Held up as a paragon for consumer safety and unbiased company ratings, the Better Business Bureau stands accused of selling favorable company ratings for cash. Just how much did a good BBB rating go for? (And why did Hamas get one?)
Join the British Columbia Better Business Bureau, Watch Your BBB Rating Go Up!
CBC News reports that the B.C. Better Business Bureau instituted a pay-to-play policy for companies hoping to elevate their ratings. With BBB rating options ranging from A to F, investigative reporters uncovered that accredited moving companies (those who paid for a membership) featured ratings at or better than “A-“.
These rating levels stood in spite of consumer complaints. Non-accredited moving companies’ highest ratings only ranked at a “B” grade. One company that canceled its membership saw its rating decrease from an “A” to a “D-” because of one complaint.
Southland Businesses: Better Business Bureau Uses Strong Arm Techniques to Force Accreditation and Awards Hamas an A Rating
Lest the consumer believes that this pay-to-play scheme is a Canadian problem, consider the Los Angeles branch of the BBB. Rating problems and exorbitant salaries made the headlines of the Los Angeles Times, and the problem associated with for-pay company ratings at a supposedly impartial and non-profit organization does not sit well with businesses or consumers.
Small business owners in particular complain that BBB accreditations are sold by telemarketers who use strong-arm tactics. While bigger business entities may not have a problem paying right around $400 for a yearly accreditation, new start-up companies and smaller businesses frequently do not have these funds available.
Adding insult to injury, there appears to be precious little investigation into the merits of an A rating with a paid membership. As outlined by ABC News, L.A. business owners tried to make this point when setting up a fictitious business they christened “Hamas,” paid $425 for a membership fee and received an “A+” rating.
BBB Response: From Human Error Excuse to Mea Culpa
Even though local Better Business Bureau representatives attempted to do damage control and point to “A” ratings by companies that are not accredited, the Council of Better Business Bureaus decided to fall on its sword and offer a mea culpa statement. While it is true that individual mis-ratings could be attributed to human error, the nation- and country-wide reports point to a bigger problem.
At this time, the rating system will do away with the award of brownie points for a paid membership/business accreditation. Consumers in search of a complaints process can now issue their misgivings – to the BBB. President and CEO Steve Cox explains that the organization takes these steps to help maintain the public’s trust. (A short six days before making this statement, Mr. Cox asserted to ABC News that it’s “an inaccurate statement that business people are able to buy A’s.”)
Are Consumer Grades More Reliable?
While the business model of the commercially available rating erodes the public’s trust in the Better Business Bureau and its ratings, other companies focus on consumer input to offer evaluations of local businesses. A good example is Angie’s List, which features customer reviews and ratings for a wide array of business entities.
Although much smaller than the BBB, Angie’s List does not charge businesses a fee to get listed; consumers must register prior to leaving feedback, and all reviews are fact-checked.
While it would be foolhardy to completely discount the Better Business Bureau and its company ratings – the BBB boasts an annual 65 million consumer searches when compared to Angie’s Lists’ 1 million members – it may be wise to research companies further. Cross-reference them with services, such as Angie’s List, and do not be shy about digging up the dirt before you sign on the dotted line. Anymore, company ratings appear to be in the eye of the beholder.
CBC News: “Better Business Bureau accused of biased ratings”
Los Angeles Times: “Top Executive at Better Business Bureau’s L.A. branch earns more than $400,000 a year”
ABC News: “Terror Group Gets “A” Rating Better Business Bureau?”
Better Business Bureau: “BBB Takes Action”
Angie’s List: “Companies don’t pay to be on Angie’s List”