Intelius

Naveen Jain's Intelius Scam Begins To Crumble. Good.

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A year ago we wrote about Naveen Jain’s current startup, Intelius. Jain left previous the company he founded, InfoSpace, in disgrace in late 2002 after violating insider trading laws and other sketchy activities. After leaving InfoSpace Jain started Intelius, across the street from his old offices in Bellevue, Washington.

In that post we outlined how Intelius, at the time in the process of becoming a public company, was growing revenue via a scam:

Intelius has been on the receiving end of hundreds of consumer complaints alleging fraud, many of which are around a partnership the company has with Adaptive Marketing and a “product” they offer called Privacy Matters Identity.

Every time a customer buys a product at Intelius, they are shown a page telling them “Take our 2008 Consumer Credit Survey and claim $10.00 CASH BACK with Privacy Matters Identity.” The user is then shown two survey questions and asked to enter their email and click a large orange button. They can choose to skip the survey by clicking on a small link at the bottom of the page.

Undoubtedly a lot of consumers do the survey and move forward to the next page – it only takes a second. But what most people don’t do is read the fine print, which gives no real details on the $10 cash back (in fact, it is never mentioned again, anywhere). Instead, in light gray small text, users are told that by taking the survey they are really signing up to a $20/month subscription. Intelius forwards your personal information, including your credit card, to Adaptive Marketing. The next day a $20 charge appears on your credit card, and each month afterwards.

Now, nearly a year later, Intelius is being deservedly buried in lawsuits and consumer complaints. A long Seattle Weekly expose on Jain and Intelius describes the various legal issues facing the company: 121 complaints to the Washington State Attorney General’s Office, 822 complaints to the Better Business Bureau, a lawsuit in King County Superior Court accusing Jain of inflating financial figures and a Federal Trade Commission investigation for possible violation of laws regulating how credit information is disseminated. More at TechFlash.

As an aside, all these negative stories are really piling up for Google searches on Naveen Jain. Jain has clearly been using basic SEO tacticts to try to drive those stories down. He maintains at a handful of sites, Naveenjain.com, naveenjain.org and naveenjain.us, naveenjain.info, all of which use his full name in almost every sentence and talk about his philanthropic efforts. All of the sites link to eachother, creating a small link farm. Still, the bad news is out there.

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