Spiegel charges credit cards in coupon gaffe

Just weeks after accusing customers of misusing its coupons, Spiegel has begun to charge customers' credit cards for the amount it says they owe.

The Downers Grove, Ill.-based catalog and online retail company is charging customers who "excessively misused" its coupons, said Spiegel spokeswoman Chris Crockett. Crocket declined to say how many credit cards Spiegel is charging or how much money the company lost.

"We're only charging for the amount of (coupons) that were used improperly," Crockett said.

But customers already are disputing the charges and Spiegel may have to answer to higher authorities. Customers have filed complaints with the Better Business Bureau and the situation prompted questions at the Federal Trade Commission and with MasterCard.

"The FTC would like to know more about Spiegel's practices, but hasn't made any determination about whether their practices violate the law," a commission representative said.

This spring, Spiegel's sent out coupons of $5 to $20 off to customers who bought its catalog or ordered products through it. Although the coupons were supposed to be for "one time use only," they did not have unique code numbers. Some customers repeatedly used the same code number if not the same physical coupon to order products at deep discounts or for free.

While many customers placed their orders over the phone, many heard about the discount via online message boards such as those on MyShoppingBoards.com.

Although customers say that Spiegel cancelled some orders, the retailer accepted and mailed out many others. But earlier this month, the company mailed dozens of customers, demanding money for the misused coupons and telling customers that it no longer wanted their business.

Kristen Lewis, a stay-at-home mom from Neosho, Mo., said Spiegel recently charged her credit card $292.52 for misusing the coupons. Although Lewis said she can understand if the company felt people were taking advantage of it, the company should have been able to catch its own mistakes. Lewis said she has disputed the charges with her credit card company and has written letters to the FTC and the Better Business Bureau.

"I don't feel like I ripped them off," Lewis said. "I've been a customer for years and I didn't take it all for free.

"They should have had a better system. They shouldn't have charged me for merchandise they already sent me and (coupons) they sent me."

The Chicago Better Business Bureau has received three complaints from Spiegel customers regarding the matter and is awaiting a response from Spiegel to the customers' allegations, said Steve Bernas, director of operations at the Chicago Better Business Bureau. The company has 15 days to respond to each complaint, the first of which was filed on July 24.

"We have not received a position from Spiegel regarding the issue," Bernas said.

Meanwhile, MasterCard spokeswoman Sharon Gamsin called Spiegel's actions "unusual."

"I think we're going to have to look into it," Gamsin said.