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:
yeah I did mention a copywriter list on the warrior forum. And yup… I just checked and [redacted] does have some complaints over there.
Working on it now. I’m a little more than a neutral 3rd party though, because the copywriter has put my reputation in jeopardy too…
I don’t think you should pay him money for services someone else was supposed to provide. While you did recommend him to your readers based on your good experience with his services, you made no guarentee to your readers about the quality of his work.
The copywriter did create a “sales letter” for Dragutin, however it wasn’t to his satisfaction. Nowhere in their correspondence you have posted was the original contract between the two parties, so there is no way to know if revisions are part of the original contract. I feel sorry for Dragutin in that he feels he “got scammed” by this copywriter, however that being said…it’s not your fault.
It’s sad and I hate that it happened because it makes people not want to trust us IMers because they lump us all together in the same boat of cheats and liars. Some people will definately fit that mold but the vast majority of us are just trying to provide a good living to take care of our families.
My sugestion for Dragutin is if he really just wants his $1344 back then he needs to hire a lawyer who specializes in internet law and go after the proper person(the copywriter).
Eric, I have been on your list for over 2 years and have bought several of the products you have recommended to help me make money online. While none of them have made me rich, I don’t think it is your fault and I would never even fathom asking you for a refund on a product or service that wasn’t yours.
As an affiliate marketer I always try to do my due diligence before I promote or recommend someone else’s product. I feel if you refund this person’s money it will set a precidence that we as affiliates can never come back from.
Dragutin needs to accept responsibily for his actions or seek legal restitution from the copywriter not you. It’s not like you made him spend that much money on a copywriter when he could have just as easily gone to elance.com and got someone to do it for next to nothing…
I’m just sayin’
“What’s your gut telling you?”
That’s what my wife said. It’s a good question.
“I’ve recommended your site and trainings to a number of people, and own some of your products.”
Thanks!
I agree with Karen. I thought of another way to “meet him halfway”. He wanted the copywriter to help him with his Internet business. Perhaps you can give him access to another program that you know has top-notch info. It would be less money out of your own pocket, and still help him along in his Internet business.
fixed the date, thanks
“What would have happened if Dragutin paid [redacted] the money, [redacted] produced a great sales letter, then Dragutin for some reason got Paypal or his credit card to refund him his money. Would you now be liable to [redacted]?”
Very interesting reversal.
yeah. I did mention in my lesson that [redacted] was currently charging $300 – $1000 at the time of the lesson ($300 for a sales letter, with higher priced packages if included with autoresponders, squeeze pages ,etc). But I wondered the same thing too when I saw the $1344. Makes me think [redacted] had some bills to pay…
I would offer him something free that you produce to show you are dealing with him/her in good faith. However, the onus on the product purchased is on the copywriter.
1- i did check him out first.
2- yes I do realize, which is why I wrote this post and solicited your opinion 😉
Eric,
In my opinion, you’re not responsible. Although when you make recommendations from now on, you may want to suggest that the person or entity you’re recommending be checked out through the BBB or websites that post scam complaints. I’ve been scammed in the past and am very cautious about taking anyone’s recommendations. I always check the BBB before committing my money to anything.
“my experience was that this guy should have gone to architectural school rather than dentistry”
LOL… I’m sorry!
Of course you are not responsible .I think it was irresponsible to give him the money up front.read my blog world economics 101 http://bit.ly/df56KX
Good rant. It brings up some interesting points that I’ve been thinking about. As some have mentioned, courts of law often do not take a website’s “terms of service” as being a legal and valid agreement. So the only way to really protect myself would be to get a signed agreement from each subscriber. While that would be virtually impossible for a free blog, I could change my business model and cater to a smaller group of people in a closed area.
ah, the wisdom of Oprah!.. jk 😉
It would be easy to side with your customer However,the old saying of caviate emptor comes to mind regardless of what it is you are purchasing. Due Diligence is all important. Your subscriber did not do his due diligence and check out the copy writer further by using Google or whatever means to double check what you were telling him was still the truth. Unfortunately people change for whatever reason good or bad, and in this case it was bad.The only other thing I can suggest is make sure his name is advertised all over the net as someone never to use.
