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Beware of CBD gummy ads exploiting household names to defraud consumers, experts warn

A fake ad featuring the name and image of CTV News Chief Anchor and Senior Editor Lisa LaFlamme is seen here. (Submitted) A fake ad featuring the name and image of CTV News Chief Anchor and Senior Editor Lisa LaFlamme is seen here. (Submitted)
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TORONTO -

From oils and creams to capsules and gummies, there appears to be countless online ads for cannabidiol (CBD) products, with many exploiting household names in an effort to defraud unsuspecting consumers.

Early in November, Maureen stumbled upon an ad for CBD gummies on Instagram that appeared to feature the name and image of CTV News Chief Anchor and Senior Editor Lisa LaFlamme.

LaFlamme does not represent nor endorse any CBD products, including gummies, or any other products or services.

鈥淗er name came up and it gave a story,鈥 Maureen, who is 65 years old and lives in Mississauga, Ont., told CTVNews.ca in a phone interview. 鈥淚t actually said how she was sort of in trouble because CTV wasn鈥檛 happy with her doing this kind of stuff.鈥

Maureen, who asked that her full name not be used, tapped on the ad and was brought to an order page. She initially didn鈥檛 go through with the purchase but was then offered a better price of $4.95 for a bottle.

She made a purchase, and upon completing the checkout process received a receipt of $4.95 for the gummies. About 20 minutes later, she received another receipt, this time for $52.85, which included an order of gummies, oil drops and skin cream.

鈥淚 called them, I said I didn't order the cream. I don鈥檛 want the cream,鈥 she said. 鈥淸They said] 鈥榃ell, that鈥檚 what you ordered.鈥 I said 鈥楴o I didn鈥檛鈥. They said, 鈥榃ell you clicked on everything.鈥 I said 鈥楾here was one thing to click on and that's what I clicked on鈥.鈥

Further to that, she says the customer service agent indicated she would be charged for more products in the future.

鈥淭hey told me I鈥檒l keep getting orders. I said, 鈥業 don鈥檛 want it鈥. I said 鈥楥ancel me鈥,鈥 she said. 鈥淸They said] 鈥極h, we can鈥檛 do that. You have to call back [at a later time]鈥.鈥

Maureen was refused a refund on the products she says she didn鈥檛 order.

鈥淚 never do stuff like this,鈥 she said. 鈥淚 should have known better.鈥

Although she doesn鈥檛 recall the name of the website through which she made her initial order, her receipt shows the URL perfecthealthexperience.com. The site was displaying a 鈥403 Forbidden鈥 error when trying to access it at the time of publication.

CTVNews.ca called the customer service line. A representative who identified themselves as Daniel said the company he works for has nothing to do with the marketing of products.

鈥淲e are a third-party customer service that provides assistance to several brands,鈥 he said. 鈥淲e actually do not have anything to do with how the promotions are being presented.鈥

Daniel refused to name his employer.

He also said customers who call about being charged for extra products may have ordered discounted items as part of a bundle.

Daniel wouldn鈥檛 divulge any of the brands his company represents, save for one, 鈥淢ax Healthy Products.鈥

Meanwhile, days before speaking with the representative, CTVNews.ca received a message from a reader saying a website with the URL maxhealthyproducts.com was claiming LaFlamme endorsed a CBD gummy product. Like perfecthealthexperience.com, this website was also displaying a 鈥403 Forbidden鈥 error at the time of publication.

These instances aren鈥檛 the first time LaFlamme鈥檚 name and image have apparently been falsely used to promote CBD products.

鈥楾HEY MADE IT SOUND LIKE SHE WAS THE CEO鈥

In early May, Tricia was perusing Instagram when she saw an ad for a free bottle of CBD gummies that appeared to feature the name and image of CTV News Chief Anchor and Senior Editor Lisa LaFlamme.

LaFlamme does not represent nor endorse any CBD products, including gummies, or any other products or services.

鈥淭hey made it sound like she was the CEO of the company,鈥 Tricia told CTVNews.ca during a telephone interview from her home in Peterborough, Ont. 鈥淚t made it sound like she was saying that they [the CBD gummies] had saved her life and so she decided to start up a company.鈥

When she clicked on the ad, Tricia, who requested that her full name not be used for privacy reasons, said she was taken to a website with the URL verdenaturalbest.com, which is no longer active. She then proceeded to order one bottle of CBD gummies for $39.95. She didn鈥檛 see an option to claim an additional bottle for free, but says she decided to order one anyway.

