Investor Alert: Is Masterworks.io a scam?
Every once in a while, someone decides to sell shares in “something” new. Today, that something is Fine Art. Let’s explore the pitfalls of investing in this idea.
Investing in Art
Purchasing art has always been about buying a single piece of artwork outright. Meaning, you find a piece of art you like and you buy it. That means that piece of art is yours to display in any way you wish. This type of purchasing of art is (and remains) the most optimal way to purchase art. You buy it outright and you own the entire work in totality.
However, there are exceptions to the above. If you purchase a reproduction of an original work of art, this purchase offers much fewer rights to the buyer. Some rights that you forfeit when purchasing a reproduction include reproduction of that art. Meaning, you can display your purchase in any way you choose, but you cannot photograph it and/or sell photographs of that art. The reproduction rights remain with the original work’s owner. Only the person who owns the original artwork may reproduce the work in any way.
Mass Produced
You may be thinking, “But, mine is painted with real paint on real canvas”. That doesn’t matter. What matters is if the painting is the first and the original. Many painters reproduce their works using paint on canvas, many times over. Typically, these reproduction paintings are painted by employees (in a sort of paint-by-number situation), but is not always painted by the original artist. These are painters hired for the sole purpose of creating a copy of the original. These reproduction paintings are sold typically at a fraction of the original art’s cost. These reproductions rarely become valuable simply because of the total number produced. It’s the same reason why many mass produced items rarely go up in value.
Because the original was painted by the actual artist, this original painting is the one that holds value. That’s not to say that every original painting by every artist will increase in value. Many do not. It depends on the artist, the artwork and that artist’s contribution to the art world. Perhaps in time that artist might be seen in some kind of historical light, thus propelling their artwork values upward.
Because an original art piece might spawn many “authorized” copies, copies that could become very popular in sales, that makes the original work much more valuable. For example, an original Thomas Kinkade painting would be worth far more than one of its many reproductions. That doesn’t mean reproductions can’t increase in value, but they will never be valued the same as the original first painting.
Masterworks.io
Masterworks takes the idea of Fine Art to an “investment” level. By that I mean instead of owning the actual painting / art piece in full, you only own a “share” (or small portion) of the art. In reality, this type of investing is an abstract concept. At the moment, Masterworks appears to focus solely on paintings. You might be wondering, “How does owning a small piece of a whole actually work?”
The short answer to this question is that it doesn’t. Investing in a tiny piece of a valuable work of art doesn’t do anything but ultimately make Masterworks as a company rich. You, in fact, don’t own anything but the knowledge that you “might” own a small piece of a work of art. You also own the knowledge that that investment might, maybe return value IF the painting is (eventually or ever) sold at a profit. In essence, you’re essentially placing a long shot bet that eventually that painting might be sold for a profit.
Let’s understand some of the problems with this idea.
Where is that painting?
Good question. If you’re buying into an investment object, you definitely want / need to know exactly where that “object” is physically located in the world. If you invest in a company, for example, you know where their headquarters are. You know who their executives are. You know their physical address and phone number. You can call and talk to someone. You can even find out their sales plans, the products or services the company sells and how much they make in revenue per quarter. Keep in mind that some private companies may be unwilling to disclose their sales numbers. With public companies, that company’s revenues are public knowledge.
Buying into a Masterworks painting, on the other hand, you don’t know exactly where it is. You don’t know under what conditions it’s being stored. You don’t know who currently has possession of it. Masterworks can “assure” you that that item is safe… but is it? Paintings are particularly susceptible to deterioration if not kept under the strictest of environmental controls. Artwork is also susceptible to theft. Both of these issues are difficult to manage at the best of times.
One might think that paying to invest in small bit of a painting might help protect it from being lost to time. It’s a lofty ideal. It’s, unfortunately, an ideal that when considering the underlying logistics of it all, make the investment seem highly risky. It’s also an ideal that may not hold true.
An investor should always ask, “Who owns the original work?” You must also consider the following:
- Is Masterworks attempting to sell shares in art they don’t legally own?
- Is Masterworks actually in possession of the art they claim to have bought?
- Did Masterworks actually buy the painting or is it under some kind of “lease”?
- Is the art being stored in correct conditions?
Who knows for sure? These are all very good questions. They’re also questions that should greatly concern you when considering “investing” in art through Masterworks.
Paintings as Investments
Art is entirely subjective to every person, but it is also highly volatile in its salability. What I mean is that paintings, particularly abstract paintings, go through ebbs and flows, waxing and waning in popularity and, yes, value. What might seem like an excellent painting today may be seen as outdated and worthless next year. Art’s value comes and goes, sometimes as a result of changing style trends. Painting values are, as I’ve said above, highly volatile. Way more volatile than investing in company stocks, bonds or even precious metals.
Sure, this investment type is yet another “thing” you can put some money into as part of your larger investment portfolio and hope to see a return on investment, but it may not return anything. The problematic issue with this concept is, can Masterworks be trusted or are they simply another Bernie Madoff? This is the ultimate question.
Novel Concept, Poorly Realized
The idea of share investing in art is definitely novel, even Masterworks states as much. However, is it realistic?
First, there’s the idea that you only own a tiny fraction of a painting. How does that work anyway? Are they planning on cutting up the piece of art if the art price bottoms out and there’s nothing left to pay you back your investment? Clearly, no. They’re simply going to tell you that you’re out your money and they STILL get to keep that art even if it’s worthless. Not only do you NOT get the art after investing, you don’t get your investment back if the painting is sold at a loss.
Second, there’s the logistics of where this art is stored. You have no idea as an investor. Unless Masterworks intends to spend boatloads to create a location to store all of this art under perfect archival environmental conditions (highly unlikely) AND they can prove that fact to investors, the art is then completely open to deterioration, decay and possibly destruction or even theft. Some art, in fact, may be produced using non-archival media. This means that no matter how well a piece of art is stored, it may still slowly (or quickly) deteriorate to the point of no longer even being art (or saleable) even within a few months. You can’t stop deterioration, which actually makes some art less valuable every day that passes.
Third, who actually owns (and holds) that art? Are art owners selling the full piece of art, selling it under consignment or are they selling only the concept of ownership as shares, so then Masterworks then manages that “concept trust”? If Masterworks is selling shares in works of art they do not rightfully own and possess, that is very close to a Ponzi scheme. It may also be very illegal. That’s like someone claiming to sell you the Brooklyn Bridge. Sure, anyone can claim to sell it, but they do not own it. They do not even own a piece of it. Giving money to someone claiming to sell you the Brooklyn Bridge is, thus, the very definition of a scam and fraud. With Masterworks, be very careful.
Masterworks needs to also be very careful in what they are doing, making sure their ‘i’s are all dotted and their ‘T’s are all crossed.. Here’s what Masterworks has to say about their own model and art investing:
‣ We have a novel and unproven business model.
https://www.masterworks.io/
‣ Masterworks issuers do not expect to generate revenue, so investors will only recognize a return on their investment if the painting is eventually sold at a profit
‣ No market exists for the shares and paintings are highly illiquid, so you must be prepared to hold your investment for an indefinite period.
‣ Each Issuer owns a single painting and this lack of diversification magnifies risk.
‣ Your ability to trade or sell your shares is highly uncertain.
‣ Paintings may be sold at a loss.
‣ Costs will diminish returns.
‣ Investing in art is subject to numerous risks, including (i) claims with respect to authenticity or provenance, (ii) physical damage, (iii) legal challenges to ownership, (iv) market risks, (v) economic risks and (vi) fraud.
‣ Issuers are totally reliant on Masterworks.
‣ Masterworks has potential conflicts of interest.
‣ Timing of sale of a painting is uncertain.
None of the above (or even their web site) describes how or where the art is actually stored or maintained. It almost solely discusses the risks of investing. The fact that Masterworks also finds the need to call out that purchased shares are “illiquid” says a great deal here. This word means that there are few participants, thus low volume, which ultimately means a very low chance of ever being able to sell out of purchased shares.
Consider stocks and bonds. You can likely sell out of any of these positions in about a day. With Masterworks investments, the low volume and few participants means once you invest, you’re likely stuck holding onto that investment until the painting either sells (at a loss or profit) or fails to sell at all. Masterworks doesn’t really state what happens if you can’t sell your position with a painting that never sells. I guess you’re ultimately out your investment money.
Art Storage
As with any artwork and has been stated above, it’s important to understand how and where the art is stored and who actually owns the art. None of this is explicitly stated on Masterworks’s site. I’m actually taken aback by the fact that for all the deluge of investing information provided, there’s equivalently a severe lack of information regarding the artwork itself, where it’s stored, how it’s managed or who owns it while it’s being held for shares. That’s a big, nay HUGE, problem in my book.
However, Masterworks does say this…
What this ultimately says is that Masterworks locates and purchases art. It doesn’t exactly state what “purchase the work” actually means. Are they taking possession of the work or are they leaving it at the gallery where they found it to remain on sale? They do claim to hold a work of art for 3-10 years. I’m uncertain how this works exactly considering the second half of that “OR” statement. Only questions, few answers.
As I said, for as much information as there is about risk of investing, there’s equally as little about the actual artwork itself… which is huge red flag 🚩.
Any business straddling both the art world and the finance world should be, at once, both engaged in explaining how and where the art is to be stored and handled, but also able to explain the risks of investing. Clearly, Masterworks is only interested in documenting half of this equation.
Volume Investing
Masterworks hopes that as more people jump on board with their share idea and begin investing, a larger and higher volume share marketplace will eventually emerge to allow for easier share trading. At this moment, however, Masterworks has stated that any position you buy is likely to be “illiquid”, thus implying that this is a new market with limited options for selling shares.
In other words, if you invest $100 into a painting and gain 2 shares, those shares in that painting are most likely to remain yours until the painting sells at a profit or a loss. The question is, though, even if the painting sells, does Masterworks have the painting to sell? I’m still skeptical.
Art Galleries
Masterworks, as a company, needs to be a whole lot more forthcoming about all aspects of its business operations, especially surrounding where, how and who stores the art after it’s purchased.
What Masterworks should have planned for is purchasing a number of galleries around the United States (or around the World) to support their business model. Instead of simply attempting to sell the investment share idea, they should have worked this idea full circle.
Here’s where things get a little dicey for Masterworks. Instead of creating a complete sales cycle (or sales funnel as some might call also it), they leave out one very important piece: Galleries. Clearly, they have Acquisition, Investments and Sales. Though, questions about Masterworks’s acquisition process remains, primarily because they don’t have galleries.
To really make this business model complete, Masterworks needs to own and operate its own set of galleries. Why galleries? Owning galleries sets a tone that you know how to properly store and manage expensive artwork in addition to offering a place to actually sell it properly. Though, paintings can be sold through auction houses as well. Masterworks is attempting to sell art for millions of dollars, yet Masterworks doesn’t really state where, or more specifically how, that artwork is managed and stored. It’s an important and necessary piece that’s conveniently missing.
