Congratulations, you’ve won a free $1,000 gift card – just click here to redeem it!

If you clicked on this story for your “free” gift card, you’ll definitely want to keep reading. I’ve issued plenty of warnings about “free” products and some of you, dear readers, think I’ve gone too far.

After all, aren’t some of the best things in life free?


But you might also want to consider a tale of two companies — one in South Carolina, the other in California — which allegedly hired affiliate marketers to send millions of spam text messages to consumers around the country.

The messages included text such as, “Dear Walmart shopper, your purchase last month won a $1,000 Walmart Gift Card, go to [website address] within 24 hours to claim.”

Last month, the Federal Trade Commission (FTC) cracked down on the operations, with the defendants agreeing to pay $2.5 million in settlements.

This alleged scheme offers a sobering warning, not only about come-ons involving the word “free,” but also about what might be gained from offering something that, on its face, actually appears to be completely free.

When consumers clicked on the links in the spam text messages, they were taken to landing pages operated by one group of defendants, asking them to “register” for the free prizes they had been offered.

The registration process, the complaint alleges, was actually a method by which the defendants collected information about the consumers that was then sold to third parties.

But, as you’ve probably guessed by now, no one received a $1,000 gift certificate.

After victims provided their personal information, they were taken to sites owned by another group of defendants. Consumers were told that to win the prize they had been offered, they were required to complete a number of “offers,” many of which involved either paid subscriptions to services, or applying for credit. The FTC complaint alleges that the defendants were paid by the companies that advertised these offers.

Pretty tricky, huh?

The case underscores an argument I’ve been making for some time as a consumer advocate. Your personal information — your name, address and phone number — is extremely valuable to a business. Companies will pay for that information. Add data about your buying behavior, and your personal information can be worth hundreds of dollars to a company.

Now, I’m not saying this is always a terrible trade-off, but many consumers feel as if their personal information has no value and then they wonder why their inbox is filled with spam or why they’re getting all kinds of unsolicited phone calls at dinnertime. Well, maybe it’s because that “free” service monetized your personal data. Welcome to the 21st century.

This question comes up most often in the context of a loyalty program, which promises you a “free” airline ticket or hotel stay after spending a certain amount of money. Some argue that they would have given the company their business anyway, so the ticket truly is “free.”

I disagree.

Even if you don’t spend any extra money on a more expensive airline ticket, you’re still giving the airline valuable information about you and your purchasing patterns, and it can sell that data to a third party, and often does. Remember that the next time you get a credit card offer in the mail. Someone paid for your address and identified you as a hot prospect for that rewards card.

Even if you don’t subscribe to my view of “free,” grant me this: The word “free” can be a warning, as when a company offers you a “free” $1,000 gift card. Also, offers of “free beer” and “free puppies and an espresso” (for unattended children) should be viewed with suspicion. Yes, that’s a joke.

But it’s no laughing matter, in the end. The FTC didn’t say how many consumers were duped into giving away their personal information to these companies, but one is too many. The takeaway is obvious: Don’t hand out your personal information to strangers and carefully consider any “free” offer. Chances are, someone is going to eventually pay for it — and that someone could be you.

Do you believe a company when it offers something for "free"?

View Results

Loading ... Loading ...

Christopher Elliott

Christopher Elliott is an author, journalist and consumer advocate. You can read more about him on his personal website or contact him at Got a question or comment? You can post it on the new forum.

More Posts - Website - Twitter - Facebook - LinkedIn - Google Plus

  • backprop

    Using this logic, has anyone ever, in the history of the world, gotten anything “Free”?

  • sirwired

    We would all be wise to remember the universal law of privacy on the internet:

    “If you are receiving something for free on the internet, you aren’t the customer, you are the product being sold.”

    Even if something isn’t a scam, you still aren’t getting “something for nothing”. (i.e. Everything Google offers, Facebook, whatever…)

  • Alan Gore

    You can tell it’s a scheme (insert mustache-twirling graphic here) whenever the “registration” process involves entering a bank account or credit card number. Before you can finish your coffee, the Nigerian price who contacted you will be out shopping on your dime.

  • Extramail

    What I have found most interesting lately is that I get different spam offerings to different email addresses. My email address for my “junk” mail gets the Viagra product offers. My email address that is just for “fun” gets the Nigerian prince and winning lottery offers. My personal email address that I use for friends gets the least amount of spam emails but still receives the online pharmacy offers. Seeing as how I’m female, I don’t need the Viagra; I’ve never bought a lottery ticket in my life nor have I registered in Britain to win a lottery; and, I don’t take any regular medications that need to be ordered online. And, oh I would give anything for the “do not call” list to really mean do NOT call me. Caller I.d. Is a much-appreciated feature. I’d rather be taking the trip to England with money a spammer had to pay me for making illegal phone calls or email solicitations!