Thanks Ari. You are right, I “don’t need random readers to give their unbiased opinon so that you can make a calculated decision on this very simple case.”
However, I do care about what my readers think about this. It affects the future of how I do business and communicate with you. And look at the very next comment:
“I like your having posted the issue with your readers.”
Hi Eric
I’m new to this and have come unstuck a couple of times myself. What is a recommendation? I believe that if you have used a service and received a certain standard of work equal to or better than expected, then a recommendation is in order. If that provider were to enter into a written or verbal contract with another person and that person receives an inferior product then his right to redress is between is between them. As the source of recommendation, you may feel feel a little uneasy but at the end of the day, you acted on your own experience and that is all a recommendation is, or can ever be. There is no possible way that you can monitor every piece of work that provider churns out.
Rick (mindfocus)
“As a former judge and attorney, I have a studied opinion on the matter. And, as a dedicated internet and affiliate marketer, I felt the issues raised were so urgent that I paused my project on a deadline to enter my response.”
Thank you for weighing in on the matter!
It sounds like ‘Dragutin’ made a mistake in judgment. He needs to take his own advice:
“Education is not expensive, ignorance is.”
He needs to learn that:
1. A recommendation is just that, and nothing more. It is not providing a product or a service; if I have a good experience , then I will make a recommendation. If I take someone’s recommendation, then I need to use common sense.
I would start with a small investment, so as not to risk a large loss in the event it doesn’t work out. If I’m satisfied with the value I receive for that small investment, then I may risk a larger investment. I do my research; I read, and I seek counsel.
As always, I have to take into consideration about the possibility of losing that investment and whether I’m willing to live with that. If I am, I make the investment. If I’m not, I don’t make the investment. It’s as simple as that.
2. Life is all about taking risks, some small, some great. But that’s the beauty of individual liberty. We are all free to take such risks. However, the flip side of that is individual responsibility. We cannot have the freedom to take risks without also taking responsibility for them. If people refuse to take responsibility and always want to hand it over to someone else , or the government, then loss of liberty results as well.
Two sides of a coin. Dragutin took a big risk in spending that large amount on an unseen product. He therefore, needs to take responsibility for that decision. Learn from it, chalk it up on his taxes as a bad debt, and manage his risks better in the future.
Having said that, Eric, because your conscience is weighing on you, God obviously wants you to do something. Since you have no legal obligation, under FTC rules, to give him a refund of a service from another provider, this action will be purely based on ethical grounds.
As Christians, we’re called on to “go above and beyond the call of duty”. Jesus said, when someone strikes you on one cheek, offer him the other. He tells us to “not be conformed to the pattern of this world, but to be transformed with the renewing of our mind.”
Which means, that we are to do opposite of what the world would do. This is what differentiates us.
No one can tell you what to do. However, we can help steer you in the right direction. And we can tell you, what we ourselves would do.
If it were me, I would give him “a peace offering” of half the amount, not the full amount because he needs to take some personal responsibility for his misguided decision.
And I would make it clear that this offering is not an admission of guilt , but merely to offer ‘mercy’ as a fellow marketer. But, before I even sent that off, I would clear it with a lawyer to make sure that this cheque would not, in the law’s eyes, actually make me a guilty party. I may want to be merciful, but I must also use my own common sense to protect my business and reputation.
Second, to go above and beyond, I may offer to just write him a sales letter for his product. It seems like he wants to market this as an affiliate, but wants to differentiate himself from others by a unique sales letter. If I’m a good copywriter, it shouldn’t take me more than an hour to write it.
Again, I would make it clear, that this is a “donation” and I am not obligated to correct it according to his wishes, should he not like my sales letter. But, that I am doing this out of the goodness of my heart and to the best of my ability.
Third, I would make it clear on my webpage that when I endorse a product or a service, it’s simply because I had a good experience with it, and that if my readers take my recommendation, then that is their individual choice as part of a free society, so if it doesn’t work out, to not expect me to be responsible for what is their choice alone.
People and circumstances change. What may be a good recommendation today may not be so good tomorrow. That is the nature of change. And so, risk is part of life and it is part of a free society.
I would ask them if they would rather be free to take a risk, or not. As for me, give me liberty.
Remember, you’ll know you’ve made the right decision when you’re not anxious about your decision, when your gut tells you it’s right, according to Phil. 4:7.
