Saturated with cash and hit-and-run sales strategies, outsiders continue to book Memphis hotels for seminars designed to sucker Mid-South consumers.
The hotels are more than willing to accommodate them.
Twice in two months, the Action News 5 Investigators have been alerted to seminars by out-of-state outfits whose deceptive sales practices have been well-documented and whose companies have been sued by one or more states' attorney general.
The latest is National Grants Conferences (NGC) of Boca Raton, FL. It scatters seminars all over the country, convincing attendees to pay $999 for access to sources and services that can help them secure government grants.
"I was really sold on it," said Karen Hall of Cordova, TN. She attended NGC's July 28 seminar at the Holiday Inn Select Memphis Airport. "I felt I was going to be able to have grant-writers and attorneys. They were going to be able to show me grants that you weren't aware of.
"They were very good salespeople."
NGC has a "F" rating with the Better Business Bureau. According to the bureau's report, it has generated 189 complaints in the last three years. Most of the complaints are consumers who said they were led to believe the $999 got them into NGC's grant program, but then they discovered they had to attend a second seminar where they must spend $3,000 to $5,000 on software to help secure government funds.
"In most cases, grants are not given to individuals," said Randy Hutchinson, President of the Better Business Bureau of the Mid-South. "If they are, there aren't fees that need to be paid, and you can generally find that same kind of information at the library or to call the granting foundation or to call the government."
Records show in 2006, the Vermont attorney general sued NGC's parent company, Proven Method Seminars, LLC, "...for failure to provide adequate notice of consumers' right to cancel their purchase of 'government grants' training program materials costing $999.00." The company settled the suit, agreeing to offer refunds to Vermont customers and to pay the state $65,000 in attorney fees.
The settlement also bars NGC "...from stating or implying that consumers are likely to obtain government grants or loans through its program without first possessing factual substantiation that this result is reasonably likely."
"It appears that the company is just misleading people about the success rate of their product," said Hutchinson.
The BBB report also says Proven Method Seminars, LLC, filed for bankruptcy last year.
NGC sounds a lot like the case of StoresOnline.com, detailed in this Action News 5 investigation:
Jeff Jacobs, manager of the Shelby County Clerk's Business Tax Division, said both companies do not have to have what's called a "transitory vendors license" because they do not sell products on site.
"If they're selling something that's going to be delivered in the future (like support services for obtaining grants), they don't have to have a (vendor's) license," said Jacobs.
And if they have cash to spend, the hotels' registers will be ringing.
"In this economy, the hotels need the business, and as long as the companies they are dealing with can pay for it, you can see how the hotels would accept their business," said Peggy Callahan, executive director of the Metropolitan Memphis Hotel & Lodging Association.
Callahan said a hotel can't anymore refuse business from a service company than it could a religious group.
"A hotel manager may not support a certain religious group, but that won't and shouldn't keep a hotel from renting a room to it," she said by way of analogy.