  • Chris Johnson

    Emails like this go straight to my spam folder.

  • LonnieC

    I thought the First Law on Internet Privacy was: “Nothing, absolutely nothing, ever, is private on the Internet”.

  • Stephen0118

    I just wish the Do Not Call List covered everything, including non-profit organizations and charities. Unfortunately they’re exempt, even though the charities use a telemarketer.

  • Nikki

    I knew that the Do Not Call list wasn’t going to cover everything (do they ever, lol) – so it was one of the many reasons I got a phone number through Google Voice some years ago. That proved to be one of the best tools ever. – all my calls go to Google Voice, I listen to the voicemails I want to listen to, and chuck the spam calls right where they belong – in the trash. Having the Google Voice number and using that as my “home phone” put control of the phone right back into my hands. If you do not already have a Google Voice number, I’d strongly suggest getting one, and begin using that as your main contact number.

    One more thing about Google Voice: if someone leaves a voicemail or text message on that number, it’s on your account forever, if you should need it for legal or other reasons. (unless you delete it, of course) I’ve already heard of people that used transcripts from Google Voice in court with positive results.

  • Joe Farrell

    I say this alot . . .stupid is as stupid does.

  • jim6555

    Alan, as the posting points out, there doesn’t have to an attempt to steal your money to make the transaction a successful one for the spammer. Many times, all they are interested in are your name, street address, email address, phone number and information about your buying habits. They can then bundle your information with those of hundreds (or thousands) of other people and sell it to marketing companies. Those companies will then spam you or telemarket you in the hope that you will buy their product. I’m sure the people who are regular readers of Chris Elliott’s blogs already know this but there are new people who don’t. If you get a call from a telemarketer and don’t want to be called again, don’t say “take me off your calling list”. They will call again and again if you do that. I will ask them if they have a “do not call” list. (By law, they are supposed to have one). I then politely ask them to “PUT ME ON YOUR DO NOT CALL LIST”. Once they agree to that, I almost never hear from that organization again. This seems to work to stop repeated calls from charities and newspapers as well as business telemarketers.

  • PolishKnightUSA

    I set up my personal email to go through google mail. Yes, Google (and the NSA) scan it, but it’s a small price to pay for an email address that’s 25 years old that the spammers have long known is valid and I can’t hide it from them anymore. Nonetheless, I get maybe 1 spam email in my inbox a month or so. It’s rare. In my spam folder, I get only about 40 a day (it used to be 10 times that!) and typically about 5 emails a month that are false positives (put into spam when they’re not.) I scan through it every month or so and check and teach google what is spam and what’s not.

    Since the total amount of spam is now down to a 1/10th of what it was a few years ago, I suspect that the spammers are slowly being starved to death but apparently, there are still some suckers making it worthwhile.

  • Joe Farrell

    If they REALLY wanted to solve the DNC list problem – as in contractors and contractor lead services routinely ignoring it – they would add a private right of action for $500 plus attorneys fees per violation. You get a call, you figure out who it is, you turn your friendly neighborhood attack dog, er, lawyer, at them, the telemarketing industry would be dead within a year. If you are not on the list, you are fair game. If you are, and they cannot prove they accessed the list before making the call, $500 plus fees.

    When I get spam from an identifiable entity, I ALWAYS reply. I inform their customer service team that I charge $500 per email for reading, cataloging, assigning priority and deleting emails plus attorneys fees and costs, and their sending me an email at any time in the future constitutes acceptance of my terms. I couch it in terms of their violating their online privacy policies.

    It is AMAZING how fast senior level people respond to that and tell me I will not receive another contact from them. Now – the only company that has been sued multiple times is ADT Home Security – they got sued three times in the last 4 years in small claims court and paid up every time.

    I sued this one contractor and he sent his wife to court to say that ‘they did not know’ what their marketing company was doing. The judge laughed at that excuse. I got $1526 from them. I bet he stopped using lead generation services after that –

  • emanon256

    I once found a $20 bill on a public sidewalk. I consider that free.

  • emanon256

    Or, a fool and their money are soon parted.

  • Christopher Elliott

    Well, if it’s any consolation to my critics, this story has led to the demise of one of my editorial relationships. I’ll have details soon.

  • Jeanne_in_NE

    Oooh – I’m all ears!

  • emanon256

    That’s crazy! Hopefully it’s a good change.

  • sirwired

    That’s very surprising… this seemed like an utterly innocuous article.

  • Judy Serie Nagy

    YUP, freebies or privacy, we internet users are fair game. Keep reminding people, Chris; I know all kinds of otherwise intelligent people who cannot resist these kinds of scams.

