Better Business Bureau: Beware the “Amish” heater

On TV, they’re called infomercials, but in newspapers they look like news stories, with only fine print identifying them as ads. And they’re phony as a three-dollar bill or, in this case, phony as an “absolutely free” $2 bill, an “Amish” Heat Surge space heater, and an “armored safe.”

You’ve probably seen the ads. Minnesota Better Business Bureau’s communications coordinator says he’s “pretty comfortable saying that these ads have run in most (if not all) newspapers in our area (and, likely, the country) – and if not the full-page ads in the body of the actual newspaper, then in inserts (like USA Today and other inserts which appear in weekend papers).” The BBB denounced the ads this week:

“In our judgment, these problems have become so persistent and so flagrant we felt an obligation to alert the public,” said Dana Badgerow, President and CEO of the BBB. “Time after time, the BBB has expressed its concerns about the ads to the company. Time after time, the company has promised to make changes, only to come up with new ads that are just as troubling.”

Three years ago, a blogger on the Daily Kos dissected the phony claims for the heater. Across the country, other bloggers and reporters have done the same.

The heater, the “absolutely free” $2 bills from World Reserve Monetary Exchange, and the armored safes are all peddled by the Arthur Middleton Capital Holdings company in Ohio. They are overpricedunderperforming and deceptively advertised.

A blogger who calls herself Daughter Number Three has been writing exposés about the various products (state coins, weight loss programs … and the Amish Heater) for years. She explains how seemingly reputable newspapers end up running such completely disreputable advertising:

The ads are created by a business called Universal Media Syndicate, which specializes in buying up “remnant advertising” space from newspapers. Basically, they sign a contract with the papers saying they’ll buy any quarter-, half- or full-page ad spaces at rock-bottom prices. They’re the advertiser of last resort.

How does it work?

The papers’ ad departments have UMS’s insertion orders on hand along with advertising art for a range of questionable products …

Daughter Number Three reported that got threatening letters from a lawyer for Arthur Middleton Capital Holdings after her exposés ran. I bet they didn’t threaten the Daily Kos or Chicago Tribune or the Better Business Bureau.

Last year, MinnPost’s David Brauer wrote about newspaper advertising standards (or lack thereof) and the Amish Heater-Universal Health Card- MiraCool-et cetera scams.

After all these years and all these exposés, the company keeps selling the products, and newspapers keep running their ads. You can do three things about it. First, don’t buy the HeatSurge, the CoolSurge, the state coins, the Universal Health Card, or anything else that sounds too good to be true. Second, forward the Better Business Bureau warning (press release below) to your elderly parents, your gullible brother-in-law, and anyone else who might be taken in by the ads. And third? The next time you see one of these ads in a newspaper, write to the editors and tell them what you think of it, and what it makes you think of the newspaper.

BETTER BUSINESS BUREAU PRESS RELEASE

Contact: Dan Hendrickson, Communications Coordinator

651-695-2463 / dhendrickson@thefirstbbb.org

BBB Cites Arthur Middleton Capital Holdings For Deceptive National Advertisements

Saint Paul, Minnesota – November 30, 2011 – An Ohio company that markets products ranging from portable electric heaters to uncut sheets of U.S. dollar bills is under scrutiny for what the Better Business Bureau of Minnesota and North Dakota (BBB) calls “significant and ongoing concerns” over advertisements which the BBB believes have the capacity to mislead consumers. The company, Arthur Middleton Capital Holdings of Canton, Ohio, is best known for its full-page ads in newspapers and magazines that appear similar to news stories and which run in publications in Minnesota, North Dakota and nationwide.

“In our judgment, these problems have become so persistent and so flagrant we felt an obligation to alert the public,” said Dana Badgerow, President and CEO of the BBB. “Time after time, the BBB has expressed its concerns about the ads to the company. Time after time, the company has promised to make changes, only to come up with new ads that are just as troubling.”

Most of the BBB’s concerns involve ads for World Reserve Monetary Exchange and Heat Surge, businesses that are part of the Arthur Middleton holding company. The BBB has logged 207 consumer complaints involving World Reserve Monetary Exchange and 258 involving Heat Surge. Many complainants said they found the company’s ads misleading.