Owning galleries keeps Masterworks honest and allows for auditing. If there is a gallery where a specific investment work lives, investors can visit the gallery and physically see the art they have invested in. This verifies that the artwork exists, that it is genuine (not faked), that it’s in Masterworks’s possession and that it can be verified. Without this piece, verification of the actual art remains an open question. Images on a web site do not verify that anything is genuine. Talking to someone on the phone doesn’t verify authenticity either. Only physically seeing the artwork in person can an investor verify the painting and, thus, verify that their investment is backed by something real.
Questions without Answers
That leaves too many open questions. Questions like, “What exactly am I investing in?” Like, “Where is the artwork stored?” Questions like, “Is the artwork properly stored for a long sales wait?” Like, “Is the artwork in the possession of Masterworks directly?” All of these questions could be easily resolved if Masterworks owns and operates a set of galleries… or at least a showroom at the bare minimum.
Additionally, with Masterworks ownership of galleries, this means you, as an investor, can physically go see the art you’ve invested in. You can see if it’s as it appears in the images. You can see it on exhibit, or at least it can be brought out for a viewing. You can see that it’s being kept and stored in appropriate environmental conditions.
There are so many questions surrounding the art itself, there is absolutely no way I would recommend anyone to invest in Masterworks… unless you absolutely like throwing money away on odd “investment” strategies. Knowing where that art is, how it’s being stored and if it’s being stored appropriately combined with knowing you’re able to view the actual art is extremely important BEFORE investing any money in a share of a painting.
Ponzi Scheme?
While I previously made reference to Bernie Madoff and his ponzi scheme, that statement isn’t intended to suggest that Masterworks runs a Ponzi scheme or that it intends to make off with your money. However, because of so many lingering questions, this business model seems unnecessarily risky… especially not knowing the answer to far too many questions surrounding the paintings.
Additionally, because of the volatility in art sales, as an investor, you must fully trust and be reliant on Masterworks buyers and appraisers to locate “valuable art” that might sell for some amount of money higher than what was paid. However, you’ve no idea if the art they’ve selected will actually sell at all. Because art is so subjective, what a few like, too many others may hate.
It also means betting that some nebulous “whale” will come along and snap up that piece of art (for millions) you just so happen to have invested in. That isn’t likely to happen often. Unless the art is of great historical value (i.e., Leonardo DaVinci or Michaelangelo or even more recent artists like Mark Rothko, Roy Lichtenstein or Marcel Duchamp), art produced by artists living and working today might fetch random amounts, but perhaps not millions. There’s just no way to know what any piece of art might fetch when produced by today’s artists. It’s all a calculated, but a seriously risky best guess.
Unfair to Artists
One thing Masterworks also seems to be attempting is to force art to be sold at far higher prices than it’s actually worth. This is what many collectors attempt to do, usually via auction. That is, Masterworks appears to intend to artificially inflate art prices to make better returns on shareholder investments. The difficulty is that this artificial inflation (nor does the sale itself) benefit the artist at all.
Where Masterworks might “buy” a work for $70,000 from an artist via a gallery, they may attempt to turn it for $1.3 million. That nets a huge profit for Masterworks and a lesser amount for shareholders in that work. However, for the artist, $70k is all they have received. The artist is not fairly compensated from a Masterworks sale.
One might argue that aftermarket sales of art never has benefited the artist. Yes, but here’s a business model that could arguably help bring artists into the fold by making sales on behalf of the artist. This goes hand-in-hand in owning galleries. Instead, it seems Masterworks has chosen an aftermarket sales model that excludes the artist. A model that only makes money for investors and Masterworks, but not for the artist. Intentionally leaving the artist out of this process is entirely greedy and unfair to the artist.
Artists Deserve Compensation
One might think that $70,000 is a lot of money for the sale of a painting. It is. But, it is nowhere near the amount that the artist could have netted if they had sold it for $1.3 million.
Artists shouldn’t be required to invest in their own paintings with Masterworks just to net more profit on an aftermarket sale. Instead, Masterworks should work directly with artists to list the work and then compensate the artist for at least 50% of the sale, either directly or by issuing a 50% ownership stake in the art via shares. The rest of the profits should go to paying out shareholders. This model would not only fairly compensate every artist, but it also fairly compensates the shareholders and Masterworks itself.
Artists are always the one who seem to get the shaft. This problem has existed for many, many years. Masterworks can modify their business model to make sales that directly benefit the artist while also properly compensating shareholders and turning a nice profit for Masterworks. Instead, it seems they have ignored this aspect only to make their sales benefit mostly Masterworks executives the most, leaving out the artist.
Artists vs Corporations
If you’re of the mindset that you would like to see artists fairly compensated for their work, skip these risky investment schemes and buy directly from an artist. If you buy directly from an artist, you are helping that artist, not some random corporate executives operating a more or less faceless and questionable company. If you’re willing to shell out $20 to see a movie actor perform, then why wouldn’t you be willing to pay an artist for the artwork they produce?
Not only can you carry pride in the fact that you purchased art directly from the artist, you also own an original work of art in full, not solely just a share in a work of art that you’ll never see. You can also hold pride in knowing that you have helped the artist produce even more work. Buying art from Masterworks does not, in any way, encourage artists to continue to their craft. In fact, the pittance that the artist might receive in the first sale may be barely enough to cover the time and effort put into producing that painting let alone help them produce future paintings. Art supplies are expensive.
Art Valuation and Secondary Market
Let’s talk about the investing and trading pieces. Masterworks operates a secondary market where shares can be traded. Unlike Wall Street stocks where a stock’s value is based on such fluctuating data points as company profits, company revenue, investor calls, product sales and announcements, analyst recommendations, investor confidence and volume of trading, paintings have no such intrinsic back end data points (other than perhaps trading volume… and even that is drummed up via this questionable investment scheme).
Art valuation is entirely subjective, made solely by a random person appraising its value. What that means is that if you invest in a work that claims to have a $30 “share price”, you’re at the mercy of an appraiser to raise or lower this price. Bid and ask sale prices might influence pricing some, but the pricing seen on the secondary market site is mostly “best guess”. There’s nothing behind that painting to “prop up” its changing value. There are no profit margins, no new product announcements, no analyst calls, no company books to review, nothing. It’s a painting. That’s it. Paintings don’t randomly change value UNLESS they are sold. Anything else purported is a dubious scheme.
Investing in a painting with a fluctuating value is a false equivalence to stock. There’s nothing there to change the value of the share in a painting, yet it seems that the values do change. Why? The painting hasn’t yet sold, so it makes zero sense. As I said, there’s nothing in any painting to justify changes in the share price until AFTER it’s sold. Once a painting has been sold, then the share price will change to reflect the sale price of the painting.
If Masterworks intends to see a painting’s share price fluctuate daily, like stocks, then there’s something seedy, dubious and awry going on. It’s also something that you as an investor need to understand before investing a cent. Intraday changes in painting’s share price prior to a sale is extremely dubious.
One might argue that there are a limited number of shares in the painting. That each share sold makes every share more valuable. I might be willing to accept that argument except a painting can be arbitrarily divided 100 times, 1,000 times or even 1 million times. When does that share division end? You can’t really divide a painting up like that. If you’re going to apply a random investment concept, such as a share, onto a painting, then any division into shares is entirely arbitrary and disconnected and holds effectively a fractional value tied to the current “worth” of the painting. Ultimately, there’s only one (1) painting. Therefore, there should only be one (1) share. When you buy that one (1) share, you buy the painting.
Having this sub-construct of many shares which are separate from the “painting as a single commodity” is not only an odd concept to apply to a physical object, it might be seen as a form of Ponzi scheme. These “shares” are actually an abstract idea applied to a single physical object which cannot be subdivided physically. So, how exactly does this abstract division concept work? That’s exactly what Masterworks is attempting to find out. It’s also why the Masterworks business model is unproven.
Overall
I can’t recommend investing “shares” in paintings via Masterworks for reasons already outlined above. However, let me summarize these points:
- Proper art storage isn’t explained (very high risk)
- Returns on investment isn’t fully explained (high risk)
- Paintings aren’t guaranteed to sell (high risk)
- No sales benefits given to the artist (problematic)
- No galleries to physically view or confirm ownership (exceedingly high risk)
- Art prices are highly volatile (high risk)
- Art sales are solely dependent on subjective criteria (overly risky)
- Art values are solely dependent on Masterworks “appraisers” (highly risky, requires high trust)
- Intraday changes in share prices are nonsensical prior to the painting being sold (dubious)
- Must trust Masterworks for both valuation and truth (overly risky)
- Must trust Masterworks that they actually own and possess the art (exceedingly risky)
- Secondary market attempts to treat shares in a painting like stocks (exceedingly risky & dubious)
Without seeing the painting physically, as an investor, you have no idea if Masterworks truly has that painting in their possession. It’s easy to take a picture and put it on a web site, making claims that they own and possess the work. This then tricks the investor into a purchase. Then, you hold and hold and hold and the painting never sells. In fact, you could come to find they don’t even own the original art. You might find that they’re selling something they don’t even have possession of.
While Masterworks may own some of the work they claim to own, there’s literally no way for an investor to confirm that every piece of art listed is actually in the possession of Masterworks. This problem is exacerbated mainly because Masterworks operate no galleries.
For this reason, Masterworks could be selling you shares in a work that they do not, in fact, own or possess. That’s effectively a form of fraud.
Masterworks would do best to modify their business model to offer a process that can prove they physically own the paintings they claim to own. The only way this is really possible is if they open and operate at least one Masterworks gallery somewhere so shareholders can visit and request a viewing of the art they’ve invested in. This is effectively an audit system which holds Masterworks accountable to all shareholders. Without this change in their business model, investing in any work that Masterwork claims to own is unnecessarily risky. To anyone willing to give money to this company, I say, “caveat emptor!” Let the buyer beware.
Without such basic investor auditing responsibilities, I strongly recommend staying away from this novel, but highly problematic investing concept and stay away from Masterworks as a corporation. That’s not to say this concept can’t be revised to be more functional, but at the moment this concept is just not there. This concept forces an over-burdensome amount of trust and risk onto the investor and off of Masterworks, while leaving too many unregulated, unauditable and manipulable pieces in the hands of Masterworks executives.
Bottom Line: If an employee at Masterworks wished to game the Masterworks system, the lack of proper auditing over this concept would allow any executive far too easy access to game it… thus losing investments from investors and truly turning this into a huge fraud scheme.
Business Concept: B
Business Execution: F+
Scam Risk Level: Exceedingly High, Stay Away
Recommendation: Don’t Invest in Masterworks
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Review: Is Fiverr a scam?
Fiverr is one in a new generation on “Work for Hire” sites (sometimes known as freelancer sites) that have recently sprung up, while they’re also hoping to turn a big profit off of the backs of buyers and sellers. Let’s explore whether Fiverr is a scam or legitimate.
