“Rebate promotion may increase price of bed.”
That red flag is contained within the fine print at the bottom of the screen during commercials for a Craftmatic adjustable bed. The way the deal is presented is that you, the consumer, calls a toll-free number to get some information pack about the bed. In the packet is a $200 rebate coupon.
That piece of fine print sucks. Using common sense, that means that they raise the price of the bed in order for you to get that “terrific” $200 rebate.
That’s not really a rebate, is it?
Others have noticed the commercials, too. According to Ohio Attorney General Jim Petro, sales representatives told customers they were getting a discount or special price when the company has no fixed price for the beds. He also stated that “Craftmatic engaged in high-pressure tactics, misleading advertising and claims that the beds would resolve consumers medical problems, which were not medically verified.”
Accordingly, the State of Ohio recently filed a lawsuit against the maker and distributor of Craftmatic adjustable beds. The suit alleges that Craftmatic engaged in false claims of medical benefits, deceptive price comparisons, false advertising, making false or misleading statements, high pressure sales tactics, Home Solicitation Sales Act violations, deceptive warranty practices, direct solicitation violations, bait-and- switch advertising, failure to disclose material financing terms, failure to disclose material contract terms, illegal attorney fee provision in consumer contracts, and unfair and deceptive and unconscionable business practices.
Capatalism at its worst.
In July 2005, Craftmatic settled with the State of Ohio for $425,000 ($200,000 for consumer reimbursements and the remainder for civil penalties and attorney fees to the state), and agreed to “significant changes in its business practice — whatever that means. Frankly, I think they got off lightly. Craftmatic claims to have sold over one million beds, each costing thousands of dollars. Assuming an even distribution of sales, that’s only $10 per Ohioan customer.