Three companies involved in the Acai Berry scam whereby customers were enticed into signing up for a ‘free trial offer’ of health supplements have been forced by British courts to cease trading. Customers ordering products including Acai Berry Detox, Life Cleanse and Resveratrol were duped into believing that the only cost to them was a modest postage and packaging fee, typically £3.95 for the trial period. However, after failure to cancel within a very short cancellation period, usually 15 days, customers were forced to pay on average £70 to £80 per month for the product.
The extensive investigation found that all of the companies involved in the scam were under common ownership in Malta. During the period March 2009 to November 2009 they dealt with 947,000 customers and stacked up orders in excess of £25 million. The companies were shut down due to many breaches of an ethical trading standard but primarily because the websites mislead customers into believing that the trial offer was risk free and restricted in its duration. In addition the terms and conditions were designed to deliberately mislead and credit and debit card charges were made in 23 different trading names in order to cause further confusion. Moreover, the length of the trial period was not made clear with an unreasonably short window in which they could cancel the product subscription.
Mr Alex Deane of The Insolvency Services’ Company Investigations quoted as saying: “Companies using deliberately misleading offers for financial gain is serious misconduct and it undermines the confidence the public have in business. I hope the action taken on this matter sends a clear and simple message; if you set out to defraud you will be closed down.
“This action should also serve as reminder to anyone interested in signing up for a ‘free with postage and packing’ offer, if it seems to good to be true, it usually is. Always check the validity of any company that requires your personal banking details and quickly inform your financial provider if you notice any subsequent unusual activity.”
The companies in question, Trading Planet Limited, Vivera Limited and Viv3lab Limited, were found to have failed to maintain proper accounting records, operated with a lack of transparency and failed to cooperate with the investigation. Furthermore, the Maltese parent company provided no evidence to reinforce its claims that it was merely acting as a third party payment processor.
The accusations against Trading Planet Limited were made on 27 January 2010, with provisional liquidation beginning on 5 February 2010 and final permanent liquidation was enforced by the High Court on 9 April 2010. Similarly, Viv3lab Limited and Vivera Limited faced petitions against them on 4 March 2010, went into provisional liquidation on 5 March 2010 and were finally fully liquidised on 22 and 23 March 2010 respectively.
The message is clear from the UK Insolvency Service: Companies deliberately misleading customers and lacking transparency will not be tolerated and will be shut down without delay.
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