God Bless,
Yvonne Amos
Good point… I agree that “gurus”, large list owners, and those with authority and influence have a responsibility.
Actually, by law you are right you are not liable to refund this customer. Besides, it would be inapproiate to refund him as he may take this copywriter to court and he may get a refund twice, but even if he dosen’t you made your recommendation in good faith since as a affiliate you got no commision the customer has no grounds to so you. I personally like you web site and will comtinue to support your services and advice. However, this does feed into some negatives comments about your services and recommendations when customers are taking your word on services you have recommended. Morally, you could refund this customer but you don’t have too. The real question is about your reputation. Is this a problem that will an adverse effect on your own reputation.
A good followup to the above comment regarding responsibility.
“ask the customer what he feels would actually be fair of you” – good idea
I believe you are NOT responsible for the customers refund, you acted in good faith in recommending the copywriter in respect to your good experience and can not be held responsible for that persons actions after the fact. I understand the customers frustrations at losing a hefty sum of money but ultimately he/she should have had sense enough to not have paid fully upfront. I’m sorry fellow customer but these things happen and we can’t just pointer the finger of blame at someone for our own mistakes.
There’s a copy of the sales letter in the PDF above. According to Dragutin, it is not relevant to his product. I’d be happy to hear [redacted]’ side of the story.
What I basically said is “[redacted] is the Walmart of sales copy. It’s not the greatest quality, but it’s decent, and he churns out a high volume of it for cheap prices”.
I did show some testimonials from [redacted]’ site though (hopefully they were real).
From what I have read, you do are not responsible to make a refund.
That’s essentially what I’m attempting to do through my video lessons.
haha 🙂
“The fact that you did not get paid is really irrelevant, as it was your intention to get paid when you made the recommendation.”
A very interesting point.
Eric, Over the past couple of years of trying to make it in this business, I have been sold, promised, hyped and lied too so many time I can’t count them all. So, what I started doing is my homework FIRST, before purchasing any product or service, I don’t care who recommended it. All Dragutin had to do was do a search on Google or IM Report card first. IM Report card has nothing on the copywriter, but Google on the other hand has a good deal of information. Some of this information would cause you to check this person out a bit further. If he did that and then made the decision to move forward, it’s on him. Unfortunately he did neither and moved on his own. I don’t have a problem with that, he relied on your one experience with the copywriter. Again I have no problem with him proceeding in this manner. Now here is where all common sense goes in the “crapper”, why on earth would you hire someone to do work and pay for the whole thing UP FRONT! I have always been told that there are two things in life that you cannot fight; ignorance and stupidity. In this case, I believe you are fighting with both.
Do you feel bad for Dragutin that this happened to him based on a referral from you? Yes of course you do. Do you owe him a refund for the work of some one else? No. If you feel like you would like to help him in some way, maybe you could assist him with his sales copy. This may be opening another can of worms altogether because I’m not sure he will ever be happy.
There is my take, for whatever it is worth. If you want to help him out in some way to make YOU feel better, then go ahead, otherwise; Dragutin, from now on take care of business in a business like manner
“how far should the chain-of-accountability be allowed to extend?”
Good question. I think that’s what the FTC is trying to address.
translation?
“I say go with your heart, and I get the feeling your heart says–give him the money he lost.”
I think my heart IS telling me to do something. I’m just not sure what yet.
“Is this a marketing ploy?”
No it’s not. I’m an opportunist at heart, and I saw an opportunity for a good blog post. But not a ploy.
I didn’t receive a commission for the sale though…
“ask themselves whether or not the problem actually presents a positive opportunity for them before they make their final decision.”
I do believe this will turn into a win/win, just not sure which path to take yet.
Kens Tips (Lesson 1)
Apologies for plagiarism!!!
This could be under discussion forever and a day. Let your concsience be your guide.examine it closely and I think that you will find that there is no case to answer
Carry on the good work
Kenneth
I’ve been following Eric’s site for some time now. The information provided in his posts are very helpful and to say the least, It helped me to take the plunge into a new venture. I have even purchased products through Eric that will hopefully assist in my streamlining activities.
So if I fail at what I’m doing, should I blame Eric ? I don’t think so, and I sure wouldn’t ask for my money back on the products I purchased from him if this venture does fail, which it won’t.