  • sirwired

    Yeah, my spam folder doesn’t fill up nearly as fast as it used to… I think many of the spammers have finally figured out there really isn’t any point in sending e-mail to any address with the “major” webmail providers; the spam filters are getting good enough that few copies of the e-mail will ever get through. There’s simply more fertile fields of crime over the internet, and they’ve moved on.

    As a side note, when I browse through some of the laughable crap in my spam folder… the offers of romance, stolen Nigerian oil riches, bequest of a dying widow, an ATM card from the UN, a foreign lottery I never entered, etc., I always ask myself, who exactly ARE the gullible morons that “bite”? I know they must exist, or the notes wouldn’t be sent…

  • Mark Carrara

    Three problems with DNC list:
    1. Politicians are exempt, with the constant campaign cycles they always seem to call
    2. If a business has a ‘relationship’ with you they can call
    3. If it is a scam they are already doing something illegal so they don’t care. Time share scams are a good example

  • $16635417

    But…had you thrown out your back picking it up, and subsequently had an array of doctors & specialists to visit, procedures to undergo and prescriptions to fill…it would not have been. You “paid” for it with the risk you took picking it up…even if there were no consequences….this time. :)

  • PolishKnightUSA

    Google “Mary Winkler”.

    I think they prey upon the elderly as well. I saw a news story about numerous elderly people who thought they had won a million dollars because Publishers Clearing House says on the envelope: “Claim your million dollar prize!” and some had already started spending the money they thought they had won.

    In my case, my email address is highly personalized and I have my own domain, but it’s hosted by gmail/google FOR FREE (Oops, I guess there is nothing for free, right?) For webmail, I have to put up with banner ads but it’s tolerable and at this point, I don’t even “see” them anymore (I have a kind of mental block that doesn’t notice them) and google scrapes my email for targeted banner ads. I’m ok with it.

    I have noticed that despite my email address being 25 years old, I get less spam than my wife who went on a contest entering binge a few years ago and I guess they have labeled her prime spam material while my habit of only giving out my email address to trusted senders has slowly whittled away some of the spammers. They surely still know who I am, but their uncertainty that I haven’t shown up on their radar yet may be causing some of the lists to drop me.

    Final tip: In gmail and other services, you can create aliases. I made one called “contest14” for all the contests my wife and I enter and also any other temporary correspondence I engage in. Then after a year or so, I delete it and move to the next year. Whala! Much of our spam email gets bounced back to sender.

  • Fishplate

    You had to stop and pick up the bill. That was time you could have spent doing something else.

    You made an investment. It had an excellent return. But that return was’t “free” by Chris’ definition.

  • Cybrsk8r

    Add to that, “On the internet, everything you do online, will live forever, somewhere” If you don’t believe that, ask the 20-something who didn’t get his dream job because of questionable Facebook photos.

  • Cybrsk8r

    When I get a call from a tele-marketer, I suddenly say, “Hold on, I have something burning on the stove!”. I then put down the phone and go back to what I was doing.

  • Daddydo

    honest to goodness, at 3:42pm today, while reading this post, I got a text ” Please claim your tickets to the Bahamas soon! Call (954)_507_7628″ (I copied it exactly as sent) OK, lets all call the number and claim our “free” tickets and party on.

  • emanon256

    This was when I still lived in NY, so it also may have had crack on it and I had to go to addiction counseling, and I may have been beaten by a homeless person for getting to it before them.

  • emanon256

    I was waiting to cross the street at the time, so there wasn’t much else I could have been doing. But…

  • $16635417

    Kind of bummed about the no call list. I used to do stuff like that. I don’t get telemarketing calls anymore. I tell pollsters I’m in the media, so they don’t call anymore. I had fun messing with them, I miss that sometimes.

  • Mel65

    I got a similar one at 1:37!: Enjoy your free cruise! With a 312 phone number to call to get more info. It came from Grrr since it came from something other than a phone number I can’t block it….

  • Nigel Appleby

    One more issue with DNC lists – US lists do not apply to Canadian call centres and vice versa. So Canadian call centres can call US phones and how can they be stopped?

  • Stephen0118

    I know what you mean. I use VOIp and caller ID. If I don’t recognize the number, I let it go to voicemail. Problem is these telemarketers use numbers within my area code and sometimes I unknowingly answer because it could be someone from my church calling me to ask questions.

  • $16635417

    You let your guard down. What if it was a trap?

  • Carver Clark Farrow


    Besides the usual nothing is free rant, its pretty vanilla. Nothing to get steamed over. Sorry about that.

  • Christopher Elliott

    It’s a good change. I’ll share more soon.

  • Fitted Technology

    It is sad because they target people who just dont know any better.. I do have to say one time I did get a free sample at costco..