Tricia, who is in her 70s, said she鈥檇 been thinking about buying CBD gummies or oil for a while to ease symptoms from the progressive arthritis in her spine.

After she had given her credit card information and completed the checkout process, Tricia realized she had not received a summary of her order.

Instead, her account on the Verde Natural Best website only showed a confirmation of her order without any total for the amount she would be charged.

鈥淭hat鈥檚 when the bell rang in my head, like 鈥楬ow stupid can I be to think that it was Lisa LaFlamme at the head of this company?鈥欌 Tricia said.

The next morning, when Tricia called the number listed on the website to cancel the order, she said the customer service representative told her that it was too late because the order had already been processed and shipped.

After several more days of calling, she eventually spoke to one representative who told her that she was being charged C$334 for six bottles of CBD gummies as part of a subscription, even though she thought she had only ordered one bottle.

Tricia said she asked about returning the items and the representative told her she would only receive a refund of 50 per cent of the total and she would be charged an additional 15 per cent 鈥渟tock return fee.鈥

She said her credit card company told her they would have to wait two weeks before they could put a stop payment on the charge.

Finally, Tricia said she was able to obtain a full refund for the order after she called the customer service representative again and accused the company of using LaFlamme鈥檚 name and image without her consent to promote CBD products.

When CTVNews.ca reached out to the customer service line for Verde Natural Best, a representative answered who works for a distribution company called Natural Brands USA, which handles consumer inquiries for multiple companies.

The representative, who didn鈥檛 provide his name, said they鈥檙e not affiliated with the ads that feature celebrity endorsements.

When asked if the companies he represents send consumers more products than they ordered, as in Tricia鈥檚 case, he denied it.

鈥淲hat she ordered is what she gets,鈥 he said. 鈥淢aybe, actually, she did something wrong with placing the order in the website. That鈥檚 probably most of the reasons for those products to be added to the order.鈥

When the six bottles of CBD gummies arrived, Tricia said she didn鈥檛 even try them before sending them to the Toronto return address included with the shipment.

鈥淚 should have known better. I know better,鈥 she said.

While Tricia said she should have recognized a potential scheme, she鈥檚 far from alone.

IMPERSONATING CELEBRITIES ON THE RISE

In Canada, there has been a marked increase in complaints about these types of schemes in recent years.

Steve Baker, a former investigator for the U.S. Federal Trade Commission (FTC) and an international investigations specialist for the Better Business Bureau (BBB), on subscription traps and free trial scams for the BBB in 2018. In the study, he cites data from the Canadian Anti-Fraud Centre (CAFC) that showed a dramatic uptick in complaints about these types of scams. 

According to the CAFC, they received 518 complaints from March 2016 to March 2017, up from just 54 complaints from 2011 to 2016. Of those 518 complaints, 474 people lost money, with a total loss of C$192,419 and an average loss of C$248.

More recently, the CAFC said they received 2,557 complaints in 2019 about broader merchandise scams, which include subscription traps and free trial scams, that resulted in more than $2,699,000 in losses. In 2020, the CAFC said there were 4,056 reports of merchandise scams resulting in more than $9,730,000 in losses.

In the U.S., over a 10-year period, Baker said there were more than US$1.3 billion in losses affecting more than a million victims in the U.S. due to such scams.

鈥淭here is a massive industry of deceptive free trial offers. I think almost anybody has run across them by now,鈥 he told CTVNews.ca during an interview from St. Louis, Miss. 鈥淭hey simply use the names and supposed endorsements of celebrities without permission.鈥

In the past few years, household names, such as Tom Hanks, Ellen DeGeneres, Don Lemon, Katie Couric, Sandra Bullock, and Dr. Mehmet Oz among others, have spoken out to refute ads claiming they have endorsed certain products, including CBD products, keto and diet pills, and anti-aging creams.

Baker said they use celebrities or well-known journalists in the product ads because they know the public will be more likely to click on them.

鈥淭hey realize that people really do put more trust in something that鈥檚 endorsed by a celebrity that they鈥檙e familiar with,鈥 he explained. 鈥淭hey think, rightly, 鈥楾he celebrity wouldn鈥檛 really endorse it unless it probably worked鈥 so that gives people a lot more confidence that it works.鈥

In a statement to CTVNews.ca, the CAFC said, 鈥渟cammers try to impersonate all celebrities鈥 in what they call a 鈥渕erchandise continuity scam,鈥 which is: 鈥淎ny scam that involves a victim being signed up for a subscription resulting in multiple and subsequent monthly charges on their credit card after buying a product or service.鈥

The CAFC said such schemes typically involve email, an online pop-up, or ad that relates to a free gift or product. The consumer then fills out a survey or questionnaire and enters in their credit card details to pay for shipping for the free product.