Now technically this is not exactly the answer to, forgive me, “The question” in question. Let me try to relate in another way.
Lets say my completely fictitious friend, we’ll call him Bob, refers me to a car lot to purchase a vehicle because he got a fantastic deal on a car and he loves it. I go to the same car lot to purchase a vehicle and decide to make a purchase, but then later find out that the car is not what I expected or even worse, a complete lemon.
Am I to blame my friend for sending me to the car lot ? I would say no.
If I had to take out a grievance it would more than likely be towards the car lot owner.
So my point is this:
People follow other people’s recommendations all the time, it’s a fact of life.
Whether or not you choose to act on those recommendations is a personal choice of yours and no one else.
In this specific situation I would have to say that Eric should not be held liable for the transaction because he acted in good faith without having knowledge beforehand of any suspected illegitimate activity.
P.S.- The website link isn’t finished yet, it’s still in progress!
Nice analysis!
Unfortunately your position of respect in the internet marketing community will have had considerable influence on his decision to use the copy writer. However it would be unfair for you to be held responsible for someone elses fradulent actions. All I would say is that if you profited in any way from the recommendation then the honourable thing to do would be give up that amount probably not as a refund but as a charitable donation.
“And “compassion” is a sword that could cut you to ribbons at any price and set a precedent that could cause a great deal of harm to not only you, but to others who are marketing on the internet.”
that’s what worries me.
“From reading the emails I wonder if English is the first language of either writer.”
I’ve wondered the same thing.
“You obviously feel something about this or you would not have brought it to such a public forum.”
Correct.
Thanks
Well give us your link then!
Hi Eric, You have nearly 600 responses on this issue in 2 days, as of now — WOW. That’s a lot of negative publicity for the copywriter — he’ll have to redeem his reputation, and quickly — he can pay back the entire amount or part of it, after negotiations. But his name is mud, anyway, after this blog post. Nothing he writes will be accepted by this client, perhaps. The client’s name needed to be disclosed too — is it Umberto Eco, according to your pdf file, or Dragutin?
If you were ‘going to’ receive an affiliate commission (even though you didn’t actually receive it) then, as a goodwill gesture, you could refund that amount to the reader who accepted your recommendation.
Otherwise, you are absolutely not liable to pay anything, for all the reasons already listed by other readers of your blog. Also, it is not your business/responsibility to arbitrate between the parties, or judge whether the client gave appropriate information in the first place — may be the pdf file you linked doesn’t have all the details. The letter Nick produced is very much a re-hash of scores of sales letters we’ve read, which have often inflated the perceived value of the product – but it would still have pulled in a lot of orders from newbies after it was appropriately completed with money-back guarantee etc. The DVDs that are sought to be sold (no disrespect intended to the motivational speakers) are not described too well either. So what would a copywriter have done? This mess reveals, if anything, a copywriter’s responsibility to understand the product and the mind/intention of his client better, and the client’s responsility for ‘due diligence’, and an affiliate’s responsibility to endorse carefully and disclose ‘material connections’ — a lesson for us all, as affiliates or if we engage a freelancer to do something for us.
In this case, the client can pursue his case before the appropriate authorities, or at least write off this ‘bad debt’ or ‘business loss’ in his tax returns, as suggested by another reader.
Zed Arya
You are not responsible, legally or morally. Paying this guy could expose you legally to other similar claims from other dissidents. If you do decide to pay him anyway, do so with the help of a lawyer who can draw up a gag order, stating that if this guy ever reveals to ANYBODY that you settled or paid him a dime, that he will be subject to immediate liability for $100,000 or more… and don’t you reveal to anyone if you paid him or not either. If you choose to buy into the ‘moral responsibility’ guilt trip, there certainly isn’t anything that says you have to reveal that fact to anybody else. These type of gag orders/clauses are routinely used when individuals or companies settle these kinds of disputes outside the courts.
No, the complaints came after the recommendation.
No I was not aware of the $1300+ deal that was made. I believe [redacted] was supposed to pay me about 20-30% commission. I do not have the exact #’s, because apparently [redacted] cancelled his 1shoppingcart account or something, because I cannot log into my affiliate account.