Work For Hire
While Fiverr might think it is something kind of special, it isn’t. There have been plenty of “Work For Hire” kinds of sites throughout the years going back to the early 2000s. There’s nothing really new about this kind of site.
To explain more, Fiverr’s “Work For Hire” marketplace has two distinct type of visitors: Buyers and Sellers. This means that a person visiting the site could be one or both of these roles.
As a buyer, you visit the site looking for a specific kind of service to buy. For example, maybe you would like to have someone write a blog article for you. You can then find an author/seller who is selling such a service, then contract their services at an agreed price, place an order, then wait for delivery of the article… at which time payment is due.
As a seller, you use your talents to place your authoring services up for sale and reap monetary rewards (such that they are) for providing a needed service to the buyer community.
It’s a reasonable idea and a potentially great business model, if such a site is correctly designed. Here’s where Fiverr fails hard.
Buyers
As with any site of this type (or really any site in general that offers logins and passwords), certain expectations are set (and must be met). Any site with user logins must be willing to maintain and manage these user logins themselves, including appropriate application of Terms and Conditions by taking action against violators, abusers, harassers and scam artists. After all, it is Fiverr’s servers and system, therefore it falls on Fiverr to ensure users of the service act according to the Terms and Conditions while using that platform. This is a very basic expectation that all sites must meet.
For example, when you create a Google account, there’s an expectation that Google will both vet and maintain its new user signups appropriately. For the most part, Google does this well… except when the individual is under 13 years of age. That means that when Google identifies someone violating its rules of conduct (usually laid out in Terms and Conditions and/or Terms of Service documents or possibly other documents also), it will take action against a violating account up to and including termination from the service. However, Google has refrained from either detecting or deleting accounts created by users under the age of 13, for whatever questionable reason. I digress.
Along these same lines, Fiverr’s management is not only exceedingly naïve, they’re extremely inexperienced in running a user signup based platform like Fiverr and it shows. Why? Because the site’s weak signup system and rigid Terms and Conditions forces far too much of Fiverr’s buyer vetting work down upon its sellers. Instead of taking care to properly manage its buyers, it forces sellers to shoulder that responsibility and take this work onto themselves. As someone so rightly said, “Ain’t nobody got time for that”.
Sellers
As a seller, you would think that your primary job and focus is to sell your service to would-be buyers. While that is a portion of what a seller is expected to do on Fiverr, Fiverr’s unreasonable and overreaching Terms and Conditions require the seller to take on a whole lot more burden than they should, such as Buyer vetting, Buyer management and, yes, being “Academic Police”.
One egregious mistake in Fiverr’s Terms and Conditions is its overreaching “Academia” clause. One might think, shouldn’t we protect academic institutions and/or students? Well, no. Academic institutions are responsible for protecting themselves. Students are responsible for protecting their own best interests. It’s no one’s responsibility to protect any specific academic institution or student than that academic institution itself.
How does this impact sellers? Great question. Let’s get started answering this loaded question. There are 3,982 degree-granting institutions of higher learning as of 2020 according to US News. Nearly 4,000 institutions exist…. 4,000! That’s a lot.
This number is important to realize because Fiverr’s Terms and Conditions require sellers to become “academic police” for each and every one of those nearly 4,000 institutions of higher learning. Oh, but it gets so much worse.
Every single one of those institutions has by-laws and rules regarding code of academic conduct. Students attending are required to agree to that code of conduct upon enrolling in any one of those institutions. For example, rules against plagiarism is a typical code of conduct which may be found at many, if not most, of these institutions. It is beholden to the student to read, comprehend and understand this code of conduct for their specific institution upon enrollment.
However, for sellers on Fiverr, Fiverr’s Terms and Conditions effectively deputize sellers to become “academic police” for any or, indeed, all of these nearly 4,000 institutions of higher learning. This means that should a buyer show up at your seller doorstep, you must become responsible to make sure that buyer (who might be a student) isn’t violating a university’s academic code of conduct by buying something from you.
Not only that, Fiverr expects the seller to determine intent of every buyer… such as somehow magically deriving that a buyer is a student at one of those nearly 4,000 universities (or way less likely, even grade school), but also that the magically-derived “student” is buying the service with the INTENT of turning the resulting product in as their own work. Intent is something a seller cannot possibly determine or be expected to determine, let alone if the buyer is a student. Intent is difficult enough to determine and, more importantly, prove by defending and prosecuting attorneys in criminal court trials. How and, more importantly, WHY is a seller expected to determine intent for a site like Fiverr?
That’s like asking a gun dealer to be held responsible for intent of every gun sold. Thankfully, in the United States, there’s the PLCAA federal law that prevents this exact situation for gun dealers. Under the PLCAA, gun dealers cannot be held responsible for how a gun is used after it has been sold… which means, gun dealers cannot be held responsible for a buyer’s intent.
Fiverr’s Naïvety
Oh, it gets worse. Because there are so many institutions of higher learning not including grade schools, the seller would need to visit each and every one of those institutions of learning, THEN be required to read and understand each and every one of those rules of academic conduct for each of those ~4,000 institutions. That could take years. As I said, NAÏVE and insanely impractical.
Again, WHY is the seller responsible for this work? As a seller, I’m there to sell my services, not become police for for-profit higher education institutions.
Education Institutions
If schools have a problem with student conduct, that’s between the institution and the student. Fiverr, nor its sellers under it, has no role in this. That Fiverr has decided to take on the burden of becoming a police force for these mostly for-profit organizations is bewildering. Worse, that Fiverr expects the sellers to become that police is even more bewildering.
Work for Hire
In a discussion with a very naïve set of support representatives for Fiverr, a conversation ensued over this very same “academic police” issue. Essentially, the representative tried to make it seem like the seller is at fault by 1) not knowing the buyer is a student, 2) that a seller should know a student INTENDS to plagiarize and 3) that sellers are somehow responsible for that student’s plagiarism.
Let’s get one thing CRYSTAL clear. There’s no “plagiarism” under Work for Hire. The representative stated copyright infringement was also involved. There’s also no “copyright infringement” under Work for Hire. That’s not how Work for Hire copyrights work. If someone commissions and buys a work, such as writing a book, writing software code or any other software goods, as soon as the deal is closed, the delivered goods are considered as “Works Made For Hire”. The copyright office is very specific about this type of work and how copyrights apply to these works.
Works sold under “Works Made For Hire” see ALL copyrights turned over to the buyer as though the buyer created the work themselves. Meaning, as soon as the deal closes and those soft goods are delivered, the copyrights are fully, completely and legally owned 100% by the buyer. THIS is how “Works Made For Hire” copyright law works. From that link, here’s an excerpt that states that copyright law for a “work” (when made for hire) applies…
When a certain type of work is created as a result of an express written agreement between the creator and a party specially ordering or commissioning it
That’s exactly what Fiverr does… allow for commissioning a work using express written agreements. Thus, all works delivered from Fiverr are considered as “Work for Hire” and, thus, all copyrights are owned by the buyer upon delivery.
Academia, Works for Hire and Fiverr
Unfortunately, these concepts are like oil and water. They don’t want to mix. Academia wants students to create their own works. However, “Work for Hire” allows a student to buy a commissioned work, turn it in as their own work without legal issues and without plagiarism. Legally, under a “Work for Hire”, a student buyer owns the rights just as if they wrote it themselves. Therefore, no such plagiarism or copyright issues exist with “Work for Hire”. It might be an ethically poor choice on the student’s part and it might even deprive the student of much needed learning experience, but there’s nothing legally at fault here; not from the seller and not from the buyer.
Were the student to copy (not buy) a work from someone else and turn it in as their own, that’s plagiarism and copyright infringement. Keep in mind that plagiarism is not a ‘legal’ term. It’s an academic term typically bandied about when a student turns in a work they didn’t author themselves. However, commissioning someone and paying them for their efforts as a “Work for Hire” is not technically considered plagiarism and is most definitely not copyright infringement. While it might be ethically questionable for the student to take a “Work for Hire” route to complete an assignment, it doesn’t violate copyright laws and it isn’t plagiarism so long as the work was crafted by the seller as an “original work”.
Sellers Part II
With Fiverr, they’ve explicitly decided to place the burden of these “academically ethical” misdeeds onto the seller rather than onto the buyer / student. Let’s understand the problem here. Fiverr is not an academic institution. Fiverr, as far as I know, has no ties to academic institutions. Yet, Fiverr has crafted a Terms and Conditions policy that greatly benefits these for-profit academic institutions at the cost of requiring sellers to read and understand THOUSANDS of school policies to know if a potential buyer is violating any specific school policies.
WOW! Can you say, “overreaching?” I knew that you could. This situation is not only a ridiculous ask of sellers, it’s insanely complicated and time consuming and is highly unethical… all to sell a blog article, a work of fiction or a computer program on Fiverr?
None of this should be a seller responsibility. That’s Fiverr’s responsibility. A seller’s responsibility should end at selling their service. Violating school policies is the student’s responsibility to their school. The student agreed to their school’s conditions of attending that academic institution. The Fiverr seller plays no role in a student’s decisions. If a student intends or, indeed, violates a school’s enrollment conditions, that’s on the student to take the consequence. Fiverr should be completely hands-off of this process.
As I said, Fiverr’s management team is extremely naïve, gullible and unethical. That insane naïvety forces sellers to be incredibly overburdened as a long-arm-of-the-law for for-profit academic institutions combined with taking responsibility if a student violates a school’s academic policies. If an academic institution wants to task Fiverr sellers to become “academic police”, they can pay for that service like universities do for any other service.
Institutions of Higher Learning
Most higher education facilities (Universities and Colleges) are typically for-profit organizations. If they weren’t for-profit, they couldn’t keep the lights on, employ hundreds of instructors, janitors, staff AND buy desks, computers, buildings, land and so on. That Fiverr has taken the dubious and questionable step of writing into their Terms and Conditions a clause that favors these for-profit organizations is extremely questionable. Of course, one might ask, “Well, what about grade schools?”
Grade school is a whole separate bag and one where Fiverr shouldn’t actually ever see buyers for a number of reasons. The first and foremost reason is that grade school kids shouldn’t have credit cards to be able purchase items on Fiverr. The vast majority of grade school kids are at an age that prevents owning a credit card. A child might own a “learner” Visa debit card managed by their parents or perhaps a Visa gift card, but if Fiverr is accepting these payment cards without verifying age, Fiverr might be breaking other laws. For example, many grade school children are under the age of 13, which means that if Fiverr is allowing children under the age of 13 onto Fiverr’s platform, Fiverr is almost assuredly in violation of COPPA. Even minors under the age of 18 and who are still in grade school should be disallowed from making Fiverr purchases. In fact, only legal adults should be allowed to purchase services on Fiverr.
No, any application of “academic police” almost 100% both implies colleges and universities almost exclusively… which are most definitely for-profit organizations.