鈥淭here are subsequent charges on the CC in the following months. Mostly related to prize, merchandise and service scams and often related to known company names or even celebrity names being used,鈥 the CAFC said.

In general, the CAFC said the emails or ads don鈥檛 target a specific group, but try to scam anyone willing to click on the link and provide their credit card information.

'THESE COMPANIES DON鈥橳 WANT TO BE FLAGGED'

That鈥檚 exactly the reason why Terry, who requested that only his first name be used, decided to order three bottles of CBD gummies for $39.95 in order to receive three free jars. He said he made the order after seeing an ad that featured a supposed study on the benefits of CBD.

The 68-year-old from Ottawa said the study in the fake ad cited Canadian news outlets, including CTV News, CBC News, The Globe and Mail, as well as the University of Toronto.

鈥淚鈥檝e never used these products. I鈥檝e never had a desire to use them, but my arthritis hurts so badly,鈥 he said during a telephone interview with CTVNews.ca.

鈥淲hen I saw CTV and CBC, etc., etc. and the University of Toronto, I figured, you know what, these are major Canadian legitimate organizations. I felt that if you thought that this was a really effective product, why not try it?鈥

After Terry placed his order, however, he realized something was wrong when the email confirmation he received showed an invoice for US$294.56 or C$357.

Terry called the customer service number and learned that he had been signed up for a monthly subscription for a CBD oil and cream, which is why his charges were so high. He said he was told the company would not cancel the order because it had already been shipped.

He spent the next 16 days disputing the charges before his credit card company became involved. He said as soon as his credit card company launched an investigation, he received a full refund and confirmation that his account with the CBD company had been cancelled.

鈥淚t demonstrates that these companies don鈥檛 want to be flagged,鈥 he said.

Although he complained, Terry said there could be other consumers out there who failed to check their invoice until it was too late or they paid off their credit cards without noticing the extra charges.

Terry said he never bothered to try the CBD gummies, oil, and cream he received in the mail and sent them back to the return P.O. box address located in Toronto.

CTVNews.ca reached out to a customer service line associated with Indigo Ultra Shop, which is where Terry says he purchased the CBD gummies, and was directed to the same distribution company, Natural Brands USA, as before with Verde Natural Brands.

This time, a customer service representative who would only give the name Ezzy said their company is not affiliated with any 鈥渁rtists鈥 right now when he was asked about the ads. He said he would direct CTVNews.ca鈥檚 questions to the company鈥檚 head office, but there has not been a response as of the time of publication.

Baker said it can be difficult to track down who is behind some of these companies because the websites themselves can appear differently depending on how they鈥檙e accessed. He said if the URL is typed into a browser, it may appear legitimate without any deceptive claims, but if the same website is visited through a link in an email, text message, or social media post, the website may have different information on it.

What鈥檚 more, Baker said a lot of the time the websites will only be up for a few days before they鈥檙e taken down or changed.

鈥淭hese folks are very clever. They鈥檙e extremely computer savvy and it鈥檚 something that makes it more difficult to go after,鈥 he said.

HOW TO PROTECT YOURSELF

While it may be difficult to obtain a refund or track down those responsible for these types of merchandise continuity scams, there are ways to protect yourself from becoming victim to them in the first place.

The BBB recommends:

  • Research the company online. See what other people are saying about the company鈥檚 free trials. Complaints from other customers can tip you off to 鈥渃atches鈥 that might come with the trial.
  • Understand what happens after the free trial ends. Always read the terms of the offer before signing up. If there aren鈥檛 any terms or it鈥檚 difficult to understand what you鈥檙e agreeing to, don鈥檛 sign up and don鈥檛 provide your credit card information.
  • Watch for the fine print. Be aware that promotions or free samples are often not 鈥渞isk-free.鈥 Look for any fine print that says you will keep getting products and you will be charged for them.
  • Be skeptical. Be wary of any endorsements from a celebrity or well-known figure or organization. Scammers often fake these endorsements.
  • Report losses to credit card companies. If you pay with a credit card, you can dispute fraudulent charges. Keep an eye on your monthly statements and notify your credit card company of any suspicious charges.

Baker stressed that he would discourage anyone from doing a free trial or signing up for a free product from any type of medical or nutraceutical company online.

For anyone who believes they have been the victim of an online scam, Baker recommends they alert their credit card company and contact local law enforcement so they can investigate.

In addition to reporting the fraud to local police, victims in Canada can also file a report with the or by phone.

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