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Bill would ban directory scams

Published (3/11/2010)
By Nick Busse
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The next time you order flowers from your local florist or call a locksmith in your area, you might want to make sure they’re actually local; otherwise, you could be paying for more than what you’re getting.

A new kind of scam has emerged in which people operating businesses misrepresent their locations to make customers think they’re local, when in fact they’re located in another city or even out of state.

Customers who place an order are overcharged by the out-of-state entity and then have their order referred to a local business. The local company does all the work, and the person running the out-of-state business makes all the profit.

Rep. Steve Simon (DFL-St. Louis Park) argues it’s a deceptive business practice, and sponsors a bill that would put a stop to it.

Simon sponsors HF3277 which would make it illegal for companies to misrepresent their locations in phone directories and/or on the Internet. The House Commerce and Labor Committee approved the bill March 9 and referred it to the House Civil Justice Committee.

Simon said such operations often take out advertisements in phone books or turn up in Internet search results with phone numbers that purport to be local, but in fact are routed to a call center somewhere else. Addresses given for such businesses often turn out to be for local post offices or other unrelated facilities.

Kym Erickson, president of the Minnesota State Florists Association, said the scam has become widespread and affected many florists in the state — including her. She related the story of a customer who paid $98 for a $42 order from her shop; the other $56 went straight to the non-local company.

No one testified in opposition to the bill.

A companion, SF3102, sponsored by Sen. Sandy Pappas (DFL-St. Paul), awaits action on the Senate floor.

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