The above “academic police” situation would be tantamount to Fiverr adding a clause to its Terms and Conditions that holds sellers responsible for credit card fraud from buyers. Sellers aren’t “credit card police” any more than they should be “academic police”. Sellers have zero control over the payment system(s) that Fiverr employs and uses. Requiring such a condition for seller usage is not only backwater, it’s insanely stupid and definitely states exactly how inept the management team at Fiverr actually is.
Why would sellers be responsible for credit card fraud of a buyer when the seller has zero to do with that payment, that card or, indeed, the payment system? Sellers don’t get access to any of that card information. Thus, credit card management, just like academic management, is Fiverr’s responsibility.. and rightly it should be. It is on Fiverr to determine if a buyer is a student. It is on Fiverr to restrict and prevent purchases from students, not the seller.
If a seller is not a student at all and is not attending any academic institution, that seller holds exactly ZERO responsibility to any academic institution. Because Fiverr’s Terms and Conditions foists this agreement onto the seller is disingenuous, highly dubious, insanely stupid and, because of the time required to manage it, highly unethical. Everyone can understand the “credit card fraud” issue, so why is “academic fraud” any different here?
Low Wages
As a completely separate issue, but one that’s extremely relevant for sellers at Fiverr is how much money can a seller expect to make?
As a tech worker, the average wage to write code or build software, at least in the United States, is at typically between $30-70 per hour depending on experience, language, the type of code being written and so forth. That’s a lot for an hourly rate, but that’s the going rate in the United States.
Because far too many buyers on Fiverr are from Israel, Pakistan, India and other middle east countries where wages are very depressed, the expectation of costs of providing these services is extremely low. Meaning, instead of the normal going rate of ~$40 per hour, you’re expected to drop your fee down to $5 per project. Ironically, I think that’s why they named the site “Fiverr” because a “fiver” is all you’re going to get (less actually). I think you see the economic problem here. This brings me to my next point.
Commissions and Fees
Fiverr gets its money both coming and going. What that means is that for every “gig” sold (what they call a listing), Fiverr takes a 20% cut from both the buyer AND the seller separately. That’s a total of 40% cut for Fiverr from every single project sold. Let’s put a dollar value on that. For a $5 order, a seller will receive $4 with $1 going to Fiverr. A buyer will spend $6 to cover the $5 seller cost seeing $1 going to Fiverr. That’s a total of $2 that Fiverr made from that $5 sale.
This means for that $5, the seller doesn’t actually get $5, they get $4 (less after income taxes). You might spend 2 or more hours working on a project to receive less than $4? That’s way less than even minimum wage. So then, what’s the incentive to sell on Fiverr if nearly every buyer expects to spend $5 for almost any project? Yeah, that’s the real scam here.
Scam
Let’s get to the heart of the matter. Is Fiverr a scam? Clearly, Fiverr’s team is naïve and doesn’t understand the service they are offering. However, the overly expensive 40% commission that Fiverr takes combined with its overreaching Terms and Conditions, which is clearly designed to favor educational institutions over its sellers, and because the low price expectation from mostly middle east buyers leads the platform into extremely scam-ish territory.
Is it a scam? I don’t think the founders intended for it to be, but at this point it almost certainly is a scam. There are similar sites, like Upwork, that seemingly operate in a somewhat more legitimate way, yet those sites still choose to employ the overly high 40% commission system. However, because Upwork attracts more legitimate clientele over the “middle east crowd”, setting up listings on Upwork is more likely to lead to a better wage than when using Fiverr.
Bottom Line
Don’t go into Fiverr expecting to make a lot of money. Because of the mostly “middle east buyer crowd” who expects rock bottom prices that Fiverr seems to attract, because there’s few controls for sellers to protect themselves, because sellers must become “academic police” for for-profit educational institutions, because of the incredibly high 40% commission and because the actual income is so low, I’d class Fiverr as “mostly a scam”.
I strongly recommend avoiding this site unless Fiverr’s management team can get their act together and clean up all of these issues. Instead, if you’re looking for other “Work for Hire” type sites, try Upwork or CrowdSpring or, better, put your resume on LinkedIn and attempt to get legitimate actual employment with a real livable wage. However, if you enjoy frittering away literal hours of time for less than $5, then by all means head over to Fiverr.
How does Twitter Philanthropy work?
How does all of this Twitter philanthropy actually work? Let’s explore the seedier side of it.
Twitter Philanthropy Exposed
I won’t name any specific accounts simply because there are too many of these accounts preying on people’s needs, but let me expose how these accounts REALLY work. There is one on top of this pile, but I will let you find it yourself. If you search Google for the key words “Twitter Philanthropy“, you will find this specific Twitter account within the first 10 search results. But, don’t go run over there just yet to follow it before reading this article.
Twitter Impersonation
Let’s start this out by explaining how these accounts operate. While some of these large Twitter philanthropy accounts purport to be operated by a single individual, they are not. Instead, they are operated by a team of individuals who have access to this single Twitter account so named for a single person. In fact, this situation is in violation of Twitter’s Terms of Service rules of impersonation.
Impersonation is a violation of the Twitter Rules. Twitter accounts that pose as another person, brand, or organization in a confusing or deceptive manner may be permanently suspended under Twitter’s impersonation policy.
By operating an account as a team, rather than by the single individual named on the account, this is definitely impersonation… regardless of whether the single individual has authorized that “team” for that purpose.
If you are interacting with a Twitter account who appears to be a single person, but unbeknownst to you there are actually multiple people who are not the named individual operating that account, this is entirely deceptive and misleading… and the very definition of impersonation. You are not dealing with the person you think you are. This is in violation of Twitter’s rules. Whether Twitter sees it that way is entirely subjective and based on Twitter’s whims, unfortunately.
Team Accounts
There are many team operated accounts on Twitter. Many celebrities operate such accounts. Since the celeb can’t be at the account 24/7 to answer responses, they hire staff to manage these tweets. Most times, these celebrities are represented fairly and appropriately by their hired staff, mostly because the staffers remain in close contact with the celebrity to make sure the tweets are appropriate to the celebrity’s brand.
With these philanthropy accounts, it seems these are much more loosely operated. The team is made up of people around Twitter who manage this account and have Twitter accounts of their own. They don’t always seem to have direct approval of the account owner. If you read through some of these philanthropic account tweets, they seem to show random and incoherent tweet-to-tweet messaging, espousing differing and hypocritical ideals. Why? Because different people are posting these tweets to that single account under the guise of impersonating a single person.
Philanthropy Exposed
While these accounts may have started out as genuine philanthropy, they have degraded into an odd scam that takes advantage of people’s needs… and mostly exist as ways of gaining followers. Worse, these accounts breed even more scam artists. Scam artists who WILL take advantage of you and scam you in the process. I’ll talk about the scammers at the end and how those work. Let’s focus on the actual purported philanthropy accounts first.
Why a team?
Good question and one that you’ll understand once I explain it. Basically, when more team staffers are attempting to locate money from other contributors, that means more money to share in the guise of philanthropy under that single Twitter account. Looking for contributions isn’t the problem here, though. It’s the scammy WAY that this team goes about looking for contribution money. If this single aspect doesn’t leave a bad taste in your mouth, keep following along as it gets so much worse.
The team that makes up the single top Twitter philanthropy account uses Twitter (and sites like GoFundMe) to gain money first. Instead of actually giving out money from the purported account owner, the team actually solicits money contributions from random people using dubious methods including begging, groveling and outright scamming using sites like GoFundMe. These team members are then adding their ill-gotten money into that Twitter account’s philanthropy fund for giveaways.
Here’s where the deceptive part comes in. This team of people collect these monies using their own personal accounts, accounts not associated with that Twitter philanthropy account. This makes it difficult to trace where that philanthropy money actually came from. Deceptive and a form of money laundering. Dirty. When other people contribute their money to one of these outside accounts for some possibly even fake purported need, this is a huge problem for these larger philanthropist accounts. Any money given out by a philanthropist shouldn’t have been obtained by using a scam. Yet, here we are.
Yes, this means this team is not actually giving out the philanthropy account owner’s money, as is implied by the account owner’s statements. Instead, that team is raising funds using outside means, possibly using deceptive means (claiming to be raising money on behalf of a veteran or claiming to have a high electric bill). Then, they take that money that has been raised and give it out on Twitter. Do they give out 100% of that contributed money? Do they use the money towards the claimed need? My guess to both of these questions is no. These philanthropy accounts might be keeping as much as 50% or more of the money they collect and, in turn, only give out 50% or less of those ill-gotten contributed funds.
It’s one thing to solicit money for an intended purpose and use it for that purpose. It’s entirely another to solicit money for a purpose, not use it for that purpose and give it away to someone on Twitter. Full disclosure here? Yeah, no. Not to mention the tax ramifications of such a setup.
Giving Money Away
While giving away money might seem a good thing, this action actually preys on people in need. Worse, the way these accounts are being managed is dubious at best. Yes, it gets even worse. These accounts have so many followers that they can’t possibly manage what gets written into their Tweets. What you’ll find in most of the Tweet replies consist of people claiming to also give away money. I’d bet that at least 99.9% of these people dropping in Tweet replies are scammers looking to part you from your money. It might even be some of the team running that same philanthropy account looking for money for their next “giveaway”.
This is why this situation is a double whammy for those in need. Not only is there so little money given away from these top Twitter philanthropy accounts (they can only raise a couple hundred dollars at a time usually), the Tweet replies are chock full of scam artists willing to take advantage of you.
The act of giving away this money on Twitter might seem altruistic, but I guarantee you that it is not. There is no altruism going on here. It’s all about gaining followers on Twitter and making it SEEM like the account is altruistic. It’s just a show. The reality is, it’s a business that follows the following formula:
- Team hides behind Philanthropy account (unbeknownst to Twitter followers)
- Team is tasked to raise money (using whatever dubious means necessary) from random individuals, each team member raising money separately using their own individual accounts
- Team places raised money into Twitter account fund for “giveaways”
- Team likely keeps much of that money for themselves as “payment”
- Twitter Philanthropy occasionally awards random folks for random reasons
What if I win?
If you are one of the very few who manage to get picked to receive money from a philanthropic Twitter account, don’t think it’s all roses. To receive any money, you are required to jump through legal hoops before that money is deposited into your account.
“What legal hoops?”, you ask. Good question. You are required to agree to a long, stringent set of terms and conditions before you are awarded any money. These conditions allow this Twitter philanthropy account to do whatever they want with your win while restricting you. What document would I sign? You will need to read and sign a Non-Disclosure Agreement (NDA) and return it to the team operating the philanthropic account before you can take possession of that $20 or whatever small amount they are willing to give you. This is the very definition of victimizing someone in need. Someone in desperate need of money would be willing to sign just about ANYTHING to get that “free” money.
Once you agree to their restrictive terms and conditions, they will send you that money via CashApp or whatever other agreed upon payment system. If you violate these terms, they will sue you.