World Reserve Monetary Exchange sells coins, paper currency, safes and related items and describes itself as “the largest provider of coin and currency aside from the U.S. Federal Reserve.”  Heat Surge is best known as the seller of Roll-N-Glow electric fireplaces, with Amish-built mantles.

Among recent ads targeted by the BBB are:

  • World Reserve Monetary Exchange ads for uncut sheets of $1, $2 and $5 bills. The $1 and $5 bill ads have run in recent months in area publications. The BBB considers the ads confusing and highly misleading. In December, the BBB of St. Louis alerted the public to World Reserve ads for “absolutely free” $2 bills, noting that the only way to get those four “free” $2 bills was to buy 12 additional bills at a cost of nearly $160.
  • A World Reserve Monetary Exchange ad for armored safes that ran this summer in newspapers and magazines. The BBB considers those ads exaggerated and misleading and noted that two testimonials – one by a man who turned out to be a company official and a second by the brother of Arthur Middleton’s owner – may have violated Federal Trade Commission truth-in-advertising guidelines by not revealing their ties to the company.
  • A Heat Surge ad that has run in recent weeks in various publications around the country and which claims to be a “revolutionary breakthrough in home heat technology” that “practically eliminates high heat bills.” The ad imposes a 48-hour deadline for ordering, saying “if you miss the deadline, you’ll be turned away and forced to wait for future announcements.” The ads do not disclose that the company’s heaters are available at about the same price online or through department store retailers.

The recent ads for sheets of uncut $1 and $5 bills contain what appear to the BBB to be several misleading statements.  Each of the ads strongly suggests that the bills will increase in value when, in fact, there is little likelihood of that.

“Just think what they could be worth some day,” the ads say. “Rare uncut sheets of real Gov’t issued currency have sold at prestigious auction houses for thousands of dollars.”  The ads also claim that the offer is limited to a specific geographic area when that is not the case.

“Residents whose zip code is not on the distribution list can’t have our Vault Stacks of these full uncut sheets of $1 bills,” another ad says. The $1 bill ads quote a company official identified as Jefferson Marshall as saying that callers will be able to buy the uncut sheets of bills “for just face value.”  That is not the case.

In August, the BBB notified Arthur Middleton about concerns over what appeared to be misleading information in its armored safe ads. Those ads contained a warning that a toll-free hotline to obtain one of the safes would close within 36 hours, giving consumers a false sense of urgency. A BBB investigator called the hotline number three days after the deadline and found the line still active and a company representative eager to sell him a safe.  The only difference was that the buyer would no longer get free shipping.

Monica Wallace, an attorney for World Reserve Monetary Exchange, said company officials acknowledge concerns regarding the testimonials of the company employee and the company owner’s brother and promised to make changes in future ads. She also said a proclamation that the bag of coins is “like winning the lottery” is intended as a “gross overstatement” since it is “mere puffery and not likely to be interpreted literally.”

The BBB of St. Louis met on Oct. 10 of this year with John Armstrong, senior vice president and general counsel for Arthur Middleton, regarding its advertising claims. Armstrong said the company will continue to monitor its advertising for potential problems and asked that BBB concerns continue to be brought to the attention of the company.

Armstrong supplied the BBB with testimonials from satisfied Arthur Middleton customers.

Following is a link to several recent Arthur Middleton Ads: http://bit.ly/rtpylh.

Consumers can learn how to protect themselves or find BBB Business Reviews of businesses or charities by calling (800) 646-6222 or by visiting www.bbb.org online.

# # #

The mission of the Better Business Bureau is to be the leader in building marketplace trust by promoting, through self-regulation, the highest standards of business ethics and conduct, and to instill confidence in responsible businesses through programs of education and action that inform, assist and protect the general public. Our hours of operation are 8 a.m. to 5 p.m. Monday through Friday. Contact the BBB at www.bbb.org or 651-699-1111, toll-free at 1-800-646-6222.

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