way to get it off your conscience and it can only help you in the long run due to how you handled the situation. Just my opinion
Thanks, I did not make any commissions on this sale though.
To be honest I don’t think you could be held responsible on either count but I would ask that you take into consideration the following facts.
1. The copywriter was hired because this person trusted your views Eric so he obviously holds you in quite high regard and considers you honest and trustworthy. I think this is a big thing in this type of business.
2. You could say maybe the buyer was a little naive but so are we all at some point in our lives.
3. I’m not saying it’s your fault at all Eric but a little compassion would be good. What about meeting him halfway and refund half or whatever amount you think to be reasonable.
4. If you paid the guy an amount although this was not your fault I think it would say a lot for your strength of character.
5. This guy maybe like some of us and have very little money available but intent on living the dream. Sure you have been there Eric.
By the way really love your tips have really learnt so much from them. Many thanks for that. Hope my comment helps.
You are right, I do feel some obligation otherwise I wouldn’t have written the blog post…
I do not thing you are responsible
to pay this man anything. The
copywriter should pay him back,
because if he doesn’t his
copywriting days are over, after
everyone reads this.
Hi Eric,
This guy must be dreaming. If I have a problem with say Aweber or Hostgator, I wouldn’t Hold you responsible for any of it, just because you recommended it to me. I feel sorry he’s not happy with the work but you didn’t do the work. Anyhow there is a big difference between $197 and $1344.
Hi Eric,
It’s a heck of a dilemma, but I think you are correct in NOT REFUNDING the emailer.
I had a builder referred to me, got a quote, they seemed fine – and they then did a really rubbish job, using sub-standard materials & it cost me more to correct.
I would never ask the person who referred them to me for my money back – it’s not reasonable. I took responsibility for myself, as I had neglected to check whether they were part of the Master Builders association here in the UK.
So in my opinion : you keep your money, sad as that is for the guy who lost out…
cheers
Tracey
Not a bad idea. I normally charge $10k+ for sales letters, but it is something I could consider bringing to the table.
Raise the bar… I like it.
From what I can see you recommended the person because you have had positive results from him yourself which was honest.
I don’t believe you are liable to give a refund
because your customer took it upon himself to make the decision to buy and not you.
I do however understand your feelings about this situation and your customer.
I can only say that if I was in this position I think that I wouldn’t give the refund but I would do everything I could to help my customer get his money back from the guy who ripped him off.
Plus if I had received commission on the sale I would contemplate refunding him that amount but I believe this is not so in your case because you didn’t get paid either.
To put it bluntly, it looks to me like you both got screwed here.
I also think it’s great that you published this because it may open a few eyes especially with newbies and help people to avoid this sort of situation in the future.
Hey I still love ya man lol.
Have a great day 🙂
Ian Wilson
Interesting you say that, because I’ve found paypal to be pretty friendly to the buyer. With a few clicks the buyer can file a complaint with Paypal, and the seller must prove delivery of the product or else refund it. Typically has to be within 45 days though.
Appreciate your opinion as always.
I don’t feel you should be held responsible for the copywriter’s actions. You had no way of knowing he would act in this manner. Unfortunately for the person that lost the money, it’s an unfortunate loss. From reading the corresponding emails between them, Dragutin asked for too much from the copywriter.
Good question.
I contacted him previously on behalf of my marketing friend who had warned me about him after my initial recommendation. [redacted] did get that one worked out, but it took awhile. I also did some googling before doing this blog post, and found that several other people have written similar complaints about him around the internet. I’m seeing a strong pattern here, and it’s obvious that [redacted] has a problem. I’m not yet convinced that he’s a con-artist, per se. It could be that he has personal issues, family problems, a handicap, who knows. But he’s got a history of making excuses and not getting jobs done. Do I do feel this post is justified at this time.
I have also tried contacting him again today, and hopefully he will reply. Next step will be to attempt to call him on the phone.
You are right that I had no idea someone was spending $1400 with the writer.
I hear ya. I generally always honor refunds on my own products, even when customers are trying to rip me off. But $1344 for someone else’s product feels different…