This is not a no-strings-attached way to get money. In fact, it wouldn’t surprise me to find that some of these “charity acts” might actually be loans which must be repaid at some point in the future. In other words, be very, very careful if you choose to attempt to get money out of these philanthropic accounts. They may screw you on the way in and on the way out… and perhaps even later in the future.
Twitter’s Response
Unfortunately, Twitter (the company) doesn’t monitor or manage any of these philanthropy accounts. They allow them to operate with impunity. Because it seems that these philanthropic accounts “appear” (it’s all about appearances) to be doing good for the community, Twitter (the company run by Jack Dorsey) turns a blind eye and allows this bad situation to continue and fester. Few people actually get anything good out of these accounts. Even more are getting scammed from the tweet replies claiming to also give away money for following and retweeting. Don’t fall for any tweet replies. They’re almost certainly a scam.
Essentially, Twitter is turning a blind eye to these accounts which, in fact, do not perform a “good service” for Twitter. In fact, there are likely more people being scammed out of their money than ever receive money from any Twitter philanthropy. On Twitter, it’s not okay to write about certain controversial topics, but it’s perfectly acceptable to take advantage of people in need and scam them out of even more money? Thanks for looking out for us, Jack!
Scams and Philanthropy
As I stated earlier about Tweet replies in the article, let’s now understand how you can get scammed through fake philanthropy on Twitter. There’s actually more fake philanthropy going on Twitter than there is genuine philanthropy.
In fact, it’s very easy to get scammed out of money on Twitter. This specific scam isn’t what the top philanthropy accounts are using, however. Instead, they use the model described above, which is nearly as seedy. With that, let’s look at how fake philanthropy accounts on Twitter attempt to part you from your money so they can sip champagne on a beach.
This next philanthropy scam is bait and switch and it’s the primary way they scam you. How this one works is that you’ll see someone Tweet replying they’re willing to give you money and all they need is your CashApp tag sent to them over a direct message (DM). You then give it to them. Seems harmless enough, right?
The Scam Begins
Over the DM area, they’ll start by asking you a lot of seemingly personal questions. If you pass all of these probing questions, they’ll explain to you that their CashApp app is broken and that they can’t use it. They’ll tell you they need to switch to using PayPal. Here’s where the scam actually begins. Any philanthropy person who switches the payment method sets up a HUGE RED 🚩. Don’t fall for this. If the person can’t use CashApp, which enticed you in, to send you the money, walk away. CashApp can be used by anyone and it can be set up quickly. Any excuse someone gives for not using CashApp is fake.
When they switch to using PayPal, they can then claim to need you to send them money to cover fees or other such nonsense to complete the PayPal cash transfer. In that goal, they’ll issue you an invoice to pay. This is the scam. First, PayPal doesn’t need money to complete a cash transfer. Anyone making this claim is scamming you. Second, you shouldn’t need to pay any money to get money. If they can legitimately pay you, they will pay you no strings attached. Third, remember that they roped you in by offering the use of CashApp, then inexplicably switched to PayPal (bait and switch).
Anyone who can legitimately pay you money can do so using CashApp. There is no need to switch to another service. You can read more about PayPal scams here, and there are plenty more just like this one.
Screenshots
To attempt to trick you further by making themselves seem legit, they will send over a screenshot showing that they paid someone else money. A screen shot is EASILY faked, let alone found on the Internet. There’s no way to verify that any screenshot they send you is in any way linked to them (or even legitimate). In other words, screenshots are not proof of anything, let alone of being charitable.
If the person is legitimate, they will send you the money without asking you for anything in return. If they ask for anything in return, it’s a scam.
Uncomfortable Questions
Other behaviors they might exhibit is asking a series of deep probing questions you might not feel comfortable answering. Specifically, question like what bank you are using, what credit card companies you have, and so on. That’s none of their business. If they’re willing to send you money under philanthropy, they don’t need any of this information. If they begin asking probing questions like social security numbers, birth dates, actual account numbers or any other deep personal information, this has the hallmark of scam all over it. Remind them that the CashApp tag is all they need to send over money. If they can’t do this simple one thing, then they’re not legitimate.
Philanthropy should be about the good in giving, not finding out as many personal details about a person as possible. If someone begins asking very deep diving personal questions about you, your location and your finances, walk away. Explain to them that they don’t need that information to be charitable. If their charity relies on this information, they can find someone else.
Chances are, the reason they are asking these personal questions is to not only scam you, but take the rest of your accounts for a ride.
The Dark Side of Twitter Philanthropy
Yes, there is actually an extremely dark side to Twitter philanthropy which has now been exposed showing just how dark it can get. No, Twitter philanthropy is not all roses, as some adamantly claim.
For a moment, let’s suppose you do win the philanthropy lottery. Let me ask you this simple question. As a recipient of that supposed good will money, do you really want to accept that money not really knowing if someone behind that philanthropy account scammed another to give you that money?
Yeah, I wouldn’t want to either. Money can be helpful, but not at the cost of someone else being scammed out of it. Be careful and tread lightly when following any Twitter philanthropy accounts. Keep your guard up and watch out for people on Twitter claiming to be altrustic do-gooders. In these especially hard times, don’t fall for fake altruism. If you are really in need of money, head over to GoFundMe and plead your own case with your money raising efforts. The money you raise at GoFundMe will be yours without such underlying strings. If you’re putting your hand out towards someone else’s wallet, particularly on Twitter, expect the worst in people.
In fact, let me point you to this exposé article describing one particular philanthropy account on Twitter. This article is a bit disjointed of a read, but if you can follow it, you will better understand this very dark and seedy side of Twitter Philanthropy in excruciating detail.
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Robocalls: Gotta Hate ‘Em
If you own a phone, you’ve likely gotten a robocall… and they suck hard. This one is short and sweet. Let’s explore.
Most Annoying Robocall?
The most annoying robocall ever has to be this one:
“What exactly is this specific robocall all about?”, you ask?
Well, I’ll tell you! It’s a sales and marketing multi-level scam. Apparently, this scam was devised by Paul Stevenson when he formed Exitus Elite. This company sells packages of varying “educational materials” (and I use these terms loosely). These materials contain marketing and sales “education information”. Yeah, you’re selling so-called “secret knowledge” about how to make money using marketing and sales. It’s a catch-22 circular sales pitch. You’re selling the exact thing that got you roped into the scam in the first place. And, you had to pay for that “knowledge” the first time before you can actually begin selling it. Yeah… so there’s that. That’s why it’s a scam.
Most scams like this require an investment before you can begin selling the thing you got roped into buying.
Now, don’t run off and go buy into this scam lest you read the fine print details. For example, Exitus Elite offers sales of four differing “knowledge” packages priced between USD $250 and USD $1000. If it were only a one-time purchase, it might not be so bad. Unfortunately, it gets worse.
In fact, you’re actually joining a “Membership” program called “Exitus Elite” that costs $299 per year. After you pay your $299, you are hooked up to someone who can then sell you one of those four expensive “Genesis” packages priced starting at $250. Your purchase helps out the MLM “representative” you buy it from which then allows you to begin selling the very same packages to other people.
Worse, Exitus’s refund details are sketchy at best. They claim a 7 day refund policy, but good luck trying to work that out with them. Their strategy will most likely string you along past the 7 day mark and then claim it’s too late to exercise a refund (usually the reason for such short refund periods). If you try to charge the refund back to your credit card, Exitus’s terms claim the right to be able sue you. It’s actually a scare tactic. They can sue you anyway. It’s just that because you signed up by agreeing to those terms, that “agreement” may or may not hold up better in a court of law. However, no terms a company like Exitus writes can deny you your ability to use your credit card’s chargeback program. If you feel you’ve been scammed by a company, it is your right to contact your credit card company and dispute the charge.
Stay Away from MLMs advertised via Robocalls
It is always your best option is to avoid getting involved with any multi-level marketing programs, especially when they are advertised over annoying robocalls from companies which repeatedly violate the Do Not Call registry. Some MLMs may make you small amounts of money, but you’re always making money off of the backs of other people.
To succeed in an MLM, you basically have to rope people into the same MLM scheme that roped you in, forcing them to pay a lot of money to the company and giving you some tiny amount for “referral”. If you enjoy alienating friends, relatives and co-workers, then perhaps MLM money stealing scams are for you. If not, then try other more legitimate methods for making money.
If you receive this (or any) robocall that sounds similar, hang up and block the number on your phone. This action is your best option to avoid being scammed. Just forget all about that call and do something better with your time and money.
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Should I buy an Xbox 360?
This question seems to be common for some reason. I’ve seen it asked on Quora and on various other sites. I’ve even seen YouTube channels discussing the purchase of Xbox 360s. Let’s explore.
Design Flaws
First, a little history. The difficulty with the Xbox 360 was the Xbox team’s design of Xbox 360’s main board. Because this system was designed by an in-house design team at Xbox, they got a lot of things wrong with the hardware design based on incorrect assumptions. The primary problem was cooling the GPU down properly. This issue compounded with the thin flexible main board (intended to flex as the system got hot). The difficulty with this flexion is that it doesn’t want to work with surface mounted components and it could lead to the board becoming permanently warped and did lead to the GPU unseating itself unceremoniously.
For this reason, the later Xbox 360 editions, specifically the Slim models, clamped the board to the aluminum chassis to limit flexion of the board around the GPU and CPU. However, even this updated clamping system only delayed the inevitable… the Red Ring of Death commonly known as the RRoD. The difficulty of the design was primarily as result of using lower temp solder that would become molten at GPU operating temperatures. This meant that as the board flexed, as the CPU and GPU heated, as the fans and the hard drive caused vibration and even as external audio sounds from neighboring TVs and stereo system caused vibration, this could cause the GPU to lose solder cohesion and shift this chip off it is surface mount pads.
This GPU shifting would leave the system with the Red Ring of Death. One fix for this was using a towel and wrapping it around the Xbox 360 to let it heat up. What this did was cause the internal temperature of the Xbox 360 to rise which allowed the solder to reflow under the GPU and cause the chip to sort of move its way back onto its correct pads. The difficulty is that this was a temporary fix. The operating conditions that led to the original Red Ring of Death would eventually see to it that it would happen again, usually in only a few days. For the towel reason alone, you should avoid buying used Xbox 360s. It means that someone could have toweled their system right before selling it to you… and it might only run for a few days.
Refurbishment Process
Because of the design problems that led to the Xbox 360’s RRoD, the Xbox hardware team decided to try different things to see if they could improve the situation. As mentioned, one of these changes was the chassis clamp. Other changes included better and smarter positioned heat sinks. All of these changes only treated the symptom, not the actual design problem.
Ultimately, the primary fix for an Xbox 360 suffering from RRoD is to reball the chip with a higher melting point solder and then remount the chip. Then, adding on the smarter heat sinks to ensure proper heat dissipation from the chassis. Once the chip was reballed with higher melting point solder, it should no longer shift its position under standard operating conditions. Of course, the board could still flex and warp which could lead to other surface mount chip failures besides the GPU.
