After accusations of adopting a “pay to play” marketing plan, the Better Business Bureau said it will consider making changes to its letter grading system which has been criticized as a means to pressure businesses to become dues paying members. It did not provide specifics.
“Over the last few days, the core foundation of the Better Business Bureau’s value to consumers and businesses has been questioned. It has been pointed out that some of our practices have not measured up to the standards consumers and business owners expect from the BBB, and for that I want to apologize. We can and will do better. To that end, we have called a special session of our Executive Committee to convene this Tuesday, November 16, to discuss and take corrective action,” Steve Cox, president of the 120 chapter BBB council said in a statement tonight.
“While we want to recognize our shortcomings, any attempt to question the integrity of the entire BBB organization is completely and totally without merit. BBB has been the standard for marketplace trust. We have an uncompromised commitment and resolve to protect the general public and promote ethical business behavior. We do that through many services, including our business ratings and BBB Accreditation of businesses, which are designed to help consumers identify trustworthy businesses,” he said.
The BBB has been the subject of criticism from me and other consumer advocates and some businessmen after it changed its 95-year satisfactory/unsatisfactory rating system to letter grades that range from the low F to the high A+. Only accredited BBB dues paying members can get the A+ ratings.
For more than a year I and other journalists have been pointing to ratings that don’t make any sense and seem to back up criticism that it was instituted to pressure businesses to pay anywhere from a few hundred dollars a year to millions to become accredited members.
The BBB claimed that its ratings were solely based on thorough checks of businesses and money did not influence their decisions.
However, a group of California businessmen working with blogger “Jimmie Rivers” showed how hollow those promises were. They created fake businesses, including Hamas named after the terrorist organization, and the BBB immediately gave it an A- rating after a $425 payment was made.
Hamas A- rating
"Jimmie Rivers" shows ABC the Hamas listing on BBB
On Friday, ABC TV’s 20/20 program showed devastating videos of two California businesses owners who had average ratings but were immediately given the coveted A+ ratings after turning over their credit card numbers to become dues paying members. One complaint against one of the firms that was on the BBB website disappeared.
“In some of the examples cited by the media, we didn’t get it right. We are looking into these specific incidences. We owe it to the public to get it right every time. We will work diligently to achieve that goal,” Cox said in his statement.
His statement however listed no specifics on what the BBB would do nor did he explain why he ended his interview with ABC early and refused to answer all their questions.
It appears that Cox and other BBB officials are trying to lay all the blame on the Southland, Ca., BBB chapter, the largest in the country, whose president has the highest salary within the BBB system – $400,000 a year.
However, while most of the outrageous incidents took place in Southern California, it was that chapter that came up with the idea for the rating system and it tested it for several years before the national council adopted it – and threatended five chapter that did not want to use it with expulsion.
By blaming one chapter the BBB is also avoiding the larger issue that the rating system cannot have any real validity because the chapters do not have the staff or the expertise to accurately grade millions of businesses, handle more than a million complaints a year, and conduct what it claims 20,000 investigations into false business practices and scams.
There have been many cases of ratings across the country which only make no sense.
For instance, Starbucks HQ in Seattle is not a BBB accredited member and has an F rating.
In Connecticut the University of Bridgeport has a B rating while Yale University has an F rating. Neither are accredited members.
I would love an explanation of that.
Steve Cox doesn’t get, and probably never will. If those were isolated incidents, sure the accusations have no merit. But there are thousands of business in their database rated “C” and lower that have had 0 (zero) complaints during the last 36 month. How can you get a C with zero complains???
The problem is that he does get it
Too little too late. Steve Cox should resign. This will be the first step that perhaps will begin restoring consumer confidence in BBB.