Companies like Gamestop employ either internal or third party refurbishers to perform refurbishment on Xbox 360s before selling them as ‘certified refurbished’. The problem is that reballing chips is time consuming and expensive. Gamestop doesn’t seem to want to afford such refurbishment processes and instead lets the refurbisher perform whatever they deem appropriate short of reballing, which is usually inadequate to provide a long term stable fix to these consoles.
Buying Refurbished
When you buy an Xbox 360 that’s been refurbished from Gamestop, the store has no idea what work has been performed on any unit. It might be simple DVD drive replacement to full main board replacement from other Xbox 360s. It’s possible to actually find frankenboxes with refurbished Xbox 360s having been rebuilt from a bunch of different generation parts. This means you could see some parts from the first gen, second gen, third gen Xboxes and so on… all coming together into the same unit. It means that the heat sinks might be the incorrect version for that version of the unit. Who really knows what you might find inside?
This is the problem with buying refurbished units from not only Gamestop, but any company. The design decisions that made the Xbox 360s so problematic compound into making the purchase of any used or refurbished Xbox 360 system a grab bag of problems.
Not Built to Last
The bottom line is that the Xbox 360 was not designed to last. It was designed to fail because of a set of design decisions that just didn’t work out. In short, it’s a lemon. It’s not just one version that’s the problem, it covers all generations.
Sure, some have claimed their their Elite has lasted. Some have claimed their slims have lasted. Even the last version of the Xbox 360, the Xbox 360 E suffered from the Red Light of Death. There has not been one version of the Xbox 360 produced that has been immune to the Red Ring of Death (or Red Light of Death) problem. You can’t rely on buying a more recent version of the Xbox 360 on the assumption that the failures have been eliminated. Some versions of the Xbox may have been a bit less susceptible, but at some point they will all succumb to failure.
Don’t believe the current sales hype that because this is the newest version of the Xbox 360 that it won’t have a problem. It very likely will. In fact, you should consider the Xbox 360 a unit with limited mileage. At some point, the system will fail and you’ll be left with a dead brick. The question is, when it will happen. It could happen 3 days, 3 weeks, 3 months or even 3 years in the future. The point is, you spend your money and you just don’t know. However, because of the age of these systems now, it’s more likely the system will fail sooner than later.
Aging Hardware
The last Xbox 360 E model was discontinued in spring of 2016. This means that any Xbox 360 you might consider purchasing is now over two years old as of this article. That’s only if it’s an E model. Any other models will be much older.
There’s nothing new about any of these systems. Though, it’s entirely possible that some warehouse somewhere has some Xbox 360 E models stashed as new unopened stock. If you could find one of these, you might have some possibility of longevity with that Xbox 360. However, anyone claiming to be selling new unopened stock is probably scamming with a used or refurbished unit. I wouldn’t even trust Gamestop with this kind of a claim, even as big a company as they are. The only way you could trust this statement is to have them show you the merchandise. If you’re buying over the Internet sight unseen, don’t trust anyone.
No. You should always consider any systems on sale as, at best, used. Even refurbished consoles should be considered suspect. Better, don’t consider the purchase of any Xbox 360 at all.
Should I Buy?
In fact, you shouldn’t. Because of all of the aforementioned problems with the design, there’s just no way to know exactly what kind of condition any Xbox might be in. Unless you want to disassemble the unit to find out what’s on the inside and that you understand what you’re looking at, you should avoid spending any money towards an Xbox 360.
The bottom line is that the Xbox 360 is a risky investment that you might only get a few days of use out of before your new purchase dies. The Xbox 360 was a risky investment when buying it new. When buying it used or refurbished, the chances of receiving a unit that lasts only a few weeks is very high. In fact, it could be that the unit might last you long enough to get past the return policy, but a few days after that the unit dies. Then where are you?
Xbox One and Xbox 360 Compatibility
While not every Xbox 360 game has been made compatible with the Xbox One, many Xbox 360 games have been made to function on the Xbox One. Unless you want to play a game that isn’t compatible with the Xbox One, there’s no real reason to buy an Xbox 360.
For this reason, putting your money towards an Xbox One not only guarantees a better hardware experience, it also guarantees you’ll be able to play not only Xbox One games, but also all compatible Xbox 360 games. This is a much better deal than wasting your money on an old console that could die at any moment.
Xbox 360 Purchase Disclaimer
With that said, if you can find someone willing to sell you a fully functional Xbox 360 for $25 or less, then it’s probably fine to buy it… as long as you understand the unit may only work for a few days. If you’re considering spending well more than $25 for an Xbox 360 console bundle, you should consider the purchase of Xbox One instead and avoid the almost certain limited lifespan of the Xbox 360.
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Is DealDash a Scam?
I’ve always been fond of online auctions, until I found DealDash several years ago. I’ve also seen a number of people who have complained about DealDash and how it operates. Let’s explore if it’s a scam.
Auctions and Bidding
In a traditional auction, you’re actually buying from a seller who has put an item up for consignment to the auction house. This is how eBay works it. The seller uses the eBay platform to pay for their auction. If the item sells, eBay gets a cut of the profit. This is a typical auction from a typical auction house.
Bidders pay nothing to bid at eBay. You simply join the platform and off you go on your merry bidding way. You will pay for any auctions you win or any Buy-It-Nows you buy, but if you bid and don’t win, you pay nothing. This is important when understanding the difference between a site like eBay and DealDash.
At eBay, auctions have a finite end. If the auction closes at 6PM today, then it’s over at 6PM. Whomever was the highest bidder at 6PM is the winner of that auction.
DealDash Auctions
With DealDash, the auctions here work a bit differently. Instead of joining and bidding for free, you must pay for your bids. The bid cost can range between 12¢ and 60¢ per bid. In order to get started on DealDash, you’ll be required to pay for some initial bids. Sometimes DealDash offers bid sales for as low as 12¢ per bid.
As for the auctions themselves, they work quite a bit differently from eBay. Unlike eBay’s fixed close time, DealDash has no fixed auction close. Their auctions infinitely run and continue to extend until the 10 second countdown timer runs out without any further bids. As long as even one bid happens within that 10 second countdown, the auction extends with another 10 second countdown timer. Basically, an auction can run infinitely or until no one else places a bid. Bids also increment the item cost at 1¢ per bid. You spend 12-60 cents to raise the bid on an item by 1¢. Admittedly, that means the item cost goes up very slowly, but it also means that the bidding can go on for days with enough bidders.
Bid Extensions
You’re probably wondering about how people can manage to bid within 10 seconds. To answer your question, they don’t. Bidders use a feature that DealDash offers known as Bid Buddy. See below for more details. Suffice it to say that DealDash’s automated system continues punching in those bids in an automated way so users don’t have to. You’ll also notice that many of those bids are made right at the last moment of second 9. There’s no way a human could time a bid that precisely.
However, there has been some speculation that some of the bidding is rigged by DealDash. That speculation alleges that DealDash itself has its own set of automated bidders driving up auction prices and bringing attention to those auctions. I can’t tell one way or another if this is true. I’ll leave that speculation alone because of Bid Buddy and how it works.
Buy-It-Now
Both eBay and DealDash offer a Buy-It-Now option. However, these work entirely differently between DealDash and eBay. The eBay Buy-It-Now feature can be standalone or attached to an auction. If it’s standalone, you can only buy that product through Buy-It-Now. If it’s attached to an auction, you can only use Buy-It-Now before the auction begins. Once an auction has a first bid, the Buy-It-Now option disappears for that item.
With DealDash, if you bid on an auction, you are eligible to Buy-It-Now when the auction finally closes. You’ll buy the item at whatever price that DealDash offers, which they claim is usually at a substantial discount. In addition to buying the item, you’ll also get all of your bids back for free. This means you can reuse those bids again on future auctions. It’s not a bad deal if you really want that item. However, if you decline the Buy-It-Now purchase, you lose all of your bids. There’s a big incentive to bid on items where you are likely to buy it when the auction closes no matter the price.
Bid Buddy
DealDash offers an automated bidding service called Bid Buddy. It continues to bid on your behalf even when you’re not around to do so. eBay also has a similar feature, but it’s tied to the actual bidding process and doesn’t have a name. If you put in your maximum bid on an eBay auction, eBay will continue to bid on your behalf at the current bid increment until your maximum bid is reached. After that, you’d be responsible for upping your maximum bid or bidding manually.
Bid Buddy works in a similar way. It continues to bid on your behalf until you’ve run out of bids or reached the maximum number of bids set on that auction. The reason to use Bid Buddy is clear. Those who are using Bid Buddy get priority over those who are manually bidding. It is in your best interest to set up and use Bid Buddy rather than manually bidding. Otherwise, your manual bid will always be last in line.
So far, So good
So far, there’s nothing here extraordinarily bad about how DealDash works. Other than the infinitely open auction which I don’t personally like, it’s pretty straightforward in how it all works.
Products and Quality
Here’s where this site falls down hard. Do you go to DealDash to buy merchandise for a great deal or to spend time gambling to win? If it’s the former reason, then you might run into problems considering all of the below. If it’s for the latter reason, you might want to seek gambling help.
DealDash claims to offer overstocked products at “discount” prices. The difficulty with this business model is that DealDash is in this business to make money off of bidding with the side effect of an eventual sale of a product. They are not a retailer, not a discounter and definitely not in any way a reputable store. They are an auction house and that’s how they run it.
As a buyer, you’ll notice there’s nothing mentioned about a Return Policy or what to do if you receive damaged or unacceptable goods. Indeed, there’s nothing on any of DealDash’s auction listings that even mention the quality or authenticity of the merchandise that you will receive if you buy or win the bid.
The products purport to be genuine, but are they? Also, unlike eBay where there’s a seller behind each and every product, with DealDash, DealDash is the seller. This means that if you have a question about the sale of a product, you have to go to DealDash to get it answered. Worse, buyers have tried doing this with no response from DealDash.
If you’re actually wanting the product you’re bidding on, you might want to consider that what you’ll receive may entirely differ from the listing. In other words, the trust level with DealDash’s merchandise is very, very low. If you really want that merchandise, you can probably find it cheaper from a more reliable seller on eBay or Amazon without the bidding fees. On eBay, both the sellers and the products themselves have a reputation score. You can see what buyers are saying about both the product in the listing and of the seller’s reputation. You’ll notice that on DealDash, there is no reputation information about the seller nor reviews from buyers about the product or what they received. DealDash is a black box.
Being the black box that it is, unfortunately, DealDash is about as scammy as it can get from a site like this. If you can’t readily see what other buyers have received from a listing, then how do you know that you’ll receive anything of value? You don’t.
Additionally, because DealDash is not a traditional store, returning any merchandise may be next to impossible, particularly when you can’t get in touch with anyone at DealDash. If the item you receive is damaged, misrepresented or outright garbage, you’re stuck with it. Otherwise, you’ll have to dispute the credit card charge. The only other thing you can do is complain about DealDash… and many people have done exactly that on RipOff Report. However, other than venting your frustrations to the world or forcing a chargeback, you may not be able to get your money back.
Jumpers and No Jumper Auctions
Here’s where DealDash also gets just a little bit more scammy with their auction site piece. A jumper is a person who jumps in at the last minute and begins bidding on an auction when they think the auction time is about to run out. Unfortunately, jumpers on DealDash effectively mean nothing. A “No Jumper Auction” is simply a way to allow early bidders not to be outbid by someone who wants to jump in at the last minute. With DealDash, there is no such thing as a ‘last minute’. On eBay, there is a ‘last minute’ because auctions have a hard close time. On DealDash, the auction is infinitely extended so long as even one person continues bidding.
A “No Jumper Auction” sets a minimum bid point that after that no new bidders are allowed to enter the auction. If the no jumper point is set to $5, that means new bidders attempting to bid after $5 will be unable to do so. Only bidders who placed at least one bid below $5 will be able to continue bidding on that auction.
This then excludes users from auctions after the no jumper bid price has been met. On eBay, this is called ‘sniping’ or ‘snipers’. A sniper is a little different from a jumper in that because the auction close time is finite, snipers join in during the last 30 second countdown to try and outbid the current high bidder. With DealDash, a “No Jumper” feature is entirely pointless and just gives DealDash a way to manipulate auctions and who can bid. This feature only serves to force people into auctions early or wait for another one to start. This feature is simply a way to lower competition and allow early birds to win the auction more quickly without extra folks jumping in and keeping the auction open much longer. That seems to go against the idea of DealDash making more money. It’s kind of a weird feature for DealDash to add a limit auctions and prevent even more bidding, losing DealDash even more money in this process.
The scammy part of this is that apparently these “No Jumper” auctions don’t work properly, or DealDash is able to manipulate the “No Jumper” price randomly against would-be bidders. Some bidders have claimed to join in on standard “No Jumper” auctions with the default threshold set to $5. Yet, the auction price never reached $5 and they were unable to bid with DealDash claiming they were a jumper. Fishy. It seems this feature is being manipulated by DealDash in a way that prevents certain bidders (new or not) from bidding on that “No Jumper” auction.
Is DealDash worth it?
DealDash is ultimately an addictive form of legalized gambling, but it actually feels much like playing slot machines in Vegas. Mostly you lose, rarely you win and you spend a lot of money doing it…. which is how DealDash likes it. It’s what keeps them in business. If you’re willing to Buy-It-Now, you can buy back some of your bids at the cost of the product stated in the listing. But, don’t expect the price of the Buy-It-Now merchandise to be any less expensive than what you’ll find in a retail store, according to many who’d done this.
Some complainants who’ve used the Buy-It-Now option have been quite disappointed in the process. One user claimed that instead of getting their bids back as was promised, the “total value” of the bids was deducted from the price of the Buy-It-Now item. However, the “total value” of the bids applied to the reduction in the item’s cost were substantially lower than what the user paid for the actual bids. They might deduct at 12¢ per bid when the user paid 60¢ for the bids. Assuming you can actually get your bids back instead of this deduction thing, that’ll buy you a little more time to bid on new items and addict you further to this form of legalized gambling. This getting-bids-back idea is a little like losing $500 at BlackJack and then winning back $100. You’ve still lost $400. It’s simply a way to make you feel a little better about having lost $400.
If you get a high off of gambling, DealDash may be worth it… particularly if you don’t care about whatever it is you might win.
If you do happen to win the bid on item, then you’ll lose all of your bids plus whatever the winning cost of the item. If you happen to win a bundle of bids, then you’ll lose your bids only to gain some back. If you win the bid on a pair of earrings, you’ve lost however many bids it took to win that bid plus the cost of those earrings.
Consider if you don’t do Buy-It-Now often and you continually keep losing bids, you need to keep track of how much money you’ve spent there. You need to keep track because all of your lost bid money adds up when you finally do win a bid. For example, if you’ve spent $500 buying and losing bids for a while, then win a $50 coffeemaker, technically you’ve spent $550 for that coffeemaker. That’s not such a great deal. You could have bought 11 coffeemakers for the amount of money you spent to win that bid at DealDash. You simply can’t ignore all of the money you’ve spent on bids as non-existent. Those bid costs add into the cost of any items you bid and win. This means you can’t claim you got a toaster for $5. It was $5 plus the cost of however many bids it took you to get there.
Scam or Not?
The idea behind the site is fine, the execution of it is poor. If DealDash had partnered with legitimate sellers to back each of the auction products and if DealDash had allowed buyers to review the product listings for quality and authenticity and if DealDash offered a buyer’s protection plan and an actual Return Policy like a legitimate store, I might be more inclined to say it’s not a scam.
As it is, because DealDash doesn’t act like a legitimate store and also doesn’t offer feedback from buyers nor is there a buyer and seller relationship to ask questions, I cannot recommend the use of this site for any purpose… not for buying products and definitely not to get your gambling fix.
There’s too much of a chance to lose far too much bid money and very slim chances you’ll actually win a bid. Of course, you’ll be given the option to Buy-It-Now and get your bids back on auctions where you lost the bids, but that’s of little consolation if the merchandise you receive is trash, assuming you receive anything at all. Between the bids you pay for and the Buy-It-Now, this is how DealDash makes money. The rest is all an addictive game.
Testimonials
Don’t be fooled by people holding up a piece of merchandise that they claim to have received from winning an auction. There’s no guarantee those are legitimate photos. You have no idea if the merchandise you will receive is legitimate, counterfeit, refurbished, used, hot or in any other condition.
Even if the “winner” photos are legitimate, what you don’t know is how much those people have spent in bids to DealDash to “win” the privilege to buy the item at that price. They could have been bidding for years and have already spent a ton on bids before they finally won an iPad. In fact, they could very well have spent more than simply going to the Apple store and paying full price for one.
It’s just like being in a Casino. When you hear the bells ring and see the lights flash on a machine because someone has hit the jackpot, you really don’t know if that’s a win or if someone is simply making back a little money towards what they’ve already lost.
Recommendation
Site Recommendation: 👎 Avoid!
Reasons:
- Highly Addictive
- Form of gambling
- Not a store
- No Return Policy listed
- No Product Reviews
- No User Reviews
- No Seller Reviews
- Auction items don’t describe authenticity or condition
- Pay to bid
- Pay to win (separate from item cost)
- Costly
- Difficult to Communicate with DealDash
- Mostly a scam to separate you from your money
- Doesn’t operate like a legitimate store
- May be less costly to shop elsewhere
- Questionable business practices
As always, if you find Randocity a fascinating read, please leave a comment below and please click the Follow button in the upper right under the Search bar to be notified of any new Randocity articles.
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Rant Time: MagicJack – Scam or Legit?
The magicJack company offers a voice over IP phone service. You can use it with an app on your phone or by a device plugged into an actual landline-type phone. It does require Internet to function. Either way you go, it’s VoIP and they have very questionable and deceptive billing practices. Let’s explore.
Internet Phone Service Choices
If you’re in need of phone services on a device that only has access to WiFi, then a voice over IP service (VoIP) is what you need. There are many different VoIP services available on the Internet. You can even make audio and video calls via Facetime on iOS, via Skype on pretty much any mobile or desktop computer or even via Google Hangouts. For this reason, magicJack is yet another VoIP phone service in a sea of choices.
Why would you want to choose magicJack? Initially, they were one of the lowest priced VoIP phone services. They also offered a tiny computer dongle that made it easy to plug in a standard home phone. That was then. Today, mobile devices make this a different story. Lately, this company has raised their prices dramatically and they’re performing some quite deceptive and questionable billing practices.
911 Service
As with any phone service that offers the ability to use 911, the service must tack on charges to the bill by the municipality. You’d think that part of the invoice that magicJack is already collecting in payment of services would also cover for those 911 services. I certainly did. Instead, magicJack isn’t willing to part with any of their service revenue to actually cover services that, you know, they provide as part of your phone service… like any other phone company does.
MagicJack seems to think they can simply pass on said charges right to you in an email invoice and have you pay them separately. Here’s where magicJack gets firmly into scam and deceptive billing territory.
I’m sorry magicJack, but you’re forcing the 911 service when we don’t really need it or want it on that magicJack VoIP phone line. If you’re going to force this service as part of the overall service, then damned well you need to suck it up and pay the expenses from what we pay you. There is no way in hell I’m going to pay an ‘extra’ bill simply because you are unwilling to use the collected service fees to pay for those bills, like any other carrier on the planet. It’s not my problem that you choose not to do this.
You, magicJack, need to pay those bills to the 911 service. It’s your service, you forced 911 onto my line and now you must pay the piper. If you can’t do this, then you need to go out of business. This means, you need to collect the 911 service fees at the time you collect the payment for your services. And you know what, you already collected well enough money from me to cover those 911 service fees many times over. So, hop to it and pay that bill. This is not my bill to pay, it’s yours.
MagicJack Services
Should I consider magicJack services as an option when choosing a VoIP phone service? Not only no, but hell no. This service doesn’t deserve any business from anyone! This is especially true considering how many alternatives exist for making phone calls in apps today. Skip the stupidly deceptive billing hassles and choose a service that will bill you properly for ALL services rendered at the time of payment.
MagicJack is entirely misinformed if they think they can randomly send extra bills for whatever things that they deem are appropriate. Worse, magicJack is collecting payments for that 911 service, but you have no idea if that money will actually make it to the 911 municipal services in your area. That money might not even make it there and you may still receive a bill. In fact, if the municipality does send you a bill, you need to contact them and tell them to resend their bill to magicJack and collect their fees owed from magicJack, which has already been collected in the funds to cover any and all phone services. If magicJack claims otherwise, they are lying. If you are currently using magicJack’s services, you should cancel now (even if you have credit remaining).
Is magicJack a scam? Yes, considering these types of unethical and dubious billing practices. Even though their VoIP service works, it’s not without many perils dealing with this company. As with any service you buy into, Caveat Emptor.
MagicJack Headquarters
Here is the absolute biggest red flag of this scam company. MagicJack claims their corporate headquarters address is located here:
PO BOX 6785
West Palm Beach, FL 33405
Uh, no. Your headquarters cannot be inside of a PO Box.
Yelp claims that magicJack’s US address is here:
5700 Georgia Ave
West Palm Beach, FL 33405
Better, but still not accurate. This is not their corporate headquarters. This is simply a US office address. Who knows how many people actually work there? We all should know by 2018 just how many scams originate from Florida.
When you visit magicJack’s web site, no where on any of the pages does it show their actual physical headquarters address. This is a HUGE red flag. Where is magicJack’s actual headquarters?
magicJack Vocaltev Ltd (opens Google Maps)
Ha-Omanut Street 12
Netanya, Israel
As a point of consumer caution, you should always be extra careful when purchasing utility and fundamental services from any Israeli (or other middle east) companies. Worse, when companies cannot even be honest about where their corporate headquarters are on their own web site, that says SCAM in big red letters.
Class Action Lawsuit
Here’s another situation where this company needs to be in a class action lawsuit. I’m quite certain there are a number of folks who have been tricked into this scammy outfit and are now paying the price for their unethical and scammy business practices. However, because they are located in Israel, setting up a class action lawsuit against this company may be practically impossible. Better, just avoid the company and buy your phone services from U.S. based (or other local) companies where they are required to follow all local laws.
Rating: 1 star out of 10
Phone Service: 5 out of 10 (too many restrictions, limits call length)
Customer Service: 1 star out of 10
Billing: 0 stars out of 10
Overall: Scam outfit, cannot recommend.
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Don’t rent at Blockbuster Express Kiosks
[Updated: 04/15/2017 — In 2012, Redbox purchased all of the remaining Blockbuster Express kiosks which have now become Redbox kiosks. The original article follows.]
I’ve rented at both Redbox and now Blockbuster. I’ve never had any difficulties renting or returning at Redbox. However, at Blockbuster I had the worst experience when returning my movie. Note, this was the first time I’d ever used Blockbuster’s machine. Note, Blockbuster’s machine sucks.
Poor Vending Machine Design
I’ll start by saying that DVD rentals via vending machine, not the best idea. Yes, that includes Redbox. The issue isn’t renting, it’s returning. If you rent at a store, returning the DVD is actually simple… drop it off in the bin. At a vending kiosk, you’re have to wait to turn in the movie because you have to use the screen to initiate the return function. This means, you have to stand in line and wait until everyone else is done. Stupid.
These machines are monstrous, yet they can’t even provide a proper return mechanism. My experience with Blockbuster returning a rented DVD was horrible. I stood in line 20 minutes waiting to return my movie (singular). After all that, the time was a couple minutes past 9 and Blockbuster still charged the extra $1 fee. Seriously, there is no grace period at all?
The worst part is, however, that when I called customer service, they refused to refund the money. They offered a promo code instead. Hello, no, I want a refund, not a promo code. After the debacle that is the returns process, I don’t intend to rent from their shoddy vending machine ever again. I’d already made that decision right after they charged me the extra day’s fee. This is why I didn’t want a promo code. The bad customer service experience was just the topper that capped it all.
Return Mechanism
These hulking machines are huge. There should be no reason why there isn’t a simple return and go slot (i.e., no waiting). It’s completely ludicrous that you need to wait for someone else to finish their long transaction before you can return a movie. It seriously needs a drop and go slot. A slot that always accepts returns no matter what someone may be doing on the rental side. Their computer already knows that that specific movie copy is tied to my account. There is no reason to have to initiate anything. An always-active returns slot is a no-brainer. Yet, these kiosks don’t have one. Neither does Redbox. However, there are far more Redbox kiosks around. If one is that occupied, I could just drive to another. Unfortunately, with the Blockbuster kiosks, you had to return your discs to the one where you rented. You couldn’t return at just any kiosk even if you did know where another one was.
In this case, the kiosk should shutdown all new purchases for 20 minutes prior to 9PM to allow for express returns. This would put the system into return only mode and allow those only needing to return to push their way through before the 9PM deadline. This prevents those people who want to spend 15-20 minutes hogging the kiosk reading every movie synopsis and hemming and hawing over ever title in the unit from doing immediately before return time.
Blockbuster go boom
It’s no wonder Blockbuster’s kiosks are now a thing of the past. They really had no idea of customer service or how to operate such a rental service to the public. I’ll stick with Redbox, thank you very much. I’ve had no issues with customer service or returns at Redbox. Yet, on my very first call to Blockbuster customer service (I waited on hold for at least 10 minutes), they were unwilling to even do what I requested (refund the extra day fee that they don’t rightly deserve).
So, I called the bank and the bank reversed the charges. Too bad Blockbuster.
Here’s your word of warning. If you want to rent from Blockbuster’s kiosk, you may experience something very similar with returns. Not only is customer service an atrocious process, they won’t even issue refunds when appropriate. Worse, if you go even 1 minute past 9PM when returning, they will stick you for that extra day’s fee (no grace period). I have no respect for Blockbuster and I do not intend to rent anything further from either their stupid kiosk or any store they own.
While these rentals are cheap enough, it’s not worth the hassle when you want to get a refund for ill gotten charges. Believe me, Blockbuster needs to shutter the doors and go away. Let’s hope Redbox makes that happen (and they did) and oh, Blockbuster, you should really take a look at Redbox to see what customer service really is, m’kay?
[03/15/2017 Comment: This article was written before the Blockbuster kiosks were bought out by Redbox in 2012. Thankfully, these Blockbuster kiosks no longer exist. They have all been replaced by Redbox kiosks which are much more abundant and easy to locate and use… thanks to the Redbox app. I leave this article up as a history of how Blockbuster kiosks functioned and as a testament to how bad Blockbuster’s customer service was at the time.]
Is Obama hostile towards big business?
To answer this question, we need to delve a little deeper. Note, I am neither condoning nor praising Obama’s handling of his regulatory efforts. However, I would like to point out certain corrections that do need to be made.
“The truth is that not even the Franklin Roosevelt administration was as hostile to and ignorant about free enterprise as this [Obama’s] administration is.”
–Steve Forbes.
But, is Obama really hostile towards business? Or, is he making needed corrections? There is a fine line here. This issue also points out a serious problem in politics today. That problem is, you guessed it, money. Without money, the world doesn’t work. Without money, candidates don’t get elected. Without money, businesses don’t sell things and make money. Back up the train.. Businesses make plenty of money without governmental help. The trouble is that businesses want to be able to make laws that enable their businesses to make more money and then have the government be lenient with them when issues arise.
The reality, though, is that like the separation of church and state, the government now needs separation of business and state. The two are oil and water, they don’t mix. Government needs to be able to make law without interference from any party. But, businesses have deep pockets and hefty lawyers. These two elements help elect officials and help sway these same officials into making good on promises they made towards these businesses during the election.
Obama’s corrections
While I don’t agree with every single thing Obama has done, I do agree that change is necessary. The change that he is making is intended to correct the issues that led to the economic downturn. The trouble comes with statements from people like Steve Forbes. Mr. Forbes believes that he is the end-all-be-all-know-it-all when it comes to all-things-business. The trouble is, he doesn’t. Yes, he runs a successful magazine, but that doesn’t make him an authority. That makes him a successful business owner.
Obama is walking that fine line. A fine line that shouldn’t even be necessary. But, there it is. The line that’s there to help Obama help the economy, help spur business and growth and reduce the chances of a repeated failure. At the same time, the line is there to show that government values business, but isn’t there to socialize it. The trouble is, this economic downturn was of our own making. By our, I mean Wall Street. The housing bubble was just that, a bubble. Bubbles eventually burst and this bubble was no exception. It’s not as if analysts and intelligent minded people couldn’t see the handwriting on the wall. When the mortgage interest rates got down to 1% and all of those ARM and specialty loans were being issued like water flowing down the Mississippi, trouble was inevitable. We just didn’t know that banks and insurance companies were tying their financial soundness to these extremely risky loans using credit default swaps.
Until the bubble burst, no one really knew just how deep the rabbit hole went. Then, everything came crashing down and all of the nasty subprime mortgage and credit default swap issues came into view in their all fugly detailed glory. The first evidence of that was Bear Stearns followed by AIG (and the subsequent governmental bailout). I still think they should have let AIG fold, I digress.
Government and Business
It’s high time that government distanced itself from corporate businesses. It’s high time congress made laws to separate government from business (including political support). It’s high time that government stopped being a pawn for corporate businesses. Forbes clearly seems to think that Free Enterprise requires socialism to function. Free Enterprise is not part of and does not need socialism. Free Enterprise means that businesses can do whatever they need to do (within the limits of the laws) to make their business succeed. Clearly, there have not been laws enabled that have dramatically impacted Free Enterprise. The laws that have been enacted have been placed there to prevent corporations from producing risky investment vehicles with a high likelyhood of crashing down again. If businesses are now floundering, it’s not because of laws. It’s because corporations have lost their way and are still expecting handouts. Well, you can keep your hand out, but don’t expect the government to be dropping any coin in it.
Corporations have relied, no… depended on the US Government for handouts. That time needs to end. Subsidies for business need to go away. Businesses need to fend for themselves just like Free Enterprise mandates. If a business can’t make it on its own, then let it fail. I’ll repeat, LET IT FAIL. Failure is also part of Free Enterprise. Businesses that will succeed, will succeed because they produce a good product or service. Businesses that fail, will fail because they don’t produce good products or services.
Lost our way
America, and specifically corporate enterprises, have lost their way. For far too long have big corporations depended on favorable governmental conditions (sounds like a weather report) to help them stay in business. Well, that train has left (and must leave). It should be solely up to you and your business practices alone to make or break your company. It is the quality of your products, services and support that makes people want to buy your products or invest in your company. Nothing has changed about this aspect of Free Enterprise.
We need to go back to a time when quality was the key. When providing a superior product was the answer to getting people to buy things. If that also means deflation, then so be it. Businesses need to find their way by learning how to do more with less. How to manage their staff better and stop over-hiring. At the same time, many of them need to stop under-hiring and also value the employees that they have right now.
The key to keeping your business flowing is by keeping your employees active, productive and happy. Morale is a big problem in companies during any downturn. Once fear sets in over the next reduction in force (RIF), then morale falls to all-time-lows. No, taking the employees on an outing doesn’t boost morale. The way to boost morale is to stop RIFing the staff out the door. Yes, I know it gives a temporary boost to the stock price and makes the shareholders happy, but that’s a temporary fix with limited effects. Once the dust settles, the employees who are left become disgruntled, unhappy and produce less. This is completely backwards thinking. Which is why business has lost its way.
Shareholder value vs quality products
I know, someone’s going to say that it is all about ‘shareholder value’. That may be the way things seem now, but it is wrong. Currently accepted actions that lead to improved shareholder value tend to undercut production, stifle innovation, reduce profit margins and lower productivity. Why would you intentionally do this to your business? So, while these measures may seem to help the stock price, it does nothing to help the company improve its quality of products and services. In fact, in the long run, these actions almost always negatively impact the bottom line. So, the fundamental question is, are you in business to make the shareholders happy or are you in business to sell quality products and services? This fundamental question must be answered.
The true answer to this question also shows that Free Enterprise priorities today are all wrong. It used to be that the customer is #1. Now, shareholders are #1 and customers are #2. This is both wrong and stupid. Until businesses go back to the idea that the customer is #1, corporations will continue to fail and need governmental subsidies. While shareholders are considered #1, there is really no such thing as Free Enterprise when it comes to multi-million dollar corporations… which is why they always need a handout from the government.
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